Solar Electric Incentive Status: What's Changing and What's Not

| 3/28/2012 3:23:44 PM

A lot of people have been asking us what incentives are still in place for 2012. The answer: All of them. While there were a few changes in 2011, the majority of programs that will impact the average homeowner remain the same. Here is an overview...

Photo of electric meter by Dever Haffner Ratliffe 30% Federal Tax Credit is still available. Now it applies to your 2012 taxes. It is a credit, not a deduction. If you buy a $10,000 solar system, you can write off $3,000 from your taxes owed. Don't pay enough taxes to get the full amount back? You can take up to 5 years to claim the full amount. Application is simple, just fill out IRS form 5695 and submit it with your tax returns (this applies for the 2011 tax year as well.). This is for Electric Solar Systems and Solar Hot Water. The current expiration date is 2016. 

Production Incentive is still available. This is the payment the utility makes to you for all the power you produce, whether you use it or it goes back out to the grid. They pay you up to 54 cents per kWh, up to $5,000 per year. This payment comes to you once a year in the form of a check from the utility. This is for Grid Tied Electric Solar Systems. The current expiration date is 2020. 

Net Metering is still in place. This is the credit the utility gives you for the electricity you send back to your neighbors. When a solar electric system is installed, we change out your current meter for a bi-directional meter, so it keeps track of what is coming and going. On your utility bill, there will be a credit for the power you send back. This is for Grid Tied Electric Solar Systems. There is no expiration date. 

Photo of Solar Cells by Dever Haffner RatliffeReduced Sales Tax changed a little in 2011. Now the way it works is…systems under 10kw are sales tax exempt. No sales tax is ever paid. On systems larger than 10kw sales tax is paid up front, and you can then apply for a 75% sales tax credit. It is very rare that a residential system is larger than 10kw, so most of you are not impacted by this. This is for Electric Solar Systems. The current expiration date is 2013. 

Accelerated Depreciation is for businesses. 50% of the system cost can be depreciated in the first year, and the remainder over the following 4 years. That is 5 years to 100% depreciation. This is for Electric Solar Systems and Solar Hot Water.

Jarett Lauer
8/30/2012 2:56:15 PM

My name is Jarett and I am an Energy Consultant at SolarCity. If you are interested in locking in your incentives while they are still available, please click this link, input your information and I'll be in contact to provide you with a free customized proposal for your home. Greg, the sizing of the system all depends on how many kilowatt hours you use per year. Some people need 15 kWs to offset their usage, some only need 5. Feel free to give me a call or shoot me an email and I would be happy to explain.

Greg Kinter
3/30/2012 4:45:53 PM

Hello, i was wondering if i could get an explanation why this article states that it is rare for a residential system to larger than 10kw. I have been to a few classes on sizing solar systems and have looked into a few of my own systems and there are a few of them that are going to be over 1o kw and now im not real sure of myself thanks

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