Clean Energy Co. (CEC) builds, operates and maintains community-shared clean energy facilities. CEC is pioneering the model of delivering clean power-generation through medium-scale facilities that collectively serve participating utility customers. Their proprietary software automatically calculates monthly credits for members and integrates with the utilities’ existing billing system.
REC Solar has partnered with CEC to build a portfolio of projects in Massachusetts and Colorado. We invited CEC’s Director of Public Affairs, Tim Braun, to give us an update on the company and trends to pay attention to in community solar in 2017.
We are finishing up working together on several projects in Massachusetts. Can you tell us what the outlook looks like this year regarding community solar? Does the focus continue to be on core states like MA and CO or are other markets becoming more viable?
Despite being a relatively new solution for distributed energy generation, community solar is growing at an impressive pace. In 2016 we saw cumulative operating capacity cross the 200 MW mark, and we expect it to exceed 400 MW this year.
Certainly, a good portion of this growth in the near term will come from core markets that have community solar-enabling policy, including Colorado, Massachusetts, Minnesota, and New York, and from states that recently enacted community solar legislation and are coming online this year, like Maryland. The legislative and regulatory framework in these states allow companies to deploy projects, or in Clean Energy Collective’s case a large portfolio of projects, with clearly defined guidelines and predictable economics. A significant amount of capacity that was previously stalled while program and interconnection issues were being resolved is moving into development.
However, legislation is not a requirement for community solar’s progress, as we’re seeing strong growth in other markets as well. Increasingly, this growth is from utility-sponsored initiatives, which allow investor-owned, municipal, and cooperative utilities to cost-effectively serve customers’ demand for renewable options while keeping a grid-tied relationship with them. In fact, more than 150 utilities across the U.S. now have a voluntary community solar program in place or in development.
Are there specific trends you are seeing across states in policies that are helping to drive or stifle the growth of community solar?
As several new states are either finalizing legislation to introduce community solar programs or are initiating the process, legislators and policy makers in these states have looked to existing programs to determine best practices in successful community solar program design. The first is program complexity. Some early shared-solar programs had good intentions but included overly complicated rules and burdensome requirements, which hindered developer and consumer participation. The inclination now is to seek simplicity and clarity in structure and process.
Program size and project size are considerations getting more weight in policy design. States are recognizing that establishing larger community solar programs, versus testing the waters with smaller pilot programs, broadens participation and contributes to longer-term success. Allowing larger project sizes lowers development costs, which improves the value proposition and supports more participation by low and moderate income households.
Some of the larger community solar markets, like Minnesota and Massachusetts, experienced long delays in project development as projects stalled in the interconnection application process. As a result, these states and others have worked to establish clear interconnection procedures, timelines, and costs, and are addressing queue management and cost sharing (for projects on the same substations).
CEC is clearly a leader in bringing together community officials, consumers, financing partners and other entities necessary to make a project happen. Are you able to do this just because of your experience developing successful projects, or are there other tips you have for project developers?
The short answer is yes, launching and leading this market has provided CEC with an unmatched level of experience with all of the phases required to deploy a successful community solar project, including project development, utility integration, customer acquisition and retention, and program management. CEC has built an exceptionally talented staff of specialists in each of these areas, and work with established partners, like REC Solar, where needed.
But it is also because CEC participates in all of these phases as a pure-play, full-service community solar developer that we are successful. That is, we approach every project with a holistic perspective, knowing the company and facility will be part of the community for the long term, versus addressing only one aspect of it and moving on. In doing so, it’s imperative that we work closely with local partners, community leaders, and other stakeholders to make sure the projects we develop and the way we conduct ourselves are harmonious.
What are some of the things you are looking for in a market and project site?
Every market has unique characteristics, both positive and negative. In unregulated markets, we first look to establish strong utility relationships, helping them understand the opportunity and define their goals and objectives for a community solar program. In regulated markets, we gauge the ability to develop a comprehensive portfolio of projects that can provide broad, inclusive access to affordable solar.
When siting projects, location is important because it affects project economics, via direct development costs and potentially through the credit valuation (as locational value adjustments are being considered in some states). In general, though, an optimal site for installing several hundred to several thousand solar PV panels is a large, flat area of otherwise unproductive land with good solar exposure that is adjacent or close to utility distribution equipment. It can be public or private land, with brownfields usually a high priority. As community solar emerges in densely populated markets like New York, we are also working with owners and managers of buildings with open, flat rooftops that can host a shared system.
Is there anything else you want to highlight about CEC?
I’ve been involved with community solar since CEC cut the ribbon on the nation’s first community-owned solar project in 2010, and have witnessed its evolution into a widely-embraced solution that works for consumers, utilities, and developers. During this time, CEC has worked very hard behind the scenes on policy and regulatory initiatives, program and product design, utility relations, and consumer advocacy to help the industry grow and mature. It’s exciting to be part of a team leading an emerging industry, especially one that is effecting such dramatic change in our relationship with energy.
To learn more about CEC, visit cleanenergycollective.com