The idea that solar and cities don't mix is about to change.

While much of the country has experienced a solar boom during the past 10 years—with jobs doubling, costs dropping precipitously and installations growing exponentially—New York City has largely missed out. That's unfortunate because the city has all the key ingredients: millions of acres of roof space, high energy peaks and a growing demand for electricity. It also suffers from some of the worst air pollution in the country.

In fact, Mapdwell, using 3D modeling and visualization technology combined with aerial data, estimated that the city has the potential to power 1.2 million homes with solar—the equivalent of planting 185 million trees in terms of offsetting carbon emissions—and drive $40 billion in business investment. To date, New York City has less than 200 megawatts of rooftop solar, which is less than 0.2% of its potential.

Cities are where the load is, as we say in the energy business. It's imperative that the industry figures out how to install solar in urban areas, which are home to 63% of the population, and help residents and businesses invest in solar power.

Urban solar has been challenging. Cities have more regulation and a thicket of building codes, which drive up installation time and cost. Putting panels on New York City rooftops is often more expensive than on single-family suburban homes or in rural areas, where large systems can be mounted on the ground. The high cost of labor in urban areas and the shade from neighboring buildings can make solar margins even thinner.

But the biggest issue has been that cities don't fit with the business models the industry uses to finance and sell solar. Most New York City residents live in multifamily housing, so the standard rooftop solar-ownership model just doesn't work. Furthermore, building owners often don't shoulder the full electricity load. Instead, it is shared by residential and commercial tenants.

Simply put: When people don't own their roof, they can't decide to get rooftop solar; and when the roof owners don't pay the utility bill, they have no incentive to save electricity.

We need a model that makes it worthwhile for building owners to install solar and a mechanism that allows residents and businesses to purchase that power.

New York City has seen some innovative attempts at figuring that out. One project has neighbors banding together in solar cooperatives. Another allows neighbors to trade energy among themselves. These are great efforts, but they're not easy or simple enough to spur mass solar deployment.

Community solar could be the solution that cracks open the New York market. It allows a solar project to "sell" the energy produced to any business or resident in the same utility area. For example, an apartment dweller in Manhattan could buy solar power from a community project in the Bronx. A solar-system owner would have millions of potential customers.

That business model makes solar profitable for everyone. It offers building owners a return on their investment to make installing rooftop solar worthwhile. Community endeavors ensure that a project has enough subscribers to financially support it and benefit from its energy.

It also works for residents. Community solar subscribers at CleanChoice Energy, for example, pay no upfront or maintenance costs and need not own a roof or even have one suitable for solar panels. Subscribers get credit on their electric bill for the power generated by the project they support and may pay less than the cost of utility power.

New York City and the state have stepped up to jump-start this solution. Gov. Andrew Cuomo's comprehensive energy strategy, "Reforming the Energy Vision," has spurred community solar innovation. In 2015 his Community Distributed Generation Program bolstered the opportunity for residents to participate in the solar market whether they rent their home, live in an apartment building or own property unsuitable for solar panels. NY-Sun provides property-tax and other incentives for clean-energy development. Mayor Bill de Blasio's OneNYC and other policies have sped permitting and incentivized solar installation. The city and the state are working together to make it happen.

We know urban community solar can work because we're pioneering it with one of the city's first projects—a 100-kilowatt rooftop installation on a commercial building in Gowanus. The Carroll Street Solar Farm, pictured above, in which we are partners, will be the first of a flood of New York projects during the next several years.

If solar can make it here, it'll make it anywhere.

Tom Matzzie is founder and CEO of CleanChoice Energy. Peter Davidson is founder and CEO of Gotham Community Solar. They are partners on Carroll Street Community Solar Project.