• AC Power (Alternating Current): A type of electrical current whose magnitude and direction varies at regular cycles. In the United States the standard is 60 cycles per second.
  • Aggregation: The act of grouping customers for a common purpose, such as for bulk buying.
  • Anchor Customer: A large customer participating in a shared solar array, often with good credit or large buying power. The participation of an anchor institutions can reduce costs by helping a project reach economies of scale or by providing assurance to financiers.
  • Array: See Photovoltaic (PV) Array
  • Attached System: A solar system mounted directly on the building, typically the roof. Occasionally systems are mounted on the building façade.


  • Balance of System: Represents all components and costs other than the photovoltaic modules/array. It includes design costs, land, site preparation, system installation, support structures, power conditioning, operation and maintenance costs, indirect storage, and related costs.
  • Behind the Meter: Refers to solar installed on the property of a residence or business for the customer’s own use. The electricity generation from the solar array is used on-site and reduces that customer’s demand on the electricity grid.
  • Bill Crediting: In a community solar model, shares in the community solar array are credited to individual subscribers’ utility bills at a determined rate. The credits may appear as kilowatt hours or they may be a dollar value. The net result is that the credits lower the subscribers’ electric bills.


  • Community Purchasing Program: Also known as Group Buy. An organizing model used by community groups and municipalities across the U.S. to help increase solar adoption through a combination of public education and bulk discounts. Group Buys are typically used to install solar systems on single family homes or systems serving one utility account.
  • Community Solar: Also known as Shared Solar or Community Shared Solar. Under a community solar model, multiple shareholders (owners) purchase one or more solar panels or kW capacity in a centralized array. These shareholders receive financial benefits (credit on their utility bills, cash payments, etc.) from the solar energy production.


  • DC Power (Direct Current): An electrical current whose magnitude and direction stay constant. The photovoltaic cells on solar panels capture energy from sunlight and create DC which must be converted to AC for use in grid-connected applications.
  • Detached System: Also known as a ground mounted system, a solar system that is not attached to a building, but is supported by a structure built into the ground.
  • Developer (Solar Developer): The entity that facilitates the design and build of the solar array. Developers may identify and analyze sites, build financial models, secure funding, and sign up customers. Developers may hire sub-contractors or provide services internally for engineering, installation, or other aspects of the solar development process.
  • Distributed Generation (DG): Power-generating systems located at or near the point of energy consumption. Contrast with centralized generation (large scale power plants providing power for a large number of users).


  • Gigawatt: A unit of power equal to one billion watts, one million kilowatts, or 1,000 megawatts.
  • Grid: The infrastructure of power lines, transformers, and substations that delivers electric power to consumers. The utility grid is owned and managed by electric utility companies.
  • Grid-Connected System: A solar electric or photovoltaic (PV) system in which the PV array acts like a central generating plant, supplying power to the grid.
  • Group Buy: See Community Purchasing Program


  • Hard Costs: The hardware and material costs included in a solar installation.
  • Host Site: The rooftop or land parcel used to host a PV system. In many solar projects, the host site owner is a different entity than the solar system owner. The site owner and the system owner may enter an agreement stipulating payment for site leasing or credits from the PV system via a Power Purchase Agreement (see Power Purchase Agreement below).


  • Incentive: A subsidy or tax credit provided to help reduce the cost of solar.
  • Installer: A contractor that installs solar systems.
  • Insolation: The solar power density incident on a surface of stated area and orientation, usually expressed as watts per square meter.
  • Interconnection: The process by which a generator (solar, wind, gas, etc.) connects and supplies power to the grid.
  • Inverter: A device that converts direct current electricity into alternating current to supply power to an electricity grid.
  • Investment Tax Credit (ITC): A federal tax credit provided to the owner of a solar installation. The ITC allows residential, commercial, industrial, and utility owners of photovoltaic (PV) systems to take a one-time tax credit equivalent to 30 percent of qualified installed costs where construction commences by 2019. The ITC then steps down to 26 percent in 2020 and 22 percent in 2021. After 2023, the residential credit will drop to zero while the commercial and utility credit will drop to a permanent 10 percent. The federal residential renewable energy tax credit (Internal Revenue Code Section 25D) requires that the PV system be installed on a home the taxpayer owns and uses as a residence. Thus it would rarely, if ever, be applicable to community shared solar projects.
  • Irradiance: The direct, diffuse, and reflected solar radiation that strikes a surface, usually expressed in kilowatts per square meter. Irradiance multiplied by time equals insolation.


  • Kilowatt (kW): A unit of electrical power equal to 1,000 watts.
  • Kilowatt-Hour (kWh): One thousand watts acting over a period of one hour. The kWh is a unit of energy.


