Community solar gardens set to boom in 2016

Community solar projects allow nontraditional solar customers access to federal tax credits.

According to Fortune, the community solar projects market will grow in 2016. Community solar projects include neighborhood solar gardens owned and operated by local residents without access to traditional solar energy sources.

Most multifamily and some single-family dwellings are ineligible for solar installations due to rooftop conditions or permissions. Thus far these types of residents have been unable to take advantage of lowered electricity bills and federal tax credits. However, in certain locations across the U.S., communities have come together to fund and build miniature solar projects. These installations provide renewable energy alternatives to the local electric company.

According to research by Green Tech Media, by 2016 the community solar market is estimated to increase sevenfold. Utility Drive estimated a market increase of 500 percent year over year in 2015. One hundred fifteen megawatts of solar energy capacity were installed in 2015, compared to the 21 megawatts installed in 2014. Eligibility for the Solar Investment Tax Credit may be responsible for the boom.

Solar Outreach outlines the federal policy as a 30 percent tax credit on property expenditures that includes contractor labor costs for onsite prep, assembly and installation, as well as permit fees, inspection costs and developer fees. The credit is set to expire in 2017, unless Congress decides to renew and, until a June 2015 ruling by the IRS, was considered inaccessible by solar garden users.

As confirmed by the Clean Energy States Alliance, the IRS ruled in favor of a single resident invested in the Boardman Hill Solar Farm. Unlike U.S. residents who own their installation and receive full credit, residents with partial investments can reap the full benefits.

More information on U. S. solar market can be found on PennEnergy's research area

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