• SMUD has received green signal from the CEC for its Neighborhood SolarShares program
  • This provides an alternative to new homes in SMUD’s operating area to either share solar power from community solar arrays that SMUD will build or install rooftop solar systems
  • The utility says it will bring down construction costs for new homes in the state while guaranteeing them annual net benefit of about $10 per kW
  • Rooftop solar industry and experts believe this will continue to give utilities the upper hand in the electricity supply market and discourage homes from becoming their own electricity generators

The Sacramento Municipal Utility District (SMUD) has had a clear win with the California Energy Commission (CEC) approving its proposal for its Neighborhood SolarShares called community solar program. This now doesn’t require all new home owners in SMUD’s grid to install rooftop solar systems as mandated under the state’s 2019 Building Standards as of 2020. It rather offers the option to go in for shared solar power generation from community solar arrays as well.

What’s the plan?

Under California’s new law, as of  2020, all new low-rise residential homes under three stories high are required to run on solar power. The CEC approval now allows for home dwellers to purchase solar power from off-site but grid connected solar arrays for 20 years, which will be built by developers in collaboration with SMUD. The utility says it will ensure occupants of the participating home will get an annual net benefit of about $10 per kW. SMUD will collaborate with builders to offer either community solar or rooftop solar at the point of purchase.

All the community solar arrays, to be located within SMUD’s service territory, will have a maximum capacity of 20 MW. Initially, power can be sourced from existing operational 13 MW Wildflower community solar plant in Rio Linda. 

What SMUD says?

As ‘largest utility green pricing community solar program of its kind in the nation’ SolarShares offers guaranteed monthly solar energy for 20 years, allows for tree-friendly developments by letting the roof be, does away with the stress of long term maintenance and replacement of rooftop solar systems, claims SMUD, adding that it is more economical especially for people from low-income who may not be able to afford rooftop solar systems thereby reducing construction costs for users.

This proposal meets all the requirements and provides an alternative way to provide solar energy for our customers. This is an important program that provides developers and homebuyers with an attractive option and helps us meet our goal of being carbon neutral by 2040,” said SMUD CEO and General Manager Arlen Orchard about Neighborhood SolarShares.

What’s the problem then?  

The biggest disadvantage of this community solar scheme offered by a utility in California is that it discourages consumers from becoming prosumers, from attaining energy independence from the grid as it would set a precedent for other utilities to follow suit, as per rooftop solar advocates.

It will also do away with the requirement for energy storage on days when there is no sun shining as one assumes the fossil-fuel powered grid will step up to provide the remaining electricity supply thus reinforcing the dominating role of utilities in the state’s power supply, local media referred to the inputs shared by the rooftop solar advocates with the commission. And in the event of storms, the power supply is shut by the utilities to prevent fire incidents, so it does not provide continuous energy supply to homes that rooftop solar & storage can do. While larger solar systems are cheaper, it still means that homeowners will save less on their electricity bills when they buy external solar power. If this workaround will get many followers, this could also negatively impact the development of building-integrated PV solutions, a technology with a huge but unfulfilled promised that was supposed to get backing through the new solar rooftop requirement in California.

However, US solar industry experts suggested community solar could be provided as an option for low income households rather than offering it to everyone.

Earlier this year, SMUD’s integrated resource plan (IRP) for 2.9 GW utility scale renewable energy plan comprising 1.5 GW solar power by 2040 was cleared by the CEC (see Sacramento Utility Aims For 2.9 GW Clean Power By 2040).