SMUD’s Neighborhood SolarShares program approved for new homes

Program will provide more solar options and increase renewable power sources

Today, SMUD lauded the California Energy Commission's (CEC) approval of its Neighborhood SolarShares program—a program that can provide solar to new developments through an off-site solar project. This community solar program gives new home developers the ability to deliver the environmental benefits of solar energy without having to install it on every rooftop.


"We are thankful that the CEC saw the benefits that community solar programs can provide and are excited to launch this first-of-its-kind program," said SMUD CEO and General Manager Arlen Orchard. "This program provides options to builders and a net benefit to potential homebuyers, all while providing clean power to our community. The state of California and the Sacramento region are facing an affordable housing crisis and our low-cost solar option provides a valuable tool to lower the construction costs of new homes while supporting carbon reduction goals."

The program came to fruition after the CEC approved the 2019 Building Standards which requires all new low-rise residential homes under three stories high to be built with solar starting in 2020. The 2019 Building Standards include provisions for developers to meet the mandate for solar energy on all new low-rise residential buildings through a community solar compliance option or rooftop solar.

Neighborhood SolarShares is supported by 33 legislators, the Sacramento Metro Chamber, the Natural Resources Defense Council, Sacramento Tree Foundation, labor, builders, low-income housing advocates and more.

"Our goal is to provide options to increase the use of renewable energy," said Orchard. "This proposal meets all the requirements and provides an alternative way to provide solar energy for our customers. This is an important program that provides developers and homebuyers with an attractive option and helps us meet our goal of being carbon neutral by 2040."

SMUD's Neighborhood SolarShares program is intended to provide a compliance option to the new home marketplace. The program includes a 20-year agreement with the developer where SMUD provides solar energy to customers from solar arrays connected to the grid. Occupants of the homes must participate in the program until the 20-year term is over and will receive an annual net benefit of about $10 per kilowatt (kW) per year. SMUD will collaborate with builders to offer either community solar or rooftop solar at the point of purchase.

All of the solar provided to the program comes from within SMUD's service territory. Wildflower is 13 megawatts (MW) and located in Rio Linda. All additional resources will be 20 MW or less.

Collectively, SMUD's SolarShares offerings comprise the largest utility green pricing community solar program of its kind in the nation.

Like any other generation resource, SMUD will continuously monitor the operation of all solar generation feeding the Neighborhood SolarShares program.

Benefits of SMUD's Neighborhood SolarShares program include:
• Removing the long-term maintenance and replacement cost risks of rooftop solar.
• Allowing for "tree-friendly" developments— keeping the canopy, while increasing shade, and reducing energy usage for home cooling.
• Guaranteed monthly solar energy for 20 years, even during rainy periods or cloudy weather that does not deteriorate over time like output from rooftop solar systems.
SMUD's Neighborhood SolarShares program also provides community environmental benefits:
• Community solar systems are more economical: They deliver more energy per dollar spent on the generation system—effectively maximizing a community's clean energy investment.
• Community solar systems are well-maintained and monitored, and can be easily oriented to provide more clean solar energy at times when the solar energy is more valuable.

Although this program is a first-of-its-kind for developers, SMUD has provided SolarShares programs for existing customers for many years. In fact, SMUD's commitment to solar and other renewable energy sources dates back decades. SMUD developed the world's first commercial-scale solar photovoltaic power plant in 1984; the first solar-powered electric vehicle charging station in the western United States in 1992; and the first net-zero energy community in midtown Sacramento, featuring rooftop solar and batteries.

SMUD has supported and incented the growth of the rooftop solar industry for many years.
To date, 210 MW of customer-owned rooftop solar has been installed in SMUD's service area, and our energy portfolio includes over 170 MW of utility-scale solar. Over the next three years, SMUD will bring nearly 270 MW of new utility-scale solar online. Our recently adopted Integrated Resource Plan includes over 1,500 MW of added utility-scale solar and we expect to reach over 500 MW of customer-installed solar over the next 20 years. Nearly 1,000 MW of the new utility-scale solar is planned to be built locally. SMUD is also spending over $20 million in the next few years on distribution system software and infrastructure to be able to manage and accommodate the expected increases in renewable energy resources such as rooftop solar.

Today, SMUD's energy portfolio is on average 50 percent carbon free and will grow to 80 percent carbon free by 2030.

"We have a strong commitment to solar energy and intend to continue to build our portfolio of renewable energy sources so we can meet our carbon reduction goals. In order to meet those aggressive goals, we must utilize all available options, and this is just one complementary option to rooftop solar," said Orchard.

About SMUD
As the nation's sixth-largest community-owned, not-for-profit, electric service provider, SMUD has been providing low-cost, reliable electricity for more than 70 years to Sacramento County and small adjoining portions of Placer and Yolo Counties. SMUD is a recognized industry leader and award winner for its innovative energy efficiency programs, renewable power technologies, and for its sustainable solutions for a healthier environment. SMUD's power mix is about 50 percent non-carbon emitting. For more information, visit SMUD.org.
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