Despite new records for solar power generation being set in the U.S., solar energy’s potential remains largely untapped.
Enter innovative solar startups such as Yeloha, a Boston-based transplant from Israel. Highlighted in a recent Inc. feature, Yeloha has come up with a shared solar business model it says can open up the market for photovoltaic systems to all those who rent housing, as well as others that don’t own or have access to sufficient or well-sited rooftop space or land area.
Yeloha and others working along the same lines appear to be on to something big, something that proponents and supporters of community solar have been promoting for years. In Yeloha’s case, the startup is rolling out its solar-sharing service in select states across the U.S., enabling those currently unable to tap into the humongous amount of energy produced by “that hot yellow ball in the sky.”
Shared solar: Tapping the energy of that “hot yellow ball in the sky”
Despite another record-setting performance last year, solar energy accounted for a mere 0.40 percent of U.S. electricity production in 2014, according to the U.S. Energy Information Administration, Inc. Editor-at-large David Whitford points out. Two-thirds of the 4.093 billion kilowatt-hours of electricity generated across the U.S. last year came from fossil fuels, mainly coal and natural gas; one-fifth came from nuclear. Worth noting: The EIA isn’t able to track growing amounts of electricity from solar PV systems installed on utility customer premises, at least at present.
Shared solar, which enables multiple end-users to share the benefits and costs of on- and off-site solar PV systems, holds out the promise of opening up a path that could lead to 100 percent market penetration, according to recently released research from the Department of Energy’s National Renewable Energy Laboratory (NREL).
For a variety of reasons – lack of rooftop access, insufficient solar energy exposure or space – nearly half (49 percent) of U.S. households and 48 percent of businesses are currently unable to “host a PV system of adequate size or virtually net meter an entire system themselves,” according to NREL’s report.
A P2P network for sharing solar
Sharing economy startups such as Yeloha believe they’ve struck on a sustainable business model that can provide access to shared solar systems for this largely untapped market space. According to NREL’s research report:
“Shared solar could represent 32 to 49 percent of the distributed PV market in 2020, growing cumulative PV deployment in 2015-2020 by 5.5 to 11.0 gigawatts and representing $8.2 billion to $16.3 billion of cumulative investment.”
Clarifying regulations and streamlining procedures associated with installing shared solar energy systems would spur development of new business models and shared solar deployments, such as those being promoted by private-sector startups such as Yeloha, community solar project developers and others, the report authors highlight.
Yeloha’s keen to provide access to shared solar systems for apartment and building owners as well as renters. Its Israeli parent company, Generaytor Inc., recently raised $3.5 million in Series A funding from venture capital investors to get its solar sharing network off the ground.
Yeloha is looking to attract “sun hosts” with suitable properties by offering them free PV installations. “Sun partners” share in the renewable electricity produced by the hosts’ PV systems. Whether hosting or sharing, Yehola solar-sharing network participants will wind up saving money, the startup says.
In addition to free installations, Yeloha hosts’ utility bills will be reduced as a result of the electricity generated by the PV systems, receiving a credit from their electric utility of between 25 and 30 percent of the energy produced. “Sun partners” can continue to share in the electricity produced and utility bill savings as long as they remain in the same utility service area.
Having initially launched the service in Massachusetts, Yeloha is looking forward to expanding across select U.S. states where virtual net metering is in place. “Most people will not go solar; it’s too complicated or expensive,” Wall Street Journal’s Yulia Chernova reported on April 8. Amit Rosner, co-founder of Generaytor and Yeloha, “believes that today’s solar market serves only a very narrow type of customer: those who have a home, don’t plan to move soon, can afford to buy a system or have good-enough credit to lease one, and whose roofs are well-suited for solar,” Chernova continued.
Yeloha is working to raise another $3 million for the limited liability company that will own and operate the PV systems installed at “sun host” sites. That would enable the startup to install about 100 PV systems, which “points to potential limits on how quickly Yeloha’s network could expand,” Chernova added.
*Image credits: 1) Yeloha; 2) NREL, “Shared Solar: Current Landscape, Market Potential, and the Impact of Federal Securities Regulation”