OVERVIEW
There are a variety of incentives available from federal, state and local governments as well as local utilities that can substantially bring down the overall cost of a solar installation. The status of each of these programs changes on a regular basis, and the way in which they interact can be confusing. Our staff is directly and intimately involved in the policy-setting process at each of these organizations, and we can provide you with the latest information on how they can impact your particular project.
Let EI Solutions help you take advantage of today’s many incentive programs
Among our customers, the incentive programs most frequently used are:
Federal Tax Credit – The US government provides a tax credit of 30 percent of the total cost of a solar electricity system. This credit is set to expire at the end of 2007, and we are working actively with the Solar Energy Industries Association (www.seia.org) to get Congress to extend it.
Self-Generation Incentive Program (California, through 12/31/06) – Each of the investor-owned utilities in California operates a program in which anyone installing a system greater than 30kW in capacity can qualify for a rebate, currently $2.50 per watt. Details on these programs can be found in the Self-Generation Incentive Program Handbook. This program is set to expire at the end of 2006 and will be replaced by the California Solar incentive (CSI).
Municipal and Other Utility Programs – Other utilities in California and utilities and governmental agencies in other states also offer incentives of varying types. North Carolina State University maintains the Database of State Incentives for Renewable Energy (DSIRE) where you can find additional information about your area.
California Solar Incentive (CSI) (beginning 1/1/07) – Starting January 1, 2007, the ten-year program to encourage widespread adoption of solar energy in California will begin. The details of this program, including the specific incentive levels for various-sized projects, are still being worked out. One key difference between previous programs and the CSI is that all incentives will be based on the actual or expected performance of the system installed. For larger projects, incentives will be paid for each kilowatt-hour generated over the first five years that the system operates. For smaller projects, the system’s performance will be estimated based on various factors including the direction and angle the panels face, the amount of shading and other key variables, and a single, up-front payment will be provided based on that estimate. The California Public Utilities Commission maintains a web site with the latest information on this evolving program.
In a parallel initiative, the State of California will require all municipal utilities to offer a similar program beginning in 2008. Each utility will be required to devise its own incentive program over the next few months. If you are a customer of a municipal utility, we can work with you to determine when and how these programs might benefit your project.
Renewable Energy Credits (REC) – Each kilowatt-hour of solar electricity a system generates contains two attributes. The first is the electricity itself, identical to the “brown” electricity generated from fossil fuels. But all forms of renewable energy, including solar, also have “green” attributes – most importantly, the amount of pollutants that are not released into the atmosphere. These attributes are often highly valued in the marketplace, particularly in locations where local utilities are required to derive a certain percentage of their total generation from renewable sources. The renewable attributes are measured in the form of “green tags” or “renewable energy credits.” For those solar owners who wish to capitalize on the value of the RECs they generate, markets are beginning to develop in various parts of the US and around the world. We can help you determine if a REC sale is appropriate for you and, if so, facilitate this transaction.