We receive a lot of great questions from university Professors and others in the university community regarding the Community Solar Farms program. Below are excerpts from actual questions received by us.
1. “I have gone through the terms a few times and it feels like I should know what I am getting into, why all these legal terms, what are the risks?"
1) Why all these legal terms?
The retail power sector is highly regulated. Regulators require disclosure of all possible risks whether likely or not. Therefore, to adhere to these regulations a significant amount of disclosure is required in the form of legal terms.
2) What am I getting into?
You are not getting into any long-term commitment and can cancel any time with no penalty (with 90 days’ notice).
What you are getting into is a subscription with a local community solar farm, not an energy company. Ampion, which handles the billing, is a Public Benefit Corporation not a for-profit corporation.
3) What are the risks?
The main risk is a misunderstanding of the amount of savings you will receive. You get a 10% savings on the energy produced by the solar farm not on your entire utility bill. If you are allocated 90% solar energy of your average utility bill then potentially you could get a 10% savings on 90% of your utility bill. However, since the energy produced by the solar farm will be lower in the winter months the amount of solar energy will not likely be 90% of your average utility bill every month.
For example, if some months the solar energy is 25% of your utility bill, then you will get a 10% savings on that 25% not on the 90% of your utility bill. If you keep your expectations realistic, however, you minimize this risk.
2. “I get notices from different companies…don’t know how to figure out which ones are truly ethical and trustworthy.”
-The key distinction is whether the notices you get are from an ESCO (Energy Service Company). You will find most of them are. They have developed a bad reputation because these are for-profit companies often using hard sell tactics. They have been criticized for their “bait and switch” contracts which lower electricity bills initially but then raise them significantly later in multi-year commitments. Some consumers felt these terms were not clearly disclosed; it left a bad taste in their mouths.
[Note: We do not want to leave you with the impression that all ESCOs are untrustworthy. For example, one such trustworthy ESCO is Liberty Power. There are many others].
-In contrast, the company I partner with (Ampion Renewable Energy) is not an ESCO. They have been around since 2012. We chose them as our partner specifically to address the issue of trustworthiness for the University community. In fact, Ampion is NOT a for-profit company at all. It is incorporated as a Public Benefit Corporation (PBC). This is a special category of company the primary purpose of which is the furtherance of a social or environmental cause; even when the cause is at the expense of maximizing profits for shareholders. In Ampion’s case that singular cause is providing access to clean, renewable, energy.
-Unlike an ESCO, Ampion’s Community Solar contract is simple and transparent. You get a 10% discount off your electricity bill, from NYSEG, for your share of power produced by your solar farm. That is it. No long-term commitments (cancel any time with a 90-day notice). No gimmicks.
Your utility bill from your current provider will have a separate section which shows these credits producing the discount.
-Does this sound too good to be true? Yes, it does sound that way. However, it is not. The disconnect is that the “savings” comes from solar tax credits. New York State regulations provide tax credits for solar energy. Utilities in New York State are required to buy these credits to offset their “dirty energy.” The money that is paid by the utility to the solar farm - for these credits - is what provides the discount to consumers.
3. “What is Solar PlanetRenewal’s involvement in this ? Are you creating a startup to help people figure out what works for them?”
-Solar PlanetRenewal has affiliated with partner institutions representing one of the largest networks of Community Solar Farms in the United States. For example, one of the solar farms in our network provides Vassar College with 15 percent of its electricity needs through a community solar project 12 miles west of the campus. The agreement is part of the college’s ongoing efforts to achieve carbon neutrality by 2030.
-There are many players in the Community Solar arena:
1.Farmland owners
2.Solar Panel manufacturers
3.Banks and financiers of solar farms
4.Developers of the solar farms
5.Managers of the solar farms
6.Buyers of the solar power (your local utility)
7.Brokers who connect the farms to consumers and deal with billing (Ampion)
8.Independent third-party consultants. They provide objective education to consumers and businesses, helping them evaluate their alternatives and what works best for them. They also provide access to trustworthy institutions to participate in Community Solar. Finally, they act as an independent point of contact for issues and concerns. All of this at no additional cost to the consumer.
-We are #8. As noted, you do not pay more because of our involvement. Our compensation is baked into the pricing which comes out of the involvement of #1 - #6 above.
-Is Solar PlanetRenewal a start-up? Yes and No.
