Rooftop vs. community solar
Last updated 7/2/2021
There are two primary ways to benefit from solar energy: by installing a solar panel system on your property, or by participating in a community solar project. If you install solar at your home or business, you’ll most likely install a rooftop solar panel system, making use of that otherwise empty space above your head to produce electricity. In the event that you aren’t a good fit for solar, though, community solar allows you to still access the benefits of solar by offering the opportunity to subscribe to, or even purchase a part of, a larger solar panel project in your area.
When comparing your solar options, and specifically rooftop vs. community solar, there are a few main things to keep in mind: what are you actually buying, how are you paying for it, what benefits will you receive, what are the environmental benefits, and what happens when you move/no longer want to participate?
What are you buying with rooftop vs. community solar?
When you buy a rooftop solar panel system, it’s pretty clear what you’re paying for: your solar panels and other equipment will physically be installed on your property, and the electricity generated by your solar panels will go straight into your home (after passing through an inverter).
It can be a touch harder to conceptualize what you get when you participate in a community solar project, but it doesn’t have to be! When you buy into a community solar project, you are paying for the power produced by the solar panels in the community solar farm, just like you’re paying for solar energy with rooftop solar. The only difference is that instead of solar power being produced locally at your home or business, with community solar, the power is produced off-site. It’s the remote working equivalent for solar!
How do you pay for rooftop vs community solar?
There are two primary questions to answer in order to talk through the different options for paying for rooftop and community solar: are you going to own the solar, and do you plan on paying for the solar upfront or monthly?
With rooftop solar, you can either own or lease your system. If you own your solar panel system, you own all of the physical equipment (i.e., solar panels, inverters, and more) and you’ll see the largest financial and environmental benefit from your solar panels over their 25+ lifetime. You can either purchase your system upfront or with a solar loan, paying for your installation monthly, like you would with car payments or a mortgage.
If you lease your system, a third party owns the solar panel system installed on your roof, and you just purchase the power generated by the panels on a monthly basis. In fact, paying for a leased solar panel system is very similar to paying for community solar.
Most community solar projects are designed via a subscription model: you pay monthly for the electricity produced by the community solar project. The way the subscription works, and the reason it’s an attractive investment, is that the solar electricity you purchase from a community solar project is sold at a discounted price compared to what your utility charges. For instance, over the course of the year, the electricity you buy from community solar could cost 10 percent less than what you pay from your utility.
In some cases, community solar projects may also allow you to purchase a portion of the project outright, i.e., a certain number of panels. In those instances, you may pay for your share the same as you would an owned rooftop solar system: upfront or financed with a loan over time.
What financial benefits do you receive from rooftop vs community solar?
With community solar, the financial benefits are straightforward: you’re replacing what you pay your utility for electricity with a lower rate for electricity purchased from the community solar farm. By doing so, you can generally expect to save 5-15 percent on your annual electricity bills.
With rooftop solar, you also benefit financially by using solar electricity to offset what you would have used from your utility company. However, you’re likely to see higher levels of financial savings, especially if you pay for the system upfront.
Additionally, with rooftop solar, you may be eligible for rebates and incentives from the federal government, state government or even your utility. What’s more, installing solar on your home has the potential to increase the value of your home: a study from Zillow found that homes with solar sell for 4 percent more than similar homes without solar.
What are the environmental benefits of rooftop vs. community solar?
Both rooftop and community solar allow you to offset or avoid electricity produced by fossil fuels with solar power, leading to carbon emission reductions, and contributing to improved local air quality.
One thing to consider when comparing rooftop and community solar is that rooftop solar makes efficient use of otherwise ‘empty’ space by taking advantage of otherwise unused square footage on your rooftop. Community solar requires much more acreage and space than rooftop solar, so it’s always a good idea to see what type of land it’s built on: otherwise unusable land (like a former landfill) or land that could have another use.
What happens if you move and have rooftop vs. community solar?
If you end up selling your home with solar on it, then you’ll have to start over with a solar installation at your new home: unlike your favorite couch, you can’t take your solar panels with you from home to home.
With community solar, though, if you move to another home within the same region and, specifically, within the same utility service territory, you’ll likely remain subscribed to the same community solar project. If you’re moving out of state, or somewhere not covered by your same utility, you can either cancel your subscription or pass it to the new owner of your home.
At the end of the day, the most important thing to remember is that both rooftop and community solar are ways to provide affordable electricity for your home, help the environment, and save money at the same time. What’s not to like?
EnergySage is the nation's online solar marketplace: when you sign up for a free account, we connect you with solar companies in your area, who compete for your business with custom solar quotes tailored to fit your needs. Over 10 million people come to EnergySage each year to learn about, shop for and invest in solar. Sign up today to see how much solar can save you.