Community Solar Farm FAQ
Answers to our most common questions about member-owned community solar farms in Maine and New Hampshire.
What is a Community Solar Farm?
It’s a solar array that is co-owned by more than one person or business.
How does community solar “work”?
In Maine, community solar utilizes its net metering policy, which allows up 9 account holders within CMP or Emera Maine’s territory to co-own solar. Each so-called “Member” of the solar farm owns a portion of the array, and the power generated from it – both, in proportion their original investment in its capital costs. Each portion is called a “share”. Each month, the utility will allocate the array’s electricity generation and will issue each Member a credit “payment” to their bill. In summer and high-generation months, the allocation will likely cover the bill, or exceed it. If so, the excess can be carried over and applied toward the next month’s balance, and the following one, up to 12 times (1 year of statements). Every kilowatt hour of solar electricity produced is applied against Members’ bills.
Why is community solar so great?
It allows anyone to own solar. It’s a perfect solution for those who don’t have a great place to put it. Further, you own something that will be useful for generations. Pay once. Take control of your electricity costs. Invest forward.
Who can join a Community Solar Farm?
Anyone with a utility account can join and become a Member – including renters, condominium owners (who typically don’t own their roofs), those with roofs that are not solar-situated because of shading, poor roof quality, historic prohibitions, etc.
In some cases, Members are joined by a common purpose – membership in a church, condo association, community-supported farming group, etc. In other cases, they are combined together by ReVision.
What if I move or need to sell?
Membership shares are portable and transferable to any account within the same utility territory. Thus, if you move, you are free to reassign your shares to a new account – yours, your business’s, or someone else’s. If you move outside the utility territory, you are free to sell or transfer your shares. In addition, because arrays are physical assets that are owned in perpetuity, Members should plan for the long-term disposition and transfer of their shares. Strange as it sounds, your solar shares will likely outlive you!
How are community solar projects created?
We are actively seeking host sites for future projects. Once identified, a potential site is screened for feasibility (adequate space including for setbacks and array spacing, non-northern exposure, open fields, good soils, preferably no mortgage, etc.). If a site meets our requirements, a project is designed for the site, and the host landowner and ReVision work together to develop the project. In some cases, we work with partner groups such as churches, environmental groups, CSA groups, etc., to identify potential Members. In other cases, we do this alone. Either way, once a project has 9 Members, ReVision helps the group form a Mutual Benefit Non-Profit Association (Association) to oversee the management of the project. This is a commonly used, non-taxable structure that typically allows for the management of co-owned assets (including for condominiums, road associations, and the like).
Who owns the array? Who manages the array?
The members own the array. The Association owns nothing, and serves solely as the structure needed to oversee the management the array, its Members, and their shares. The Association does this through elected offices, similar to any company – President, Treasures, Secretary, etc.
Who maintains the array?
Solar arrays need very little maintenance other than seasonal mowing. At the Association’s option, it may maintain the array on its own, or may hire us to do it.
How much does it cost to join a CSF?
There are 3 costs – first two are one-time, and the third is annual. They are: 1) the cost of forming the Association; 2) the cost of installing the array; and 3) the cost of annually operating and maintaining it.
- Formation costs are estimated at $3,500 and are shared among all Members. We’ve arranged for the Law Firm of Drummond & Drummond to handle all legal paperwork and services.
- Installation costs vary based on the unique site, including interconnection distance to an electricity distribution line, the type of soils, the condition of the land present, etc., amongst other variables. ReVision will size your share and provide an estimate of share costs to you.
- Annual costs vary depending on the Association’s options (RECs management, operations and maintenance, etc.). Typical annual net costs – including income and expenses – for a typical 50 kw array that produces a total of 60,000 kWh/year are estimated as follows*:
|Description||Value per kW Share||Sample 5 kW Share|
|Landowner Lease Payment (per kW) **||(15.00)||(75.00)|
|General Liability Insurance||(20.00)||(100.00)|
|Registration Fees (ME Sec of State)||(0.80)||(4.00)|
|CMP Electric Meter||(3.60)||(18.00)|
|Net Income (Expense)||(34.40)||(172.00)|
* REC income begins in year 2 (after one full year of generation). REC value fluctuates; numbers are for illustrative purposes only.
** The Association shall pay the Host $15 per kw per year, to increase 2% annually each year.
What are RECs?
