Community Solar #02 – Don’t Have a Roof? Use Someone Elses.

In part 2 of 2 in this piece we overview Community Solar, or in other terms ‘strata solar’ installations. There are many of us without our own roof (e.g. we live in an apartment), or we have a roof that isn’t suited for efficient solar power (e.g. wrong orientation, overshading etc.). But there is still a way to generate solar power that we can financially benefit from.

To recap on part 1 of this post, there are essentially two directions that community solar schemes can take;

  • Collective Bargaining – where a large number of community households convene what is effectively a ‘purchasing cartel’ to unlock bulk-purchasing power; and
  • Community Solar – where a community group pools resources to invest in a large consolidated solar installation, and receives dividends.

The principles of ‘community solar’ are relatively simple;

  • a group of stakeholders (could be residents, businesses, investors etc.) form an entity that invests in a larger scale solar power installation;
  • the larger scale installation achieves some economy of scale, reducing costs per investor;
  • the investors receive some form of dividend from the power generated.

There are various structures under which an installation can be governed. One option is that the group literally invest in building the installation, and receive dividends.

Another is where the local Council will build the installation, and rate payers can lease a chosen number of panels. Their dividend in energy production is then deducted from their rates. The South Melbourne Market scheme is intending to adopt a version of this approach via Port Phillip Council who have funded the first stage.

photovoltaic on parking

There are even schemes popping up where a multi-tenanted office building provides a strata PV array on the roof, and tenants can then include a chosen number of panels in their lease, receiving deductions on their outgoings.

There appear to be many examples around of legal or funding complexities, particularly out of the US, but it’s also clear that this form of community-backed renewable power generation has gained a foothold and will only grow in strength – it just makes good business sense.

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