| Resource Type | Research Report |
| Author / Source | Chan, Grimley, Stallman, Anderson, Teklinski (University of Minnesota – Twin Cities; National Renewable Energy Laboratory) |
| Publication Date | October 2021 (original publication; June 2024 (NREL reprint) |
| Location | United States; framework applicable nationally |
| Initiative Type | Technology, Program |
| Project Complexity | Advanced |
| Recommended For | Staff, Board |
Estimated reading time: 30+ minutes
Why This Matters for Rural Electric Co-ops
As solar adoption accelerates across all utility types, rural electric cooperatives face a distinctive challenge: deploying solar in ways that are financially fair to all members, including those who don't or can't participate. Without careful planning, solar programs can create cross-subsidies, shifting costs onto non-participating members and undermining the cooperative principle of equitable economic participation.
This report gives co-op leaders a direct tool for that challenge: the Multi-Level Incremental Cost (MLIC) model, developed specifically for cooperatives' federated G&T structure. Co-ops can use this resource to evaluate whether a proposed solar deployment model would produce fair outcomes across their membership, test different ownership and subscription structures before committing capital, and build a defensible, transparent rationale for the programs they choose to offer.
Key Takeaways
| › | No single solar deployment model fits all co-ops. Ownership structure, interconnection level, and rate design all determine who benefits and who bears costs. |
| › | The MLIC model assesses whether a solar project's long-run value equals or exceeds its long-run cost at each level of a multilevel cooperative, helping avoid cost-shifting to non-participants. |
| › | Community shared solar at the G&T level can reduce cross-subsidy risk while expanding member access, but project size and tracking technology significantly affect whether subscribers see net savings. |
| › | Co-ops can intentionally design modest cross-subsidies to advance affordability or low-income access goals, provided those choices are transparent and member-supported. |
Implementation Considerations
- Cost or Funding Requirements: Running the MLIC model requires solar production data, long-run cost projections, and cooperative-specific rate and load data. Smaller co-ops will likely need outside technical assistance or a regional partner.
- Staffing or Technology Requirements: Evaluating equitable solar deployment across a multilevel G&T structure is analytically complex. Staff may need to engage consultants familiar with cooperative rate design, or pursue regional collaboration.
Notable Examples
- East River Electric Power Cooperative (SD): Primary case study; tested both C&I buy-all-sell-all solar and G&T-owned community shared solar using the MLIC model.
- Green Power EMC (GA): G&T that facilitates large-scale solar PPAs for 38 member cooperatives across Georgia; 503 MW deployed.
- Connexus Energy (MN): Deployed solar plus storage (15 MW / 30 MWh) and a community solar program structured to avoid cost-shifting to non-participants.
- Cherryland Electric Cooperative (MI): Targeted 50 low-income households for community solar credits paired with weatherization upgrades.
- Ouachita Electric Cooperative Corporation (AR): Behind-the-meter industrial solar reduced co-op peak demand by 30% and enabled its first rate reduction in 20 years.
- Wabash Valley Power Alliance (IN/MO/IL): G&T-owned community solar at six distributed sites; structured to minimize distribution member risk while maximizing subscription flexibility.
Estimated reading time: 30+ minutes
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