Federal Tax Credits

The IRS has an advance proof copy available of the form needed by homeowners to receive a 30% tax credit

Solar in Palm Desert, CA installed by HelioPower

 on a solar power system purchased in 2009 on their primary residence.  Form 5695 for "Residential Energy Credits" can be found here: http://www.irs.gov/app/vita/globalmedia/5695.pdf

The tax credit is eligible for "expenditure for property which uses solar energy to generate electricity for use in a dwelling unit located in the United States and used as a residence by the taxpayer." Please see your accountant or financial advisor for financial and tax information.

Additional source links:
Tax code information can be found here.

Database of State Incentives for Renewables & Efficiency

Source:  Silicon Valley Mercury News, reporter Dana Hull:

With the sun setting before 5 p.m., solar power may be the last thing on your mind these days.

But declining panel prices, a federal tax credit and a state rebate all make now a good time to at least investigate whether solar power might make sense for your home — and your budget.

"If you're thinking that you'd like to go solar within the next few years, right now is the time to do it," said Lynn Jurich, president and co-founder of SunRun, a San Francisco-based startup that provides solar financing for consumers who can't afford the upfront costs of buying their own solar systems. "Panels are on sale right now. There's a sweet spot where the state rebates are still relatively high, but the costs have come down."

And winter is a good season to research solar options, experts say. It's generally a slower time for the industry, which means companies may be willing to give you a better deal.

If you're thinking about going solar, here's a checklist of things to think about:

• Take a good, hard look at your electricity usage over the past year or several months. You probably know how much you pay for electricity every month and have records of the checks or bills paid to PG&E or your municipal utility. But do you know how much electricity you actually use? Electricity is charged by the kilowatt-hour (kWh). Some people use as little as 300 kWh per month; others easily use more than 1,200 kWh a month.

In general, solar is a much better investment for people who use a lot of electricity. And PG&E has a tiered rate structure, so customers who use more electricity are charged more.

Understand how you use electricity," said Sue Kateley, executive director of CALSEIA, the California Solar Energy Industries Association. "Get out your bill and look at the tiered rates. If you don't use a lot of electricity — if you are a Tier One or Tier Two customer — then you really need to do a cost analysis to see if solar is cost-effective."

• Take a look at the roof of your house. How old is your roof, and what kind of shape is it in? If your roof is due to be replaced, you'll want to do that before, or along with, adding solar.
• And is your roof ideally situated for solar? Does it face south? "Shading" is also an issue: your roof should have clear, unobstructed access to the sun for most of the day and be free from shade from trees or other buildings.
• Shop around. Ask friends and neighbors who have already installed solar power if they've been happy with their systems. Learn about financing options: Do you have to have the money for the entire system upfront, or does your installer offer a leasing option?

Interview at least three potential installers and obtain bids in writing before making a decision. Whatever the salesperson tells you should be in writing in the contract.

• If you buy electricity from one of California's three investor-owned utilities — PG&E, Southern California Edison or San Diego Gas & Electric — and you have roof or ground space that gets unobstructed sunlight from 11 a.m. to 6 p.m. year round, you qualify for cash back incentives through the California Solar Initiative.

The California Solar Initiative (CSI) was started in 2006 to provide $3 billion in incentives for solar energy projects by 2016. Rebates for smaller residential systems are given upfront — a one-time payment based on system size. The current rebate level for PG&E residential customers stands at $1.10 per watt. So if you're putting in a 5 kw system, that results in a $5,500 rebate. But as more people apply for the rebates, the incentives are reduced, and many experts expect them to drop further later this spring.

Customers of municipal utilities may also qualify for incentives through their municipal service provider.

• Be sure to apply for the Solar Federal Tax Credit, which allows you to claim up to 30 percent of the costs for a new system. A buyer who installs a $25,000 solar panel system on his or her roof will get $7,500 in income tax credits.
• Consider your long-term electricity needs, and find out if the solar technology you're interested in allows you to add on more panels over time if necessary. A swimming pool, changes in family size or the use of a plug-in hybrid car could vastly change your energy consumption.

