People Power Solar Cooperative in Oakland, California, is leading an effort to demonstrate both the feasibility and the meaningful benefits of community-owned solar, a type of community solar in which residents of a community collectively own a solar system. Because these member-owners are investing directly in a solar project, they earn money as it sells energy, making this solar system a conduit for sharing wealth within the community
In other community solar subscription models, members receive a credit on their electric utility bill. The members of People Power share the financial benefits of the solar system by distributing the revenue it generates through collective dividends, generally in the form of cash. In addition, they have control over how solar projects are developed and installed and have formed project groups to steward the development of similar solar projects throughout California.
People Power Solar Collective was founded with $150,000 in startup funding from the California Sustainable Energy Entrepreneur Development Initiative (CalSEED) as a cooperative corporation. California law allows the formation of this type of corporation if it is organized primarily for the mutual benefit of its patrons. Similar laws exist in at least 18 states, according to the National Cooperative Business Association.
The first project that People Power developed was installed on the home of lora jo foo (foo does not capitalize her name), a long-time clean energy organizer in Oakland. As a labor rights lawyer, foo was excited that community-owned solar was a solution she could say yes to. foo volunteered to host a 7 kilowatt solar array on her home, which helps her household save money on their monthly electric utility bill.
From the utility’s perspective, this system is set up with foo as the single user, although it is controlled by People Power. Through a model similar to a traditional power purchase agreement (PPA), foo pays a monthly bill to People Power for the power produced by the solar panels. People Power then distributes the revenue from foo’s monthly payment among its member-owners.
In the People Power model, member-owners—who may not be able to install a solar system on their own home—invest in a share of the solar panels on foo’s home. Their investment guarantees a 3% rate of return, and more financial benefit can be shared among all member-owners if People Power begins making enough taxable income to take advantage of the Federal Investment Tax Credit.
The project received enough member-owner investments to fully fund the solar array within two weeks. People Power credits the popularity of its pilot project to a hunger for community ownership and governance of renewable energy in Oakland.
“To be able to build wealth, health, and resilience with energy in our communities, it is about how we govern energy, use energy, and relate to energy—that is energy democracy,” says Crystal Huang, co-founder of People Power.
People Power Solar Cooperative has been a member of the National Community Solar Partnership since May 2020 and is one of the organizers of the Partnership’s Financing Community Owned Solar Community of Practice. Find out more about People Power Solar Cooperative and the installation on lora jo foo’s home.