Community solar projects allow households, small businesses, and public entities to buy into larger offsite PV plants without owning a roof or onsite asset. Instead of net-metering, participants typically receive bill credits linked to a share of the project's output. At Energy Solutions, analysts aggregate programme data, developer disclosures, and tariff structures to benchmark achievable discounts and risk profiles across regions.
Community solar projects pool demand from multiple subscribers—households, SMEs, and public customers—into a single offsite PV asset. Instead of installing panels on individual roofs, participants subscribe to a share of project output. Their electricity bills then receive credits based on metered production multiplied by a defined bill-credit rate.
Credit structures vary. Some programmes peg bill credits close to retail tariffs, while others link them to wholesale prices or administratively-set values. The spread between the bill-credit rate and the subscriber's subscription fee defines the effective discount. Energy Solutions analysis shows that projects paired with robust analytics—such as the Solar ROI & LCOE Tool and Tariff & Bill Analyzer—tend to deliver more predictable outcomes for both developers and off-takers.
| Option | Asset Location | Typical Participant Profile | CAPEX Ownership | Expected Bill Savings |
|---|---|---|---|---|
| Community solar subscription | Offsite shared PV | Renters, small businesses, municipalities | Developer or utility | 5–20% of credited usage |
| Onsite rooftop solar (owned) | Customer roof | Homeowners, property owners | Customer or landlord | 10–30% of total bill (site-specific) |
| Utility green tariff | Remote utility assets | Corporate off-takers, large loads | Utility / IPP | 0–10% vs standard tariff (varies by design) |
Source: Energy Solutions Intelligence (2025); stylised ranges across active community solar markets.
Community solar economics depend on project scale, interconnection costs, local tariffs, and incentives. The following benchmarks represent stylised 2026 projects under mid-range tariff and solar resource conditions.
| Project Archetype | Capacity (MWdc) | All-in CAPEX (USD/Wdc) | LCOE (USD/MWh, real 2025) | Target Project IRR |
|---|---|---|---|---|
| Suburban feeder community solar | 5–10 | 1.05–1.25 | 48–62 | 8–11% |
| Rural large-scale shared solar | 15–20 | 0.95–1.15 | 40–55 | 9–13% |
| Urban constrained-site project | 3–6 | 1.20–1.30 | 55–70 | 8–10% |
Source: Energy Solutions modelling; unsubsidised base case, constant real terms.
Programmes increasingly differentiate offers for low-to-moderate income (LMI) subscribers, general residential customers, and commercial/community facilities. Contract terms, discount levels, and credit requirements vary accordingly.
Source: Energy Solutions Intelligence (2025); indicative weighting of key drivers.
A mature US programme with standardised subscriber contracts and bill credit rates tied to retail tariffs has enabled a portfolio of mid-scale projects.
Municipalities and energy cooperatives in parts of Europe have deployed shared solar on public rooftops and brownfield sites, often linked to local retail offers.
Policy frameworks and market structures heavily influence the scale and economics of community solar. The US currently leads in programme count and installed capacity, while Europe and parts of Asia are exploring variants linked to energy communities and retail innovation.
Source: Energy Solutions scenarios; cumulative installed capacity 2024–2030.
Strong economics on paper do not eliminate risk. Key pain points observed in community solar portfolios include:
Robust contract standardisation, conservative underwriting assumptions, and transparent communication strategies are therefore central to bankable community solar pipelines.
By 2030, Energy Solutions scenarios suggest that community and shared solar could represent 15–25% of incremental distributed PV capacity in markets with supportive regulation. By 2035, integration with co-located storage, dynamic tariffs, and virtual power plant (VPP) platforms is expected to deepen revenue stacking opportunities.
For utilities, developers, and lenders, community solar becomes less of a pilot and more of a standard product: a mechanism to reach rooftops and customers that conventional onsite solar cannot serve, while feeding flexibility into aggregated portfolios.
Eligibility rules vary by programme, but renters, homeowners without suitable roofs, SMEs, and public entities are commonly targeted. Credit checks, minimum subscription sizes, and location requirements (for example, same utility territory) apply in many markets.
Discounts depend on the relationship between subscription fees and bill credit formulas. Where regulators provide long-term clarity on bill credit rates and escalation, discount levels are more predictable; short-term pilot structures introduce higher volatility.
From a lender's perspective, community solar offers portfolio-level diversification and professional O&M, but introduces policy and off-taker aggregation risks. Rooftop projects are more site-specific but sometimes benefit from clearer metering and collateral structures.
Portfolio owners and advisors often use tools such as the Solar ROI & LCOE Tool and Tariff & Bill Analyzer to compare subscription structures, test sensitivity to policy changes, and benchmark returns against onsite options.