Cash Incentive For Solar Panels

In line with the government's recent commitment to provide cash grants in lieu of investment tax credits (ITCs) for solar and some other renewable energy resources - a program designed to rescue solar startups and other firms who lack the "tax appetite" to take advantage of such tax-based programs - the Snohomish County (Washington) Public Utility District, or PUD, is now also offering cash rebates to customers who install solar panels and solar hot water heaters at their homes or businesses.

One of the unfortunate effects of the recession, according to tax lawyer Travis Blais with Mintz Levin, is that many new firms are so capital-intensive that they don't owe taxes, leaving them in the position of having to bypass renewable programs offering tax credits at both the federal and local level.

The same is true, though to a lesser extent, among ordinary taxpayers, who may have lost one household income, money on investments or retirement funds, or simply had their tax base carved out by a dismal economy.

In any case, with the Snohomish County initiative, participating individuals can qualify for either cash rebates of about $1,500 for a typical solar system (or $500 per kilowatt installed), or loans at 2.9 percent interest loans up to $25,000.

The cost for an installed system in Western Washington State averages $8,500 to $11,000 per kilowatt (kW) installed, with costs going down as kilowatts of installation go up. A 1-kilowatt solar system located on the roof, facing south, under optimum solar exposure conditions, will generate about 1,100 kilowatt-hours per year, or slightly more than one month's electricity usage for the average family.

The PUD program, known as Solar Express, stipulates only that the installation use new, UL-listed equipment and be grid-tied to the PUD with a net metering agreement in place. PUD rates vary from 7.72 cents per kilowatt hour in winter to 6.91 cents in summer, and production incentives range from $0.15 to $0.54 per kilowatt-hour, depending on equipment used. Such incentives are capped at $5,000 per year.

In the first three months of the Solar Express program, 26 households and one business applied. The PUD does, however, have a net cap of 3.638 megawatts of installed solar capacity, so the cash incentives, loans and production incentives are not open-ended.

The PUD is so enthused about solar, they began installing their own system about two weeks ago. This 54-panel installation is expected to generate 10,700 kilowatt-hours of electricity per year, or enough electricity for an average home, though just a fraction of the power needed to run the utility's headquarters.

An interactive kiosk measures daily, weekly, monthly and yearly output, and the $70,000 design, installation and commissioning, under the auspices of Whidbey Island-based Whidbey Sun & Wind, will be open to public tours at the PUD's main office in Everett throughout the year. 

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