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Posts tagged "tax credits"

You Solar Coach is here to give you his best insight on the 2012 solar industry. He expects the combination of tax credits, increased efficiency, cost reductions and major investments from industrial giants like GE and Google to spur even more interest in solar technologies in the coming year.

Solar Electricity Incentives:

For homeowners considering solar energy, 2012 will be a great year to move forward. Strong support for solar continues with a 30 percent Federal Tax Credit and a $1,000 Arizona Tax Credit.

Arizona Public Service (APS) customers are probably aware that the APS rebate has decreased from $1.00 per watt of installed power to $0.75 per watt. The good news is that the price of solar has decreased more than the rebates. Solar electric costs were as high as $7.80 per watt when the APS rebate was $3.00 per watt. While the APS rebate has decreased by $2.25 per watt, the installed price of solar electricity has decreased by about $4.00 per watt.

As the price of solar continues to decrease, all rebates and incentives will gradually disappear, which is great news. This is central to the concept of sustainable energy!

Solar Panel Efficiency:

Silicon-based solar panels continue to be the technology of choice for residential solar systems. As demand continues to grow, fierce competition among solar panel manufacturers continues to expand. One facet of that competition is the incremental improvements in solar panels.

While maintaining the same dimensions, panels have gradually grown from about 165 watts per panel to 240 watts per panel in the past 3 to 5 years. The advantage to homeowners is that they can get the same power output with fewer panels. Fewer panels means lower costs for labor and materials and, ultimately, lower costs for the homeowner.

Researchers continue to develop new solar electric technologies. Although many of these technologies hold great promise for the future, residential solar is expected to rely on silicon technology for the foreseeable future.

Silicon solar panels have no moving parts and come with a 25-year performance guarantee from the manufacturer. Now that we have several years’ experience with residential solar, many industry observers predict that silicon panels will easily last for 50 years.

Manufacturers’ performance warranties usually guarantee loss of productivity of panels of less than 0.5 percent per year. Again, industry observers say that productivity loss is actually 0.1 percent or less. So those silicon panels on your roof are likely to meet your home’s electricity needs for many years.

Solar Industry Developments:

The lowest cost solar panel technology is Cadmium Telluride, CdTe, dominated by First Solar. First Solar supplies panels to utility scale solar projects and has not been a supplier to the residential market.

In 2011, General Electric announced that they will enter the CdTe solar market with the largest solar panel manufacturing plant in the U.S., which is currently under construction in Aurora, Colorado.

This is great news for the solar industry to have an industrial giant such as GE entering the market. Even though First Solar has the low cost process, GE obviously plans to meet or exceed First Solar’s quality and price and still make a profit. With GE making such a large investment in solar, solar is no longer a small market, but a worldwide juggernaut industry.

Major Industry Leaders:

Go Green with Solar Google has become perhaps the most visible leader in adopting solar energy. Google’s investment in solar to date is about $1 Billion. Google has installed solar to meet their internal power requirements and has invested in Solar City. Solar City has been able to expand their business to the US east coast states with the investment from Google.

Solar Coach Corner is a weekly column by Arizona SmartPower’s Solar Coach. These posts will go up every Tuesday and are meant to spark conversation about clean energy and energy efficiency topics, so join in by submitting your own comments below!

U.S. homeowners looking to save money with solar energy may find that the road to residential solar energy has a steep learning curve and is filled with potholes, detours and wrong turns. Fortunately, a solar roadmap has been constructed by reliable sources.

Check out this map to find solar mile markers in your state: http://www.dsireusa.org/

North Carolina State University maintains the above website, which provides a comprehensive database of solar information for all U.S. states and territories. The database contains information about solar rules, regulations and policies for each state. Perhaps the most helpful aspect of the website is the list of incentives available for residential solar energy.

All U.S. taxpayers can take advantage of the 30 percent Federal Tax Credit for residential solar electricity. The N.C. State roadmap provides a list of financial incentives specific to each electric utility. These incentives are usually in the form of tax credits, utility rebates and financial incentives from cities and local governments. Some states provide “performance based incentives” such as feed-in tariffs. With feed-in tariffs, homeowners receive a premium price for electricity generated from renewable sources.

Germany has used such tariffs to become the world leader in solar energy: http://rredc.nrel.gov/solar/calculators/PVWATTS/version1/

The U.S. National Renewable Energy Lab maintains a website, PV Watts, which provides a Performance Calculator for Grid Connected PV Systems. This website can be used to predict the amount of electricity produced by a solar electric system for every U.S. geographical location based on the solar system size and installation criteria.

Homeowners can use this website to provide an independent estimate when considering installation of a solar electric system.

Homeowners need not be intimidated when considering an investment in solar energy. There are so many reliable data resources that can be used to evaluate costs and benefits of solar. Homeowners familiar with information from these sources can proceed with confidence when talking with solar energy providers for their homes. 

If you are considering solar and have additional questions, please contact me, your Solar Coach, at dbacon[at]smartpower.org.

Solar Coach Corner is a weekly column by Arizona SmartPower’s Solar Coach. These posts will go up every Tuesday and are meant to spark conversation about clean energy and energy efficiency topics, so join in by submitting your own comments below!

The holy grail of solar electricity is grid parity. Grid parity has been defined as the solar price point where the cost of obtaining electricity from solar is equal to the price of electricity from the grid.

Solar skeptics would have you believe that grid parity is a long ways off, but it appears that we’ve already reached solar grid parity here in Arizona!

One of my Arizona solar customers recently shared his solar financial records with me because he was so impressed by the results. So was I!

The following is a breakdown of solar financing options, including the fully prepaid lease option that led my customer to reach solar grid parity:

The homeowner had obtained his solar electric system through a prepaid solar lease, one of the several financing options that Arizona solar electric installers offer homeowners.

Leases like this come with a variety of options, from monthly lease payments to fully prepaid leases. Homeowners using the monthly lease payment method find that the sum of their payment and residual electricity bill are less than their pre-solar electric bills. Savings are less than those obtained from a purchased system, but no up-front payment is required.

Homeowners who utilize the fully prepaid lease usually do so because they have tax obligations too low to effectively utilize Federal and State Tax Credits. Prepaid leases offer a final cost comparable to the outright purchase of solar.

The Arizona homeowner in this case obtained solar for his home via a prepaid lease with a one-time payment of $8,125. His contract includes continuous system monitoring by the installer and all maintenance provided by the solar installer.

The homeowner is able to follow his solar system performance in real time on the internet so that, should his solar system underperform the output guaranteed by the installer, he will receive a check to compensate him for the shortfall.

Even more, solar panels come from the manufacturer with a 25-year warranty. Even if the solar installation company were to go bankrupt, the homeowner’s investment is protected by the panel maker.

Below is a “payback” calculation based records of the above Arizona homeowner’s pre and post-solar electric bills, assuming an annual electric a rate increase of 4 percent:

This homeowner’s solar electric investment will be fully recovered in 4 years and 10 months. Since solar panels have a 25 year warranty, the homeowner will receive more than 20 years of free electricity. By any measure, it’s clear that this solar homeowner has achieved grid parity and the highest level of energy independence.