Community solar is gaining attention for the benefits it can bring to electricity customers. But one question comes up again and again: “How does it actually work?”
In this guide, we’ll walk through the structure step by step so you can see how community solar creates savings and what participation actually looks like.
What is Community Solar?
Community solar makes it possible to benefit from solar power without having panels installed on your own property.
As long as you and the solar project are located within the same electric utility territory, you can subscribe to a share of the project. Instead of receiving electricity directly from the solar farm, you receive bill credits on your electric bill tied to your share of the project’s production.
In many ways, it works like having solar panels of your own — without needing to install, maintain, or finance them yourself.
This structure makes community solar accessible to homeowners, renters, apartment residents, nonprofits, and businesses alike.
How Community Solar Works Step by Step
- You enroll in a community solar project sized appropriately for your electricity usage.
- The solar farm generates electricity as sunlight hits the panels.
- Bill credits begin appearing directly on your utility bill based on your share of the project’s production.
- You pay the solar project owner for a portion of the credits received.
- The difference between the credits received and the payment made becomes your savings.
Example
Suppose your home, apartment, or business spends $10,000 per year on electricity.
A community solar project provides $10,000 in bill credits, but charges 90% of that value ($9,000).
The remaining difference — $1,000 in this example — becomes your savings.
Why People Choose Community Solar
Since payment is structured as a fixed percentage of the value delivered, participants never pay more than the benefit they receive.
These savings are not a one-time discount. They continue month after month for the duration of the agreement.
Many residential subscribers enroll in shorter-term agreements, while larger organizations sometimes lock in savings for longer periods.
There’s no equipment to install on your property, no disruption to your electricity service, and no change to how power reaches your home or business.
The primary difference is simple: your electric bill becomes lower and more predictable over time.