Big news from Maryland, where last week regulators approved a community solar pilot program with a strong focus on ensuring that solar shines for all.
Declining solar costs and fast industry growth are creating opportunities to put solar energy to work providing long-term financial relief, stable employment, and improved environmental health in underserved communities. States across the country are exploring new community solar models – which allows consumers who don’t own a suitable roof to instead participate in a shared solar system located elsewhere in their community – as an additional pathway to connect renters and low-income consumers with these clean energy benefits. But as with single- and multifamily solar programs, community solar programs must address the unique financial and market barriers facing low-income participants in order to fully and sustainably serve those communities. We think Maryland’s pilot program shows great promise in doing just that.
Last year, the Maryland General Assembly passed legislation directing regulators at the Maryland Public Service Commission (PSC) to craft a Community Solar Pilot Program that would allow for study and recommendations on a number of different topics. Among those topics are the appropriate valuation of community solar subscription credits, the impact of community solar – and, specifically, virtual net metering – on the distribution grid, and the impact of community solar projects on the costs of the state’s RPS and on locational marginal prices.
Notably, the 2015 legislation also included very strong direction that the Community Solar Pilot Program be crafted to benefit low- and moderate-income (LMI) customers in Maryland, stating that the program must: allow renters and LMI customers to own an interest in projects; facilitate market entry for all potential subscribers and prioritize subscribers who are the most sensitive to market barriers; and encourage developers to promote participation by renters and low-income customers.
As approved by the Maryland PSC (PDF), the program contains a 60 MW (30%) carve-out for projects where 20% of the output serves LMI customers. On top of that, more capacity is set aside for projects where at least half of subscribers are LMI customers. The pilot program also includes a carve-out for projects that are located on brownfield sites, rooftops, or that serve as carports. With these guidelines, Maryland’s Community Solar Pilot Program is designed to create diverse opportunities for solar participation, particularly among those families and communities who have the most to gain from a transition to clean, affordable solar power.
The PSC also approved provisions that increase the likelihood that this pilot will move successfully into full community solar build-out in the state. First, the Commission approved an overall pilot program capacity of just over 200 MW, which advocates and developers had pushed for, arguing that a program of that size would build strong and sustainable foundations for long-term market growth. Second, the Commission affirmed that a full-retail credit value for community solar customers is necessary to ensure a successful program.
It may still be in its early stages, but we think that Maryland’s program – with robust capacity, full retail rate value, and aggressive carve-outs for low-income customers – is a recipe for success.
Learn more about how community solar programs can be designed to serve low-income customers in our Low-Income Solar Policy Guide.