Smart Energy Living - May 2011


Community Solar Gardens Sprout in Colorado:
Now you can go solar even if you don't have a rooftop

By: Becky English

If you want to get your electricity from the sun’s rays, you might be able to join with neighbors in “planting’’ a solar garden starting in 2012.

Solar Panels

With an average 300 sunny days per year, Colorado is a great place to generate electricity using the power of the sun.  Besides this considerable “solar resource,” Coloradans have state rebates, utility programs and other incentives that vary by location. 

But what if your neighbor’s oak tree shades your roof all afternoon from April through November?  Or maybe you live in an apartment or condo and have no roof at all.  Perhaps you only plan to be at your current residence for a limited time, too short to justify a major investment in solar panels.  Or maybe the steep cost of solar is not within your family budget during these tough economic times. Until the Colorado legislature passed the Community Solar Gardens bill in 2010, you were out of luck for going solar  through rooftop solar photovoltaics (PV).

But as a result of the new law, groups of people who want to generate solar energy together soon will be able to create community solar gardens, much as groups have come together to create community vegetable gardens.  The Colorado Public Utilities Commission (PUC) decided on rules for the new program governing projects in Xcel Energy and  Black Hills Energy territory in the spring of 2012.  Among other things, the law and the regulations require that each project have at least 10 subscribers, and require that some of the power be reserved for low-income residents.

The program is expected to launch in late July of 2012 with capacity left over from last year split between this year and next year. Other  groups are working to launch solar gardens in areas where municipal utilities provide power and where rural electric cooperatives are the utilities.

The community power movement

Joy Hughes says solar gardens are part of a community power movement.  “Now people have a choice,’’ she says. “ They can get their power from their local utilities, or they can join with their neighbors, their friends, or others in their counties, and propose a solar garden.  They’ll get a credit on their electric bills for the power their panels produce.”  Hughes has created a nonprofit organization, the Solar Gardens Institute, to teach people how to create community solar gardens.  She’s also the president of a business, Solar Panel Hosting, which develops, provides consulting for, and manages community solar gardens under various models, including a subscription model.   The Clean Energy Collective in Carbondale already developed Colorado’s first solar garden in conjunction with Holy Cross Electric. You can learn more about their model at www.easyclearenergy.com

Hughes first encountered a group interested in community power in Nederland, Colorado, where neighbors wanted to have a community renewable energy development.  They found appropriate land, but they discovered they couldn’t create such a development under current law.  Representative Claire Levy listened to their story, and responded by carrying the Solar Gardens bill in Colorado’s House of Representatives during the 2010 legislative session.  Governor Ritter signed the bill into law in June, 2010. 

Xcel will call its program " Solar Rewards Community''. The program is expected to launch at the end of July, 2012, pending a final order from the Colorado PUC. The program will open with 4.5 MW available in the standard offer program (10 kW -- 500 kW) and 4.5 MW available in the RFP program (500.1 kW -- 2 MW).

Community solar gardens are a form of “distributed generation,” as opposed to large central power generation provided by, for example, coal plants that supply the majority of Colorado’s energy. 

Distributed generation helps communities keep economic development and jobs made possible by renewable energy in their local area.  Small and mid-sized distributed renewable energy projects help the planet in comparison to fossil fueled power generation that produces carbon emissions.  And, like the local food movement, the safe streets initiative, and the sustainability movement, solar gardens help build community. 

Taking energy into our own hands

Hughes began her company on the last day of the 2009 Copenhagen climate conference, believing that world leaders were not going to meet the world’s energy challenges.  “I realized that we need to take matters into our own hands.  We can address the challenge of global warming with the distributed generation approach, without damaging our environment,” she says.

Many existing groups, some of which have community buildings, have shown an interest in solar gardens. Homeowners’ associations, economic development groups, faith groups, school districts, libraries and recreation centers, farmers and ranchers, and various nonprofits such as YMCAs are among those Hughes expects will  be interested.


Numerous state endorse community projects

Colorado is just one of several states where community renewable energy projects are legal.  Such projects are already in place in Oregon, Maryland, and Washington D.C.  Laws similar to Colorado’s statute exist in other states, including Massachusetts, Vermont, Maine, Delaware, and the state of Washington.  States considering variations are Texas, Arizona, California, Utah, Montana, and Florida. 


Legal issues still await clarification

It’s not clear yet whether Solar Gardens are securities under Colorado law.  The Colorado Securities Commission has issued a preliminary opinion indicating that as long as the subscribers to a community solar PV system are involved in its management, the system s not a security.  Cooperatives are exempt from a securities designation, and certain LLCs involving fewer than 35 people are exempt (Solar Gardens require at least 10 subscribers). 

The tax code is the primary source of remaining confusion about Solar Gardens.  Typically, third party investors in community solar developments claim tax credits, as most system subscribers thus far do not have a tax appetite.  If the hosting organization does have a tax burden, then tax credits can be claimed.  If the development is on an individual’s property, that individual can claim a tax credit.

--Becky English

Becky English is a sustainability consultant, writer, and editor based in Denver, Colorado. 

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