How the community solar low income discount works
Community solar lets a household get credit on its power bill for a share of a solar project it does not own or host, often built on a warehouse roof or an empty field nearby. S.B. 24-207, signed by Governor Jared Polis on May 22, 2024, requires a low income discount on that credit and sets a new reservation for Colorado community solar starting in 2026, so that at least 51% of the capacity in a new facility must go to subscribers the law calls income qualified.
An income qualified subscriber is a household at or below 200% of the federal poverty line, at or below 80% of the area median income, the midpoint income for the region, or enrolled in a program such as the Supplemental Nutrition Assistance Program or Medicaid.
Every income qualified subscriber also gets a guaranteed discount on the value of the bill credit itself, in 4 tiers. The baseline is at least 25%. It rises to at least 30% if the facility earns 1 named federal tax credit tied to where the project sits, and to at least 50% if it earns a separate federal tax credit aimed at delivering savings to income qualified households. A facility that earns both credits at once must give a discount of at least 55%.
Show the numbers
| Baseline | 25 |
| Location tax credit | 30 |
| Savings tax credit | 50 |
| Both credits | 55 |
The reservation jumped from 5% to 51% over 16 years
Colorado passed the first state law in the country letting an outside company build and run a shared solar project, in 2010, called the Community Solar Gardens Act. That law set the income qualified reservation at 5% of new project capacity, and it worked as a ceiling rather than a floor, because thin profit margins gave developers no reason to reserve more than the minimum. Comparing that 2010 requirement against the enrolled text of the 2024 law shows the new floor at 51%, a comparison no single source states directly. That is roughly a 10 fold increase in the guaranteed share, achieved by writing the number directly into the statute rather than leaving it to market incentive.
The law also sets a build schedule for utility companies. Xcel Energy, the utility with more than 500,000 customers, must add at least 50 megawatts of new capacity, a measure of how much electricity a project can generate at once, between January 1 and February 1, 2026, and another 50 by February 1, 2027. Black Hills Energy, the smaller utility, must add at least 3.5 megawatts by the same 2026 deadline, and another 3.5 by the same 2027 deadline.
A single facility cannot exceed 5 megawatts, unless it sits on a rooftop, a parking lot, a former industrial site, or combines solar with farming, called agrivoltaics, in which case it can reach 10 megawatts. No 1 subscriber can take more than 40% of a facility.
Source 3 names Xcel Energy and Black Hills Energy against the customer count thresholds source 1 sets in the statute.
Show the numbers
| Xcel Energy by February 2026 | 50 |
| Xcel Energy by February 2027 | 50 |
| Black Hills Energy by February 2026 | 3.5 |
| Black Hills Energy by February 2027 | 3.5 |
Where Colorado ranks, and who is celebrating
Colorado had about 210 megawatts of installed community solar capacity as of 2024, far behind the more than 2,100 megawatts installed in New York over the same period, despite passing the first law of its kind in the country 14 years earlier.
All Coloradans, regardless of income level or homeownership status, should be able to participate in the transition to renewable energy.
Steve Fenberg, President of the Colorado Senate. Source 2.
Colorado led the nation in 2010 when it became the first state to pass legislation truly enabling a third party community solar program model.
Kevin Cray, Mountain West Senior Director at the Coalition for Community Solar Access. Source 2.