In a major step forward for the growing investment side of our business, Scale has reached an agreement with Gutami to partner on the development of a 500 MWdc community solar project pipeline spanning multiple states. 

For many reasons, we’re tremendously excited to announce the ramping up of our activities in this segment. In addition to our belief that community solar can be a significant part of Scale’s future, we also believe that this project pipeline points the way towards the future of the sector more broadly. 

An opportunity aligned with our values

Community solar projects are typically ground-mounted or large rooftop solar projects of 5MW or less that connect to the distribution grid and allow multiple residential or business customers to “subscribe” to the power it produces. In return, they receive credits on their utility bills that can reduce overall electricity costs somewhere between 5 and 20% in most cases. 

This model expands access to the benefits of low-cost, zero-emission solar power to include renters, homeowners with roofs unsuitable for solar installations, and low-to-moderate income households that may not be able to afford or finance their own installation. As a result, community solar projects have a unique ability to deliver equity benefits alongside the broader environmental, economic, and resilience benefits of distributed solar. 

While community solar may represent new project structures and end-users compared to building on-site microgrids for individual C&I customers, we see it as an opportunity to leverage our expertise in distributed energy project financing and execution within a sector that is closely aligned with our mission to provide the world cleaner, more efficient and resilient power.

Quintupling down on a successful partnership 

Under this latest community solar partnership agreement, Scale will build, own, and operate 500 MWdc of projects developed by Gutami across several states, including New York and California, and it will also provide financing via Scale’s Capital Solutions arm. It’s a quintupling-down on last year’s agreement between Scale and Gutami to finance, build, own, and operate 100 MWdc of community solar projects in New York, and this rapid expansion in capacity as well as geography reflects the success of our partnership and promise of the sector more broadly. 

Community solar projects are almost entirely dependent on state-level policies, which must provide rules for program eligibility, remote or “virtual” billing procedures to enable credits to flow from an off-site project to multiple subscribers, and potentially other details such as carve-outs or minimums for LMI household participation. While New York is an established, relatively mature community solar market, the expansion into other states is a testament to the progress advocates have made in expanding the map for community solar. 

California is a particularly exciting new potential market for community solar, with the California Public Utilities Commission expected to soon issue new rules for community solar that could catalyze as much as 8 GW of projects according to CCSA – more than doubling the 6.2 GW of community solar currently installed nationwide, according to SEIA. Moreover, these rules are expected to include a requirement for battery storage, a first in the US community solar sector that could serve as a model for other states facing grid reliability challenges.

In anticipation of this requirement, the California projects included in our agreement with Gutami will likely be paired with battery capacity. Battery storage is core to the design of nearly all of Scale’s microgrid projects, and incorporating this technology into community solar projects will significantly augment the local resilience benefits they deliver.

Scaling up community solar 

Including this latest project pipeline announcement, Scale’s community solar portfolio is now projected to generate enough power to meet the needs of ~100,000 homes or small businesses while reducing CO2 emissions by around one million tons. Needless to say, we anticipate these numbers to increase substantially in the months and years ahead as we continue to explore opportunities to scale up this uniquely impactful form of distributed energy.