When discussing areas of utility-scale solar growth during a panel at Solar Power International, Mathew Ricci with national utility contractor Arraycon mentioned the Midwest getting a boost in construction thanks to electric cooperatives. According to the National Rural Electric Cooperative Association, the service organization for America’s electric cooperatives, ratepayers that belong to cooperatives are voting to add solar to the mix, and it seems like this type of utility is growing community solar in a big way.
There are around 900 co-ops in 47 states serving around 42 million customers, according to NRECA. Co-ops are established in rural areas that don’t have an investor-owned or municipal utility nearby to supply electric power. A number of them are based in rural Texas and Alaska.
“We are not accountable to shareholders or local governments. We are accountable to our members,” said Tracy Warren, senior communications manager for NRECA. This freedom opens them up to experiment with new technologies much more quickly than the more bureaucratic, public or investor-owned utilities.
By the end of 2017, the total solar capacity of rural electric co-ops will be five times the amount just two years ago, according to NRECA. In the past two years, co-ops have expanded their solar footprint from 34 to 44 states.
“Electric cooperatives continue to aggressively pursue solar as an energy source and are the leaders in the community solar,” said NRECA CEO Jim Matheson in a statement.
Co-ops are leading in solar because of a multitude of reasons, with the main one being that co-ops have a mission to serve their members. And many members want renewables.
NRECA surveyed its co-op members in December 2016 and January 2017 to identify the factors driving their decision to offer or support solar programs, including community solar, utility-owned solar and rooftop solar. It found 68% were motivated by a desire to increase consumer satisfaction; 59% were motivated by consumer demand for solar offerings and 43% were driven by the decline in the cost of solar development.
One such co-op is Holy Cross Energy, which serves the Western Colorado counties of Eagle, Pitkin, Garfield, Mesa and Gunnison. Lisa Reed, power supply analyst for HCE, said the co-op sent out surveys to its members in the early 2000s and found they wanted more green, environmentally responsible power. So in 2004, it added a rider to customers’ energy bills where 2% of the members’ electricity charges were collected into a “We Care” fund. That fund now helps to pay for customer solar rebates, currently at 75 cents per watt.
Holy Cross’s membership sits at opposite ends of the income spectrum—from rural ranchers in Rifle and Parachute to wealthy residents of resort towns Vail and Aspen. Reed says both groups value solar—albeit for slightly different reasons.
Wealthier residents often install solar to offset high permitting fees—and in the town of Basalt, residents are required to offset any exterior energy uses (like melting snow or heating garages) with 100% renewable energy. Ranchers, on the other hand, support solar primarily for environmental reasons, Reed said.
“Solar still is not the cheapest power. It’s still being paid at a premium,” Reed said. “And I think because we are a cooperative and we had listened to our members and that’s what our members want, they as a majority are willing to pay that extra premium to get the solar in.”
Reed said it’s very important for co-ops to find ways to add solar that don’t harm the membership by increasing rates to prohibitive costs.
Although co-ops may be leading in community solar, according to NRECA, 62% of co-op-owned generation is still coal-fired, while natural gas accounts for 26%, nuclear power 10% and renewables just 2%.
Another reason solar can work well for co-ops is their geography. Co-ops were made to serve rural populations, which inherently come with lots of space.
“If you’re working in a rural electric co-op service territory, you are more likely to have land available that would be appropriate or optimal for solar project development, particularly pollinator-friendly PV,” said Michelle Moore, CEO of non-profit solar developer Groundswell, which works with many electric co-ops.
NRECA’s SUNDA (Solar Utility Network Deployment Acceleration) co-project manager Deb Roepke said sometimes the co-op already owns the land it will use for solar, and thus already has the property zoned for co-op related business. However, siting is still the biggest variable in terms of time, and siting and permitting can take weeks to years to get done.
“If the utility doesn’t already own land that is appropriately zoned, the best rule of thumb is to develop a good list of criteria for what would make a good site and work with a good real estate broker that can identify multiple options,” Roepke said.
Reed pointed out that Colorado’s HCE doesn’t have the population mass in some locations to install large-scale solar. In those spots, smaller community solar installations serving multiple customers make the most sense. HCE chooses locations where the types of lines and loads won’t be problematic for the grid.
Large-scale solar isn’t out of the question for co-ops, though: One stellar co-op, Ouachita Electric Cooperative Corporation, won SEPA’s Electric Cooperative Utility of the Year in 2017 for constructing a 12-MW solar array in Camden, Arkansas—the first utility-scale solar array built in the state. The project provides approximately 6 MW of solar energy to Arkansas Electric Cooperatives Corporation while simultaneously reducing the peak demand for OECC, according to a press release. The peak-demand cost reduction has lowered the cost of power for OECC’s 7,000+ members.
Co-ops often work together to bring new solar onto their grids.
“All the rural electric co-ops have a lot in common, and they all have access to the same financial tools and the same opportunities as it relates to available USDA programs,” Moore said.
Roepke said collaboration with other orgs is crucial to making community and low-income solar happen.
NRECA is putting co-op collaboration to good use—it has partnered with the National Rural Utilities Cooperative Finance Corporation, PowerSecure and 17 cooperatives on the SUNDA project to develop a standardized “photovoltaic system package” that includes engineering designs, business models, financing and insurance options, and optimized procurement that can reduce the cost of utility-scale solar projects. The project’s goal is to bring the cost of installed solar down to $1.60/Wp and help co-ops develop solar at minimal cost.
One early example of a collaborative, low-cost project was HCE’s 145-kW low-income solar installation in the Roaring Fork Valley in Colorado. The co-op worked with GRID Alternatives Colorado for the installation, and the Colorado Energy Office for financial assistance. Fronius also donated some equipment and helped with the installation. The low-income solar array benefits co-op members who spend more than 4% of income on utility bills.
“Moving into low-income community solar was just kind of a natural transition for us,” Reed said. “To bring what we’d been doing with solar and now combining it with our low-income programs that we already have [allows us] to kind of reach out and do a little bit more.”
Electric cooperatives are paving the way for innovative community solar projects in unexpected places. If NRECA’s estimates are right, their member-driven solar leadership will only keep growing.