Do you want to own a solar panel in a farm far away?

Business model innovations have been crucial for the solar industry in recent years. Community solar — where people can buy into community and neighborhood solar panel projects — has emerged, as has crowdfunding, where people can buy into solar projects and make back money (or a return) on them.

Now a young startup from Boston called CloudSolar is taking a spin on these two concepts with a plan to build a solar panel farm and enable people to buy individual panels (or even parts of panels) of the farm through crowdfunding, no matter where they live. The group launched an Indiegogo campaign on Wednesday morning to test out the idea and raise money (a $300,000 goal) to build their first solar farm.

As the name suggests, the team is making the analogy with cloud computing and the practice of remotely accessing data and computing over a network. In that way, anyone who buys panels in CloudSolar’s farm can remotely view how much power the farm and their panel(s) are producing and how many carbon emissions are being offset, via a cell phone.

However, that basic analogy with cloud computing starts to break down beyond the name and the mobile monitoring. Owners of panels don’t actually tap into their solar energy (the way you would with a cloud-stored song or AWS computing), and the electricity from the farm is planned to be sold locally to power companies in the region.

In the solar world this remote practice isn’t all that unusual, and some large companies, like Apple, are taking this approach for some of their solar farms. In North Carolina, Apple sells the energy from its solar farms (two of which are miles from its data center there) to Duke Energy to put back onto the grid; Apple counts its data center in North Carolina (legitimately) as solar-powered.

The Topaz solar farm.

The Topaz solar farm.

The CloudSolar team says its first farm is planned for “the Northeast,” and if everything works as planned, other sites could be built in California, too. If they can raise their funds, the group says they’ll build the first solar farm next year.

Now that solar panels are at their cheapest time in history, business models — not necessarily technology — are crucial for the industry. The solar-as-a-service business model — which emerged in recent years pioneered by SunEdison and expanded by SolarCity — now dominates the residential solar industry in the U.S., enabling customers to pay for solar power in monthly increments over decades, instead of paying for the expensive upfront fee of installing the panels. This innovation has opened the door for solar for tens of thousands of home owners in the U.S.

Crowdfunding for solar, while still a very (very) small part of solar project financing, has inspired a wave of new democratized funding models from startups for solar. Because solar systems steadily generate energy over 30 or so years and that power is sold to someone (a homeowner or a power company), investors (and regular people) can invest money into installing a solar project and then can make back a small return on the energy sales each month. Startup Solar Mosaic has gotten a lot of attention for its solar crowdfunding platform.

Solar Farm in Tucson, Arizona. Image courtesy of IBM Research, Flickr Creative Commons.

Solar Farm in Tucson, Arizona. Image courtesy of IBM Research, Flickr Creative Commons.

Then there’s the more charitable-oriented solar project startups like SunFunder, which crowdfunds solar projects in developing off-grid communities where solar power can change lives like Tanzania and Uganda. Like with Solar Mosaic, someone who invests in SunFunder can earn back their money, but making money probably isn’t your main motivation for participating in SunFunder’s campaigns.

CloudSolar’s idea is an interesting tweak on all of these models: community, solar-as-a-service and crowdfunding. But beyond the early adopter market who likes trying out new things on Indiegogo and Kickstarter, I’m not exactly sure what the motivation will be for people to buy into a remote solar farm.

Since the solar farm is probably no where near the panel owner, the motivation of helping your direct neighborhood or community probably won’t be there (though, perhaps CloudSolar could create more of a virtual community). Because the solar panel(s) will be owned by you, there’s not really much of a charitable aspect involved.

The Topaz solar panel farm, that uses First Solar panels in CA.

The Topaz solar panel farm, that uses First Solar panels in CA.

And the money making capabilities at a small scale are pretty basic. For $250, you can buy a quarter of a 250 watt panel (about 62.5 watts), and over 25 years you’ll make back $562, in payments every three months; a half panel is $450 (125 watts) and you’ll make $1,125 over 25 years; an entire panel is being offered for $650 to $750 and over 25 years you’ll make $2,250.

Obviously, the more money you put in, the greater your return. There’s an option to own 15 solar panels for $9,000, and two out of the nine spots for that have already been taken. I could see investors that are clean energy fans opting for these options, but probably not the average person. CloudSolar makes money by taking 20 percent of the money generated from the solar power.

One of the more clear motivating factors for someone to participate in this is, frankly, guilt — or put in a nicer way, someone who is looking to offset their own grid energy or gasoline usage. Offsets are a little controversial because they’re always so complicated.

If you buy one solar panel it would offset the use of your iPhone for forever, or your laptop for over a decade, or driving thousands of miles in a Tesla car. But when it comes to offsetting the energy used by an average house? One panel only offsets the energy used by an average home by about seven months. So, unlike if you had solar panels on your roof or you bought into a community solar program through your utility, one panel isn’t gonna cover you.

It’s arrived: The evolution of clean power & data centers

The world’s largest internet companies are turning to clean power to run their data centers like never before. This month we saw huge clean power deals from Apple, including big solar projects planned in California and Arizona, and a big wind buy from Google to provide local power for its headquarters in Silicon Valley.

