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Community solar expected to grow 7 GW by 2027, Wood Mac says

Wood Mac increased its forecast for 2022-2026 by 477 MW, due in part because of new policy-enabled community solar markets, such as Deleware and New Mexico. The U.S. currently has 4.4 GWdc of installed solar capacity.
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Community solar capacity in the U.S. is expected to continue its rapid growth, increasing by 7 GWdc by 2027, according to an analysis from Wood Mackenzie.

Wood Mac increased its forecast for 2022-2026 by 477 MW, due in part because of new policy-enabled community solar markets, such as Deleware and New Mexico. The U.S. currently has 4.4 GWdc of installed solar capacity.


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The community solar forecast could increase by another 1.2 GWdc, Wood Mac said, if pending legislation is approved in five states.

Wood Mackenzie and the Coalition for Community Solar Access collected data on customer acquisition costs for the US community solar market and found that costs to acquire large customers are lower, but more variable, on a per watt basis than acquisition costs for residential customers.

Courtesy: Wood Mackenzie

Illinois and New York account for the greatest state-level changes to the forecast. New York is projected to continue to be the leading community solar market, with 1.3 GWdc coming online between 2022-2027.

Report findings also highlighted that community solar-plus-storage can provide grid flexibility, but regulatory models do not currently recognize how these projects can manage load.

“As community solar becomes an increasing share of non-residential projects, developers are contending with high grid upgrade costs to manage this new load on the distribution end of the grid. Community solar-plus-storage could help manage this load and provide grid flexibility, but so far, its scope is limited to a few states, and current rules do not necessarily value storage for its grid resilience capabilities,”  said Rachel Goldstein, US Solar Research Analyst for Wood Mackenzie.

Massachusetts now requires SMART-qualifying facilities larger than 500 kilowatts (kW) to be co-located with storage, while New York’s Value of Distributed Energy Resources (VDER) provides financial incentives for co-locating community solar with storage. 

New regulatory proposals in California could help the state contend with new net metering rules while providing financial advantages for community solar-plus-storage projects.

At present, community solar is taking root in a third of states. The Biden Administration wants community solar to reach 5 million households by 2025 and create $1 billion in energy bill savings.

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