Wall Street Journal reporting April 24, 2009…Defying a global trend of weak solar demand, owners of homes and businesses in California installed a record 78 megawatts of solar panels in the first quarter of 2009, the California Public Utilities Commission said Friday.

While solar-panel prices have fallen 25% or more, on average, due to a global slowdown in demand, rooftop solar panels remain in high demand in California, the world's third-largest solar market, the CPUC data show.

The strength of California's solar market is due largely to generous state incentives, coupled with federal tax credits that greatly reduce the cost of installation and the fact that California has among the highest utility rates in the nation, making self-generated solar power competitive with conventional utility power, especially for large users.

The state is spending $3.3 billion to install 3,000 megawatts of solar panels over 10 years.

In a quarterly report on a solar rebate program it administers, the CPUC cited a recent change in the federal tax code that allows homeowners a larger tax credit for solar installations as a factor driving strength in that market.

Solar rebate applications filed with the CPUC in the first quarter hit a new quarterly record for capacity, at 52 megawatts, since the program started in January 2007, while the number of applications was down compared with the fourth quarter, the CPUC said.

To date, customers of utilities owned by PG&E Corp. (PCG), Edison International (EIX) and Sempra Energy (SRE) have installed 211 megawatts of new rooftop solar generation since 2007, the CPUC said. Statewide, California generates more than 500 megawatts of power from solar panels, the agency said.

From USA Today, April 6, 2009: “More states want solar power to be option on new homes”

A growing number of states are moving to require home builders to offer solar electricity and hot-

New home solar power system in California installed by HelioPower

water systems in new homes, right alongside more traditional options such as fancy kitchen countertops and special window treatments.

"It's just like the granite countertop upgrade or the two-car garage or the larger closet — these are options the homeowner can choose to purchase," said Jeff Lyng, the renewable energy program manager for Colorado Gov. Bill Ritter's Energy Office.

In Colorado, lawmakers are considering a bill that would require builders to offer a range of options, from pre-wiring the home for solar power to full installation of a solar system. The legislation would also require builders to tell buyers they can roll the cost of the system into their mortgage, reducing up-front costs, Lyng said.

"What this begins to do is standardize things. We're trying to build Colorado's infrastructure to be ready for solar," Lyng said.

The Colorado proposal has passed in the state House and awaits Senate consideration. Ritter, a Democrat who had solar panels installed at the Governor's Mansion in Denver several years ago, said he plans to sign the bill.

Elsewhere:

•New Jersey lawmakers approved a bill last month that would require builders in developments of 25 homes or more to offer solar panels to home buyers and to discuss during construction the benefits of clean energy.

•A California law taking effect in 2010 will require builders to offer solar panels on homes in developments of more than 50 houses.

•Hawaii, starting Jan. 1, will require all new single-family homes to include solar hot-water heaters, said Russell Pang, a spokesman for Gov. Linda Lingle, a Democrat. Hawaii imports 90% of its fossil fuel energy sources, Pang said. "Living on an island, that's not the kind of thing we want to be depending on."

•New Mexico home builders must offer solar-ready wiring but are not obligated to offer solar installation, under a law that took effect last year.

The federal government is offering a 30% tax credit for homeowners who install solar panels or solar water heaters through 2016, said Karen Schneider, spokeswoman for the federal Energy Star program. The credit covers materials and installation costs, with no ceiling on claims.

Colorado officials hope at least 10% of the 12,000 new homes expected to be built in the state this year have solar systems installed, creating at least 300 jobs for installation technicians, Lyng said.

Daniel Glick, of Lafayette, Colo., helped persuade more than 25 families in his neighborhood to install solar systems over the past several years. Glick said residents agreed to use homeowners association dues to make low-interest loans to their neighbors to cover installation costs. Glick now gets a monthly check from his power company because his home is generating more power than it uses.

"It's not just the right thing to do. It makes economic sense," he said.

Fast Company Magazine brings us an excellent resource to review the projects, including energy, in the Stimulus bill and how the list was generated.  View writer, Chris Dannen, full artile here, "Breaking Down the "Energy" Projects in the Stimulus."