But it wasn’t always this way. It’s only been in the last several years that Apple, Google, Facebook and others have been embracing clean power as a viable option to provide a significant amount of power for their data centers, and it’s taken years for the power industry, and the internet companies themselves, to adjust to and learn about this emerging world.

Google/Connie Zhou

Google data center, image courtesy of Google/Connie Zhou

If we take a peek back at this history, we can see how it slowly emerged. Let’s take the state of North Carolina where Google, Facebook and Apple all have some of the largest data centers in the U.S. to power some of their east coast operations. Work in that region provided key learnings for how these companies developed their individual strategies for how to adopt and embrace clean power.

I took my first road trip around the area in the summer of 2012 and wrote about the companies’ complicated relationship with the region’s dirty and clean power options. In late 2013, I took another trip to investigate Apple’s already built monumental solar farms there.

Facebook's data center in North Carolina.

Facebook’s data center in North Carolina. Image courtesy of Gigaom/Katie Fehrenbacher

Back in 2006, when Google first started looking at the state for building its east coast data center (the facility was announced in early 2007), clean power wasn’t at the top of mind for even Google, who later pioneered using clean power and has invested over a billion dollars into it. In those years, North Carolina’s power grid only generated four percent of its electricity from renewable sources, with coal at 61 percent and nuclear power at 31 percent. Google just plugged into the grid there anyways without a working strategy to incorporate clean power.

Gary Demasi, who has helped lead Google’s efforts purchasing clean power for data centers, told me in an interview for that initial story that Google, at the time, was obviously cognizant of the somewhat dirty energy-generation mix of North Carolina, but that Google has “gotten more proactive and aggressive since then.”

All the internet companies have.

Apple's fuel cell farm next to its data center in Maiden, North Carolina

Apple’s fuel cell farm next to its data center in Maiden, North Carolina

Three years later in 2009 when Apple and Facebook were considering building data centers in North Carolina, clean power was still an early idea. It was attractive in some emerging ways, but the state and local utilities weren’t offering the type of clean power options that the internet companies wanted.

That’s why in late 2011 Apple started building its unusual and massive solar farms in the area. Built by SunPower, these solar farms now stretch across hundreds of acres and now generate more solar power than Apple needs for that facility. The company also has a fuel cell farm built beside the data center. Apple agreed to plug into the state’s grid, but it was also generating its own clean power that went back onto the grid and made up for its use of the dirty grid power.

Apple's solar farm next to its data center in Maiden, North Carolina, image courtesy of Katie Fehrenbacher Gigaom

Apple’s solar farm next to its data center in Maiden, North Carolina, image courtesy of Katie Fehrenbacher Gigaom

Apple’s solar farms ended up putting pressure on local utility Duke Energy and the state to recognize that if there was ample clean power provided to these customers from the power grid, then they wouldn’t need to build their own. In late 2013, Duke Energy officially asked the state’s regulators if it could sell clean power from new sources to large energy customers that were willing to buy it — yes, thanks to restrictive regulations and an electricity industry that moves at a glacial pace, this formerly wasn’t allowed.

Now Duke Energy has a clean energy supply program in the state. And just this week, Duke Energy issued a request for proposal asking for project builders to build 50 MW worth of solar projects in the state.

So utilities and state regulators are adjusting to internet companies’ desires, but the internet companies are learning, too. While Apple’s solar farms and fuel cell farm in North Carolina were the first of its kind and ahead of the curve, Apple’s deals with First Solar in California and local utility Salt River Project in Arizona seem somewhat more sophisticated. They’re far larger, and they were done far in advance of construction.

Apple's solar farm in North Carolina. Image courtesy of Apple.

Apple’s solar farm in North Carolina. Image courtesy of Apple.

Apple will buy solar power from First Solar’s planned solar farm in Monterey County via a fixed, low-cost 25 year power purchase agreement, and will also buy solar power from Salt River Project’s farms in a similar way, too. Apple’s CEO Tim Cook has said that the way that the deal in California, in particular, is structured the company will actually save money in power costs over the long term.

So what was once a more expensive, niche source of power has now become a substantial clean power option — and one that now big name internet companies feel more comfortable embracing. In California, utility-scale solar farms — which is basically what Apple is buying from in Monterey County — can be built for as low as $1.68 a watt, according to GTM Research, thanks to a combination of private markets, a decade of lowering technology costs and federal and state incentives.

Google plans to buy 43 MW over 20 years from new wind turbines being built at Altamont Pass

Google plans to buy 43 MW over 20 years from new wind turbines being built at Altamont Pass

Solar panels are at the cheapest time in history. Wind power, too, is similarly cheap. Google’s deal to buy power from the revamped Altamont Pass shows how wind turbines have come down considerably in price and up in power.

Now, the official embrace of these internet companies and clean power is just one part of the story. There’s a whole host of smaller data center operators that can’t afford to deal at the scale of Google or Apple. But Google and Apple are still paving the way for the smaller companies by changing utilities minds that there’s a good business to be had in clean power.

