Community Solar or Rooftop Solar: Which is Right For You?

General | By Nelnet Renewable Energy | November 20, 2020

If you’re interested in using solar energy to help support renewable energy use, you may wonder what your options are. While traditional rooftop solar is more commonly known, community solar makes solar energy use possible for those whose homes can’t support solar panels. Let’s learn more about differences between the two.

Accessibility

Community solar has experienced exponential growth in recent years because it makes it possible for more people to support solar energy use than traditional rooftop solar. In order to install rooftop solar, you must first meet several conditions that aren’t required of people who choose to participate in a community solar project.

Table comparing accessibility of rooftop solar versus Community Solar
Item being compared Rooftop Solar Community Solar
Homeownership Required for installing rooftop panels Not required; you can rent or own your home or business
Roof Type Typically work best on south-facing roofs with a slope between 15 and 40 degrees; your roof should be relatively unshaded (Energy.gov) No roof access needed since panels aren’t installed on your property
Credit Requirements Good credit (usually 650+) required to acquire financing for installation Good credit may be required for some community solar projects; the trend is moving away from credit score requirements with community solar sign-up

Lastly, while it’s not a requirement that you stay settled in your home for the next 5 to 10 years, if you move before then, you’re not going to see a return on your investment in rooftop solar panels you install today. With community solar, it’s easy to cancel your contract (or continue it with another project, if one is available at your new address) if you move.

Finances

Rooftop solar requires a significant cost upfront compared with community solar. But does it pay off in other ways? Let’s take a look.

Table comparing finances of rooftop solar versus Community Solar
Item being compared Rooftop Solar Community Solar
Upfront Investment 5-digit cost; the average cost to install solar panels in New York is over $14,000. No upfront cost to sign up
Payoff Period Ranges from 5 to 10 years Immediate monthly savings on electric costs once your project is producing energy
Potential Additional Costs Insurance; potential maintenance and repair costs to solar array Not responsible for repair or maintenance costs of the solar array
Tax Benefits You enjoy the tax benefits (a 30% tax credit on your system through 2022) No tax benefits
Total Overall Savings Maximize long-term savings if you stay in your home Consistent monthly savings as long as you participate
Additional Economic Benefits Increase in home’s value No impact on value

As a homeowner with rooftop solar, you’ll have substantial upfront and potential ongoing costs – with tax benefits. If you stay in your home long enough, you can maximize your savings. With community solar, you’ll pay nothing upfront and see immediate, consistent monthly savings on your monthly energy costs – but no tax benefit. The better option for you depends on your lifestyle and situation.

Ease of Participation

Lastly, let’s look at how easy it is to get started supporting renewable energy with each of these options.

With rooftop solar, you’ll need to get estimates of your property, obtain financing, permits, and insurance, and then get the installation done before you can start to enjoy solar energy. You’ll also be responsible for any maintenance and repairs that need to be done once your panels are installed. You’ll have just one billing statement for electricity per month.

With community solar, you can sign up in just minutes – and you don’t have to worry about any changes being made to your property, additional insurance, or potential maintenance concerns. Depending on the community solar project you sign up for, you may receive two energy bills each month, but you’ll enjoy savings in your overall energy costs. Plus, community solar projects are increasingly moving toward sending just one bill to their subscribers.

Now that you’ve seen the differences between rooftop solar and community solar, which do you think is best for your situation? If community solar makes sense for you, check for an available project with Nelnet Renewable Energy today or contact us with any questions.

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Are you ready to save up to 10% on your monthly energy costs, all while helping the environment? See if you’re eligible to join a community solar project near you. 1

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