Community Solar Schemes in the North West: How They Work

Community solar schemes allow Lancashire residents to benefit from solar energy without installing panels on their own roof. Whether you live in a flat, a terraced house with a north-facing roof, or a rented property, community solar offers a way to access clean electricity at lower cost. Several schemes are already operating or in development across the North West, and the model is growing as energy costs and community interest in renewables both increase. Here is how they work, what they cost, and how to get involved.

What Is Community Solar?

Community solar takes several forms, but the core idea is shared ownership or shared benefit from a solar installation. Instead of each household having its own panels, a larger installation is built on a suitable site – a community building, a school, a farm, or a dedicated solar field – and the generated electricity is shared among members of the community scheme.

The three main models operating in the UK are community-owned solar farms (where residents buy shares in a solar installation and receive annual returns), collective purchasing schemes (where groups of neighbours negotiate bulk discounts on individual rooftop installations), and social housing solar programmes (where housing associations install panels on their properties and share the benefit with tenants).

Each model has different financial structures, benefits and risks. What they share is the principle that solar energy should be accessible to everyone, not just homeowners with south-facing roofs and cash to invest.

Community-Owned Solar Farms

In this model, a community energy organisation develops a solar farm and sells shares to local residents. Share prices typically range from £50 to £5,000, making them accessible to a wide range of budgets. The solar farm generates electricity that is sold to the grid, and the income is distributed to shareholders as an annual return, typically 3% to 6% per year.

Several community solar farms operate in the North West. Community Energy Lancashire has developed projects across the county, installing solar panels on schools, community centres and commercial buildings. The returns are shared with investors and a portion is allocated to a community benefit fund that supports local energy efficiency projects.

The financial return is modest compared to owning your own solar panels, but the investment is accessible, the risk is shared, and you do not need a suitable roof. For Lancashire residents who cannot install their own panels – flat-dwellers in central Preston, tenants in Blackburn or Burnley, or homeowners with shaded or north-facing roofs – community solar offers a practical alternative.

Community solar investments are not risk-free. The return depends on sunshine levels, electricity prices and the ongoing maintenance costs of the installation. However, solar is a well-understood technology with predictable output, making it lower risk than many alternative investments. Most community solar shares are held for 15 to 25 years, matching the useful life of the solar installation.

Collective Purchasing Schemes

Collective purchasing brings together groups of homeowners to negotiate bulk discounts on individual rooftop solar installations. By committing to a group order, participants typically save 10% to 20% on the cost of their system compared to buying individually. The installations are still on each homeowner’s own roof, but the purchasing power of the group drives better prices.

The charity Solar Together, which runs collective purchasing schemes across England, has operated in Lancashire and Greater Manchester. Homeowners register interest, the scheme organises an auction among qualified installers, and participants receive a discounted quote. You are not obligated to proceed if the price does not work for you.

For a typical 4kW system in Lancashire, collective purchasing can reduce the price from £6,000 to £7,000 down to £5,000 to £6,000. The savings are passed directly to the homeowner – there are no ongoing fees or shared ownership complications. You own your panels outright and receive all the benefit.

Parish councils, community groups and local energy organisations across Lancashire periodically organise collective purchasing rounds. Keep an eye on communications from your local council, community energy group or parish council for announcements. Joining a scheme when one is available is one of the simplest ways to get solar panels at a lower price.

Social Housing Solar Programmes

Several housing associations in Lancashire and Greater Manchester are installing solar panels on social housing properties, typically as part of wider energy efficiency upgrade programmes funded through the social housing energy programme. Tenants benefit from reduced electricity bills (the solar-generated electricity is used in the home before any surplus is exported), while the housing association may receive the export income.

The arrangement varies by housing provider. Some install panels at no cost to the tenant and allow the tenant to use all generated electricity. Others use a PPA (power purchase agreement) model where the tenant buys the solar electricity at a rate below the grid price. Either way, the tenant’s electricity bill decreases.

If you are a social housing tenant in Lancashire, ask your housing provider whether solar panels are planned for your property or estate. The trend towards combined insulation, heating and solar improvements through social housing energy programme funding means more social housing solar installations are expected over the next three to five years.

Starting a Community Solar Project in Lancashire

If your area does not have a community solar scheme, starting one is possible but requires commitment. Successful community energy projects typically begin with a small group of motivated residents, support from an experienced community energy organisation, and a suitable site for the installation.

Community Energy England provides resources, networking and guidance for groups starting new projects. Community Energy Lancashire can connect you with existing groups in the county and share lessons from completed projects. Local councils may be able to offer suitable roofs on public buildings (leisure centres, libraries, council offices) for community solar installations.

Funding for community solar projects comes from a mix of community shares (sold to local residents), grants (from bodies like the Power to Change Trust and the Rural Community Energy Fund), and loans (from ethical lenders like Triodos Bank and the Co-op). A typical community solar project on a public building costs £40,000 to £100,000 and generates returns for investors over 20 to 25 years.

The social and environmental benefits go beyond the financial return. Community solar projects raise awareness of renewable energy, fund local energy efficiency advice, and create a sense of shared purpose in tackling climate change. Several Lancashire community energy projects have used their community benefit funds to provide free insulation advice, draught-proofing kits and energy-saving packs to local households who need them most.

Virtual Net Metering: The Future of Community Solar?

Virtual net metering, where electricity generated at a community solar site is credited directly to participants’ energy bills, is standard in many US states but not yet available in the UK. Current UK regulations require community solar to sell electricity to the grid wholesale and distribute financial returns to investors, rather than directly offsetting individual energy bills.

There is growing advocacy for regulatory change to enable virtual net metering in the UK. If implemented, it would make community solar significantly more attractive because the value of electricity credited to your bill (at 24.5p per kWh) is much higher than the wholesale price the community scheme currently receives (5p to 8p per kWh). This regulatory change could transform community solar from a modest investment into a powerful bill-reduction tool.

In the meantime, local energy supply arrangements (where a community solar scheme sells electricity directly to local households through a licensed supply arrangement) are being piloted in several UK locations. These pilots could pave the way for community solar electricity to be supplied to Lancashire households at below-grid prices, creating a genuine local energy market.

Can I benefit from community solar if I rent my home?

Yes. Community-owned solar farm shares are available to anyone, regardless of housing tenure. You invest in the solar farm and receive annual returns, typically 3% to 6%. Your housing situation does not affect your eligibility. For social housing tenants, your housing association may install solar panels on your home as part of an energy improvement programme, reducing your electricity bills directly.

How much can I invest in community solar?

Most community solar schemes accept investments from £50 to £5,000, making them accessible to a wide range of budgets. The typical return is 3% to 6% per year, paid annually over the life of the project (15 to 25 years). The investment is not guaranteed and cannot be easily withdrawn, so only invest money you can afford to lock away. Check the specific scheme’s prospectus for details on minimum investment, expected returns and withdrawal terms.

How do I find community solar schemes near me?

Community Energy England maintains a directory of community energy organisations across the UK. Community Energy Lancashire can connect you with schemes in the county. Your local council, parish council or neighbourhood forum may also know of local projects. Solar Together runs periodic collective purchasing rounds in Lancashire and Greater Manchester – sign up on their website to be notified when the next round opens in your area.