At the end of the day, data centers are only consuming a couple percentage points of U.S. energy. So they’re not necessarily the leading energy problem these days, but since they are owned by influential and consumer-facing brands, they could do a lot to initiate the development of clean power outside of the tech industry.

An increasingly rare type of solar farm goes online in California

When the huge solar farm just outside of Las Vegas called Ivanpah opened up in early 2014, many lamented that this type of solar plant, called solar thermal, could soon become a dinosaur. Late last week another of these large solar thermal farms was officially turned on, and it truly could be one of the last of this size built in the U.S., thanks to a one-two punch of changing incentives and economics.

Large utility-scale solar panel farms use rows and rows of solar panels to directly convert the sun’s energy into electricity. Solar thermal farms, on the other hand, uses mirrors to concentrate sunlight to heat liquid that produces steam and makes electricity from a turbine. These sites are essentially using the heat of the sun to produce electricity.

Abengoa's solar thermal farm Mojave Solar

Abengoa’s solar thermal farm Mojave Solar

Spanish power giant Abengoa celebrated the opening last Friday of a huge 280 MW solar thermal farm called Mojave Solar, built just outside of Barstow, California. The project can provide enough solar power for 90,000 homes in California, and was built across 2 square miles.

Abengoa said the site will generate $169 million in tax revenue over 25 years, provided a peak of 2,200 construction jobs, and now employs about 70 people. California utility PG&E is buying the power from Mojave Solar, and the facility will help PG&E meet California’s state mandate to generate a third of its electricity from clean power by 2020.

Abengoa finished another 280 MW solar thermal farm in Gila Bend, Arizona at the end of 2013. Years ago, power companies were as bullish on solar thermal farms as they were on solar panel farms, which are increasingly being constructed in the deserts of California, Nevada and Arizona.

The Topaz solar farm.

The Topaz solar farm, built by MidAmerican, outside of San Luis Obispo

But a few years ago the price of solar panels began to drop dramatically, from an average installation cost of $5.79 per watt in 2010, according to the Solar Energy Industries Association, to $2.71 per watt in the third quarter of 2014 (this is the average cost blended across all types of installations). Utility-scale solar panel installations can be as low as $1.68 per watt according to GTM Research.

As a result, some power companies that had solar thermal farms planned converted these sites over to solar panel facilities. Other companies that had developed businesses off of developing solar thermal sites cancelled projects in the U.S. that were no longer deemed economical and focused internationally.

A look at the heliostats and 2 of the 3 towers of Ivanpah. Taken from the 6th floor of the Unit 1 tower.

A look at the heliostats and 2 of the 3 towers of Ivanpah. Taken from the 6th floor of the Unit 1 tower.

But ultra cheap solar panels are only part of the headwinds facing large utility-scale solar thermal farms in the U.S. There’s also a couple of important incentives that have been changed as well.

First off, the federal investment tax credit (ITC), which delivers a 30 percent tax credit to solar project developers, is planned to be cut to 10 percent by the end of 2016. While it could be extended, the uncertainty is threatening the construction of utility scale solar farms, using both solar thermal and solar panels. The New York Times noted in an article this weekend that there are no future large solar thermal projects planned in the U.S.

Then there’s the fact that federal incentives in the form of loan guarantees are also no longer widely available for solar thermal plants. When Ivanpah was built, it used a $1.6 billion loan guarantee from the U.S. government to construct its 347,000 mirrors and three huge 450-foot towers. Likewise, Abengoa’s Mojave Solar used a $1.2 billion loan guarantee to finance construction. These types of large loans are no longer regularly coming out of the Department of Energy.

NRG Energy CEO David Crane and Energy Secretary Ernie Monitz cutting the ribbon at solar farm Ivanpah, just outside of Las Vegas

NRG Energy CEO David Crane and Energy Secretary Ernie Monitz cutting the ribbon at solar farm Ivanpah, just outside of Las Vegas

While large solar panel farms are still low cost enough that they could continue to be constructed, solar thermal farms the size of Ivanpah (392 MW, 5 square miles), Mojave Solar (280 MW, 2 square miles), and Solana (280 MW, 3 square miles) are far less likely to get built in the future. (Though, solar panel projects will also be impacted by the reduction of the ITC.)

Utilities calculate how much clean power they need (most likely to meet a state mandate) and then compare it to the cost of building a new natural gas plant, a wind farm or either type of solar farm. If natural gas plants, or other types of clean power, are cheaper than solar thermal facilities, then it’s an easy decision.

But large solar thermal farms could still find life outside of the U.S. They can uniquely store thermal energy at night, providing electricity far longer than solar panel farms without energy storage can.

BrightSource, which is the startup behind the Ivanpah site, recently announced a joint venture with China’s Shanghai Electric Group to build utility-scale solar thermal plants in China. Their first proposed project is to build two 135 MW solar thermal projects in the Qinghai province of China.