Market Intelligence
Community Solar
2Q 2026 Market Update
May 7, 2026 5 Minute Read
Federal Policy Update
Federal tax credit construction deadline approaches for community solar projects
The July 4, 2026, deadline for solar projects to begin construction and qualify for federal tax credits is approaching.
- Projects that meet this deadline can secure a four-year window to reach commercial operation, up to July 4, 2030.
- Projects that miss it must come online by December 31, 2027, a timeline that could be challenging given long permitting timelines and interconnection bottlenecks in some states.
The coming months will determine how many high-quality community solar projects successfully safe harbor their tax credit eligibility.
Developers that CBRE works with are prepared to meet the tax credit deadlines. Clients looking to subscribe to community solar will maximize savings from projects with the strongest tax credit positioning.
Illinois
Community solar participation in Illinois is currently limited to virtual net metering
- Community solar capacity within the Adjustable Block Program (ABP) has effectively been exhausted, with waitlists for the Traditional Community Solar award block in both utilities.
- New community solar subscribers in Illinois must now participate through the state's virtual net metering (VNM) tariffs, which operate outside the ABP incentive structure.
- The Clean and Reliable Grid Affordability Act (CRGA), signed January 8, 2026, will soon officially take effect. The Act expands solar and storage rebates that improve community solar project economics, including a $250-300/kW rebate and $250-300/kWh for projects that add storage.
CBRE has projects available for offtake within the ABP as well as through VNM, providing clients with community solar options in both ComEd and Ameren.
Maryland
New bill creates July 1, 2027, grandfathering window for community solar projects
- Maryland's Utility RELIEF Act (HB 1532) was signed into law in April 2026. The bill transitions the state from its current net energy metering program (NEM 1.0), which compensates community solar at the full retail rate, to a successor program (NEM 2.0) with lower compensation.
- The Public Service Commission (PSC) must approve the NEM 2.0 framework by February 1, 2027, effective July 1, 2027. Each program has a 3,000 MW capacity cap, for a combined 6,000 MW across both.
- Projects under development can still qualify for NEM 1.0 if they hold a community solar program queue position and have paid 50% of interconnection fees by July 1, 2027, with commercial operation required by July 1, 2030.
- The PSC can extend both deadlines for permitting delays, utility non-compliance, or force majeure. Projects grandfathered into NEM 1.0 remain on that compensation structure until decommissioned.
Community solar projects that can grandfather into NEM 1.0 and qualify for federal tax credits before July 4, 2026, will maximize subscriber savings. CBRE has access to projects that can meet both criteria.
California
California could extend timeline to design a workable community solar program
- California has historically lacked key political support for community solar. But this could change soon as new leadership at the California Public Utilities Commission (CPUC) and the Governor's office may be more amenable to community solar than their predecessors.
- Assemblymember Chris Ward introduced legislation to establish a community renewable energy program by July 1, 2027. The new bill would give the industry, legislators, and utility regulators more time to agree on a new design that provides meaningful savings to customers.
- Any workable compensation structure will likely favor community solar projects paired with battery storage, which can shift generation to match subscriber demand during evening peak hours.
California may have enough support to pass a workable community solar program soon. CBRE works with developers in the state that are well positioned for a community solar-plus-storage market.
New York
ASAP Act would double distributed solar target to 20 GW by 2035
- Senator Pete Harckham introduced the ASAP Act (S6570), which would double New York's distributed solar target from 10 GW to 20 GW by 2035 and streamline project development.
- The bill has broad Senate support but hasn't been adopted in the Assembly's budget proposal yet. Legislators have until June 4, 2026, to pass the bill, which would expand community solar offtake availability.
- Corporate subscription availability in New York would still be limited by the Statewide Solar for All program, which directs new project subscription capacity toward low-income households.
CBRE has projects in New York positioned for a possible doubling of the distributed solar target. The state’s prioritization of low-income programs may limit corporate subscription availability in certain areas.
States to Watch
Virginia: Governor Spanberger signed legislation in April 2026 expanding the state's shared solar program by 525 MW in Dominion territory and 50 MW in Appalachian Power territory, with capacity releases beginning July 1, 2026. Virginia's minimum bill requirements will likely limit the savings available to larger commercial subscribers.
Pennsylvania: HB 504 has remained in the Senate Consumer Protection & Professional Licensure Committee since House passage in May 2025. The bill must still clear the Senate before the session closes on December 31, 2026.
Ohio: HB 303, the 1,500 MW community solar program, was referred to the Senate Energy Committee on February 11, 2026, and has seen no further action. The current version continues to restrict corporate participation. Ohio's legislative session runs through December 31, 2026, leaving a window for potential action.
Michigan: Community solar bills SB 518 and SB 519 remain in the Senate Energy and Environment Committee with no hearings scheduled. Michigan has a two-year legislative session and has until the end of 2026 to pass the bills.
Failed Bill Proposals
Wisconsin: Assembly Bill 493, which would have authorized a 1,750 MW community solar program, failed to pass as the legislative session ended in March 2026. The bill had bipartisan support and strong corporate backing but faced utility opposition that blocked a floor vote.
Iowa: The community solar bill (HF 2672) failed to clear the second funnel deadline in March 2026 after rural electric cooperative opposition helped block it, despite cooperatives being exempted from the program. Advocates are still evaluating whether to reintroduce a community solar bill in the 2027 legislative session.
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