No, it is not a start up in the sense that the parties you will be dealing with (NYSEG, Ampion) have been in this business for several years. They are some of the largest and most established players in the solar energy field.
Yes, in the sense that Solar PlanetRenewal is a new type of player which fulfills a need our customers have been asking for. That need is for an objective consultant to promote the cause of Community Solar while educating consumers on their alternatives.
4. “Why should I choose Community Solar over solar panels for my main residence ?”
With Community Solar you don’t have to deal with the expense and hassles of buying and maintaining solar panels. Nor do you have to deal yourself with the complexities of selling into the grid or dealing with tax credits.
5. “Is there a charge for enrollment or cancellation?”
-No. There is no enrollment or cancellation fee.
-We do ask though that you provide 90 days’ notice to cancel.
6. “I don’t know. I don’t like change.”
- There is not much of a change.
- You will continue to receive electricity from your local utility.
- Your existing utility bill will reflect the credits you get for participating in the Community Solar program.
- You are helping your utility. Through these solar farms your utility is gathering solar credits which are required by regulation. They pass on some of the value of the credits to you as compensation for helping them acquire these carbon offsets. This is where the discount comes from.
7. “Does this work if I rent a home or live in an apartment?”
-Yes
-The program was developed because New York State’s sustainability goals will not be met with only homeowners and industry participating. Renters must be part of the solution too. Therefore, Community Solar Farms are the only alternative for renters if they want to be part of the solution.
8. “My university already subscribes to Community Solar Farms.”
-Yes, they do.
-Sometimes they even use university property for solar farming. Cornell University is a good example.
-However, they do this to reduce the university’s carbon footprint. It does not reduce the carbon footprint of Professors, students, or administrative personnel.
9. “You claim that subscriptions to solar farms run out quickly. Isn’t this just a high-pressure sales tactic to get me to apply immediately?”
-No, it is not.
-Solar Farms have a maximum capacity by regulation. This is designed to keep the program local and to benefit the local community. This maximum capacity is approximately 360 households. After these 360 households sign up, there is no more capacity on those farms.
-Another solar farm cannot be created that quickly because it takes years to get the permitting, financing and leasing arrangements in place.
-You can be put on a waiting list. However, it could be years before your credits start.
10. “What’s so special about you? Why is it you have capacity and others don’t?”
-Solar PlanetRenewal teams up with the largest network of Community Solar Farms in New York and one of the largest in the United States.
-Often, you’ll be approached by the developer of a particular set of solar farms. They can run out of capacity quite quickly.
-On the other hand, because of our larger network (we have access to multiple developers) we can often get you access to a solar farm in the next borough over.
-Nevertheless, there are no guarantees when it comes to capacity. We run out too. For example, we have no capacity in greater New York City. That’s why we are currently focusing on Upstate New York.
11. “I still don’t understand how billing works.”
-Your contract for solar energy production is with the solar farm not an energy company.
-Month #1 the solar farm produces energy. The local utility buys both the solar energy produced from the solar farm and the solar tax credits generated by the production of this energy.
-Month #2 the utility bills you - as it regularly does - but subtracts out the number of credits representing your portion of the solar energy produced by your solar subscription.
-Month #3 the solar farm bills you for the solar credits you have received but adds in a 10% discount to the price.
-Notice you pay for the solar energy only after you receive credits directly on your utility bill.
-It is because of this 3-month process that cancellations require a 90-day notice.
12. “What do you mean this is a way to keep funds local?”
-The solar farmer is local.
-The recipients of the discounts are local.
-This contrasts with flyers you will receive which tout “renewable energy.” Many of those companies can use this label if a wind farm in Texas puts energy into their local grid in Texas. In contrast both the producer and consumer are local.
13. "Do I qualify for Community Solar ?; I have rooftop solar which does not cover all my needs."
In New York State a single utility account can only receive renewable energy credits from a single source. If you are already on a renewable energy source (hydro, solar, wind, etc.) which provides renewable energy credits you cannot also be on a Community Solar Farm.
If you want to understand the framework for Community Solar Farms, read our post What is Community Solar Farming ?
Dude this is sweet. My buddies and I always thought this community solar thing was a scam. We had some guy come to our door to get us to sign up. However, you are the first one I’ve seen who explains what we’ve been missing – the utilities have to buy the solar credits and the sale of the credits allow the solar farms to provide the discount. Thanks for this!