A REC, or “renewable energy credit”, is a credit (or a value) granted to someone who owns a green power generator. They can be bought and sold and are in existence for the purpose of generating more green power in society. In the context of solar, every kilowatt hour of solar power generated is allocated a certain amount of RECs that can be kept (retired) or sold.
Who’s in charge of managing RECs?
The association can decide to manage RECs on their own, or hire ReVision to manage RECs for them.
ReVision will charge a 2% brokerage fee on total REC revenue and a $200 annual operations fee. ReVision will sell RECs when the market is most favorable, either annually or quarterly, and will remit payment to the CSF within 30 days of a sale.
What if I want to forego the annual income and instead retire my RECs?
You are free to do that, although in a co-owned project like a solar farm, it takes some extra work on your part. Assuming the rest of the Members want to sell their RECs to offset annual costs, the easiest and cheapest way this is done is for the Association to sell the array’s total RECs, and then for you to buy back your share of RECs on your own.
What kind of financing is available?
Through our partner, Green Sky Finance, ReVision Energy offers low-cost financing options for all solar projects, including Membership shares, through our “Own Your Power” Loan Program. In less than 15 minutes (typically), you can apply on-line and receive a 12-year, unsecured loan at 2.99%. Go to: http://www.revisionenergy.com/at-home/solar-loans.
How do I file for a tax credit?
Talk with your tax expert about filing IRS Form 5695, or https://www.irs.gov/pub/irs-pdf/i5695.pdf
How many years do solar panels generate power?
Solar panels sold today don’t ever stop generating. While some of the wiring may need upgrading in future years, the panels remain useful for over 40 years and generations to come with a minimal reduction in output.
What happens when the 30 year lease is up?
When the 30 year lease is up, the association and host can agree to extend the lease in 5 year increments.
So long as the project is generating electricity — and it will be for 40 years — it will likely make the most economic sense to leave it in place rather than dismantle. To the extent the CSF is not interfering with other land uses, the lease will most likely be continued well after 30 years. Most projects will eventually be retired and sold for salvage value or scrap. The land will then be returned to its original condition.
If the lease is not renewed, the members can decide whether to sell, recycle, donate to developing world projects, or move the array.
Can I assign multiple CMP accounts to my CSF share?
For net energy billing purposes, one account = one share. If you’d like to offset multiple CMP accounts, you can, but each CMP account would be assigned one of the 9 shares.
Can I access the array?
Access is arranged between the Host and the Association, and typically includes all necessary access to provide for installation, and operations and maintenance. Beyond that, the Host and Association are free to make whatever arrangements for additional access that they mutually want.
Are solar farms taxed in Maine?
It depends on the community where one is located and in the vast majority of cases, they are not taxed. If a community chooses to tax a solar farm, the Members are responsible for the assessment. The Host/Landlord is not responsible for the array’s assessment but remains responsible for the site’s assessment.
Where are there solar farms in Maine now?
There are eight community solar farms now in Maine, and many more in the works. The Sunnycroft Solar Farm became operational in October 2014. The Edgecomb Solar Farm became operational in June 2015, and the Maine Idyll Solar Farm in Freeport, and the Sky Ranch Solar Farm in Wayne became operational in early 2016. Crystal Springs Farm in Brunswick, Kimball Farm in Lovell, Morris Farm in Wiscasset, and Higgins Farm in Lisbon became operational by the end of 2016. We are actively seeking new sites all the time, and are developing projects now in over 25 communities.
I’m in! What’s next – what do I need to do to become a Member of a solar farm?
- Contact us and request an on-site visit to discuss your anticipated annual electricity usage, any future changes to that, whether roof-top or community solar is the best option for you, and we will estimate the size and cost of your own array, or community share.
- Understand your options between your own installation versus a share in a solar farm – costs, pros/cons, etc.
- If you want, go on-line to our website and explore particular solar farms that are open to new members.
- Call us to make your purchase (system or share) and make your $1000 refundable deposit to reserve your spot in the installation schedule or in the next solar farm.
- After it is installed, finish paying and claim a federal tax credit, if desired.
- Enjoy clean solar electricity for generations to come!
Where can I find more information? Ask questions to a real person?
Please contact: Zach Nugent at [email protected] or 207-712-2511