Issue Update: The JOBS Act and Crowdfunding
Crowdfunding or crowdsourcing is a cooperative approach to financing where many small investments from a large and diverse group of individuals (“the crowd”) collectively finance a single initiative.
The JOBS Act
The JOBS Act may finally allow thousands of regular folks to make a modest return (5-10%) by investing in local renewable energy projects. The Act allows for crowdfunding under the following circumstances:
- The project raises less than $1 million, and
- The project owner discloses certain financial information, such as income tax returns, financial statements reviewed by an accountant, or fully audited financial statements.
- The $1 million limit is the approximate cost of a 200 kW solar project, so crowdfunding could mean a significant boost for community-based solar arrays, especially in states with virtual net metering (allowing those potential investors to share the electricity output).
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