Commercial Solar Power Installation in Poway, CA by HelioPower

Here is an excerpt:

Most of the projects in the the President's $900 billion stimulus package are the kind of public works the government has executed for decades: trains, bridges, and so on. But the "Energy" projects that will be eligible for funding are full of new technologies that have never before been implemented on a large scale. What exactly are they?

According to the House Committee on Appropriations, the House version of the bill reserves "energy" monies for the following project categories.

• $11 billion for R&D devoted to the Smart Grid Investment Program and various energy pilot projects
• $8 billion for loans for renewable energy plants
• $6.9 billion for loans to state and local governments, to help them make general "investments" that will increase their energy efficiency
• $8.7 billion to weatherize HUD-sponsored and moderate income housing
• $2 billion in loans and grants for battery technology
• $1.5 billion for increasing the efficiency of schools and colleges
• $300 million in rebates for consumers who buy Energy Star-rated appliances
• $1 billion to buy alternative fuel cars for federal, state and local government
• $200 million in grants towards electric vehicle research
• $2.4 billion for carbon-capture technology to cleanse fossil fuel energy
• $350 for the Department of Defense to figure out how to power bases and weapons with renewable energy
• $500 million for energy-efficient manufacturing projects
• $300 for reducing diesel emissions.

You can read the House's summary of the bill here.

We know a little bit about the so-called "smart grid" that President Obama is advocating. The smart grid is an energy transmission system that can handle variable energy levels, and can pull energy from homes and businesses as easily as it can send energy there. That makes inconsistent generators like wind turbines and solar panels feasible energy sources, and opens the possibility for hybrid cars and houses to sell back some of their energy to the utility company.

But the details of the other projects are discussed largely in catch phrases and metonyms. To figure out where this money will actually go, you have to dig into the pages of the Main Street Economic Recovery Report, which is a list of potential stimulus projects compiled by the US Conference of Mayors. As I explained in an earlier post, the mayors of America's cities will be the ones sending stimulus ideas to the state-level government, who, in turn, will apply for funding from the Department of Commerce once the stimulus–aka the American Recovery and Reinvestment Act–is signed into law at the end of this week.

But if you want a more Web 2.0 way to explore the mayors' project suggestions, you can check out Stimulus Watch, which has ported the mayors' list, and allows people to vote and comment on the projects.

The mayors' report lists over 1300 "energy" and related project ideas in all 50 states. This is the meat and potatoes of the stimulus package, right here; each idea is summarized with job-creation predictions and cost estimates. It's also the most exciting part of the act, because many of these suggested projects will, if enacted, bring thousands of talked-about "green" ideas to immediate popular use.

Residential solar panel installation in Encinitas, CA by HelioPower

Generous state and utility rebates and now the new Federal Incentive Tax Credit for renewable energy can lift up to 50% off the price of a solar power system for your home or business.  It has never been a better time to invest in a solar electricity system, thus greatly reducing or eliminating your electric bill altogether!

A solar electric or panel system sits atop your roof and generates electricity from the sun!  You use very limited amounts of electricity from your utility company. 

New Federal Tax Credits for buying a Solar Power System just increased to 30% with no cap for either residential or commercial systems. When you combine these AMT exempt Federal Tax Credits with State Rebates, you can save nearly 50% on a new system!

In these volatile economic times we continue to be faced with escalating electricity costs. When you invest in a solar power system your budget is insulated from continued electricity rate hikes. For example, starting in January 2009 SCE will increase your rates by 25% to 30% as a result of higher natural gas and transmission costs. This marks the third rate increase in just four years!

Additionally, a solar electric system will increase the value of your home or business. A recent study from the Appraisal Institute demonstrated that the selling price of homes increased by $20.73 for every $1.00 of decrease in annual utility bills. Using this math, a solar electric system often pays for itself the day it’s installed.

Call the HelioPower sales team at 1-87-SOLAR-888 to get a free on site analysis and customized quote for your rooftop solar power system. 

