Nearly 30% of all solar power capacity distributed in the United States is owned by third parties, according to the U.S. Energy Information Administration. This excludes utility solar plants producing at least 1 megawatt.
As of September, third-party owners accounted for 3.7 gigawatts of all solar power capacity in the United States. Third-party owners are private companies that offer solar electricity or the equipment to produce it to building owners or tenants, usually with small or no upfront costs. Aside from third-party owners, the other two primary ownership options for solar power include self-financing and utility or public financing.
The EIA recently started including third-party owners in its monthly and annual surveys “to help capture ownership trends across states.” The owners often have “power purchase agreements or solar leases,” and are “defined as energy service providers, independent of how the payments are structured.”
They typically provide more electricity to residences than commercial and industrial companies. Third parties own 44% of distributed solar capacity in the residential sector and 11% in the commercial and industrial sectors. “The residential sector accounts for 56% of distributed solar capacity but 84% of third-party-owned solar capacity,” according to the EIA.
At 4.9 gigawatts, California has the most distributed solar capacity, and one-third of that amount is owned by third parties. Arizona and Maryland have the highest amount of third-party owned solar capacity, with more than half of distributed capacity owned by third parties. Utilities didn’t report any third-party owned capacity in 20 states, and some have laws restricting third-party owners.