  • Lease: A legal contract through which a customer buys the power from a solar array, but does not own the panels. Leases often offer a fixed monthly rate for electricity produced by the solar array and no money down for customers.


  • Master Meter: A meter used to measure the entire electricity usage of a multi-family building or other property with multiple tenants.
  • Megawatt (MW): A unit of electrical power equal to one million watts or 1,000 kilowatts.
  • Megawatt-Hour (MWh): A unit equivalent to 1,000 kilowatt hours.


  • National Electrical Code (NEC): Contains guidelines for all types of electrical installations. The 1984 and later editions of the NEC contain Article 690, “Solar Photovoltaic Systems” which should be followed when installing a PV system.
  • Net Metering: A policy whereby utility customers receive credit from their utility provider for excess electricity from an onsite interconnected generator.


  • Orientation: Placement with respect to the cardinal directions, north, south, east, and west; azimuth is the measure of orientation from north.


  • Peak Sun Hours: The equivalent number of hours per day when solar irradiance averages 1,000 W/m2. For example, six peak sun hours means that the energy received during total daylight hours equals the energy that would have been received had the irradiance for six hours been 1,000 W/m2.
  • Peak Watt: A unit used to rate the performance of solar cells, modules, or arrays; the maximum nominal output of a photovoltaic device, in watts (Wp) under standardized test conditions, usually 1,000 watts per square meter of sunlight with other conditions, such as temperature specified.
  • Permitting: The process by which a local unit of government allows for certain development, changes, and activities in their jurisdiction.
  • Photovoltaic (PV): A method of generating electrical power by converting sunlight into direct current electricity using semiconductors.
  • Photovoltaic (PV) Array: An interconnected system of PV modules that function as a single electricity-producing unit. The modules are assembled as a discrete structure, with common support or mounting. In smaller systems, an array can consist of a single module.
  • Photovoltaic (PV) Cell: The smallest semiconductor element within a PV module to perform the immediate conversion of light into electrical energy. Also called a solar cell.
  • Photovoltaic (PV) Conversion Efficiency: The ratio of the electric power produced by a PV device to the power of the sunlight incident on the device.
  • Photovoltaic (PV) ModuleThe smallest environmentally protected assembly of solar cells and ancillary parts, such as interconnections and terminals, intended to generate direct current power under unconcentrated sunlight.
  • Photovoltaic (PV) PanelOften used interchangeably with PV module, but more accurately used to refer to a physically-connected collection of modules.
  • Photovoltaic (PV) System: A complete set of components for converting sunlight into electricity by the photovoltaic process, including the array and balance of system components.
  • Power Purchase Agreement (PPA): A legal contract in which a developer owns and operates a solar array and a customer or group of customers agree to purchase the system’s electric output for a predetermined period.


  • Ratepayer: Another term for an energy customer.
  • Renewable Energy Credits (RECs): Also known as renewable energy certificates, RECs are tradable commodities that monetize the environmental benefits of the renewable power supplied to the grid. One REC represents 1 MWh of electricity from renewable sources. RECs are often a key component of a project’s economic performance.
  • Renewable Portfolio Standard (RPS): Also known as a renewable energy standard, RPS is a policy mechanism that mandates electric utilities supply a specified amount of power from renewable energy sources by a target date.


  • Shared Solar: See Community Solar
  • Soft Costs: Non-hardware costs related to photovoltaic systems, such as financing, permitting, installation, interconnection, and inspection.
  • Solar Farm: An installation or area of land in which a large number of solar panels are set up to generate electricity.
  • Solar Energy: Electromagnetic energy transmitted from the sun (solar radiation). The amount that reaches the earth is equal to one billionth of total solar energy generated, or the equivalent of about 420 trillion kilowatt-hours.
  • Solar Investment Tax Credit (ITC): See Investment Tax Credit (ITC)
  • Solar Resource: The amount of solar insolation a site receives, usually measured in kWh/m2/day, which is equivalent to the number of peak sun hours.
  • Subscriber: In a community solar model, the subscriber pays a monthly fee to the project developer and receives a credit for a portion of the community solar array output. Subscribers can be individual households, businesses or institutions, depending on the project and program rules.


  • Time-of-Use Rates: A utility billing system in which the price of electricity changes depending upon the hour of day at which it is used. Rates are higher during the afternoon when electric demand peaks. Rates are lower during the night when electric demand is off peak. Time-of-use rates foster behavior change in customers when they shift usage to off-peak hours when rates are cheaper.


  • Virtual Net Metering: A billing arrangement that allows more than one customer (usually many) to receive bill credits for the energy production of a shared solar array.