By Glenna Wiseman

With the extension of the Federal Investment Tax Credits for solar, the mood was jubilant.  Rhone Resch, president of SEIA, relived the exhausting 18 month journey the industry took to get the credits in place.  The legislature turned in a Hollywood style ending in its passage as part of the Emergency Economic Stabilization Act of 2008.   His retelling of the amazing collaborative effort presented a cathartic opportunity for the industry to take a deep breath, fully embody the triumph and now move onto the hard work yet to come.  In fact Resch reiterated a laundry list of objectives SEIA sees as critical to the growth of the solar industry.  Ending his speech, he recalled the recent "Drill Baby Drill" call of the oil industry, urging the industry to replace it with "Go Solar, Baby, Go Solar!"

Talking with veterans of the industry at large, several mentioned the show reminded them of the "dot com" rush.  Lots of investment bankers rooming the aisles looking for the next big idea, etc.  Described as the "solar rush" by some, the industry is indeed poised for heavy growth over the next decade. If this industry matures as most do, you will see consolidation in the ranks and those investing in solar power systems are wise to look to strong entities to supply panels.

Many believe solar to be the "right technology at the right time and place" as our country looks to green up its energy sources and free up the grip of foreign oil on our economy and national security interests. 

California Gov. Arnold Schwarzenegger walked the show prior to its official opening.  "Of course we are now facing tough economic times, but that's why we need to focus on solar and the environment," he said as reported by TheStreet.com.

The environment and the economy are cental themes in Thomas Friedman’s new book, "Hot, Flat and Crowded."  World-renowned author, journalist and three-time Pulitzer Prize winner, Friedman focuses on the role of environmental efforts in his new book, seeing this strategy as central to our financial well-being, among critical benefits.  You can join his online group discussion at http://www.thomaslfriedman.com/.

As part of the Economic Recovery Bill, the Federal Incentive Tax Credits supporting the expansion of solar, wind and other sustainable energy technologies in the United States was passed today on the Hill. 

Breaking news from the Wall Street Journal…"House Passes Bailout Bill on Second Try:"

U.S. House of Representatives lawmakers wary of growing signs of the nation's economic distress voted in favor of a $700 billion Wall Street rescue package on Friday, sending the biggest government intervention in the financial markets since the Great Depression to President George W. Bush for his signature.

From RenewableEnergyWorld.com…"Tax Credits Pass: Renewable Energy Industry Breathes Sigh of Relief:"

After a disastrous few weeks on Wall Street, the renewable energy industry has come out a winner. It seems there's always a silver lining in even the worst developments.

Breaking news, Wednesday, September 24, 2008 from RenewableEnergyWorld.com: "US Senate Passes Renewable Energy Tax Credits, House Could Pass Bill This Week:"

HelioPower commercial installation for Dos Molson in Poway, CA

The United States Senate on Tuesday voted by an overwhelming majority to extend the Production (PTC) and Investment Tax Credits (ITC). The tax measure was passed by a vote of 93-2. Now it goes back to the U.S. House of Representatives where it could be approved later this week.

Under the legislation, the PTC will be extended for one year and the ITC will be extended for eight years. The extensions would be at least partially paid for by a change in the tax code for the oil and gas industry. The bill also contains removal of the US $2,000 cap for residential solar installations. The US $18 billion package is part of a larger tax bill worth approximately US $148 billion.

Breaking news in from Business Wire, September 18…"Clean Energy NOW:Diverse Coalition Calls on Congress to Extend Clean Energy Tax Incentives"

Speakers that span the political spectrum, representing the Clean Energy NOW coalition of more than 200 organizations, joined forces today to call for Congressional action to extend the renewable energy and energy efficiency tax credits before the conclusion of the September legislative session. While the credits are set to expire at the end of the year, this week the Senate Finance Committee announced an energy tax deal–agreeing to an $18 billion package which includes clean energy tax incentives. The full Senate is expected to vote on the measure in the next several days.

"Today, the wind industry is experiencing record growth, and hiring new workers every day," said Randall Swisher, Executive Director of the American Wind Energy Association (AWEA). "Unfortunately, many of those newly created jobs are now at risk, and urgent bipartisan action by Congress is needed to sustain the momentum of this growing clean energy industry." According to a recent study by Navigant Consulting, failure to promptly extend the renewable energy tax incentives places at risk 116,000 jobs in the wind and solar industries and more than $19 billion in clean energy investment.