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Last Chance for the 30% Federal Solar Tax Credit

What is the Federal Solar Tax Credit?

The Federal Solar Tax credit, also known as the Investment Tax Credit (ITC), is a major federal initiative that supports solar growth throughout the nation. Equal to 30-percent of the total installation cost, the ITC allows homeowners and businesses buying solar to see a much quicker return on their investment.

With no cap, the deduction includes every aspect of a solar installation for commercial and residential projects alike. Should you need to have your roof repaired or replaced in order to go solar, those costs can be deducted as well.

These savings don’t include the added benefits of state incentives, like SMART. However, SMART incentives are also facing a decline.

Current Federal Tax Credit Breakdown:

$federal solar income tax credit 30%$

Societal Impacts of Clean Energy Policy

While rewarding the owner of the solar system, clean energy incentives like the ITC also boost the economy as a whole. This incentive amplifies society’s demand for solar power, which in turn increases the need to fill solar jobs. Solar is one of the fastest-growing job markets in the US today, creating huge economic growth. The solar industry alone accounts for nearly 250,000 jobs across the country and continues to expand with over 25 states seeing growth in 2018. The industry contributed $17 billion to the US economy in 2018 alone.

Greater solar adoption also helps make clean energy the norm and even the expectation. The ITC is so compelling to homeowners and businesses that it helps both the state and nation to meet its renewable portfolio standards (RPS) and climate goals. Since it was originally enacted in 2006, the ITC has contributed to solar industry growth of more than 10,000 -percent. These results pushed the renewal of the ITC in 2015. Incentives influence many to go solar, making it much harder to decrease our carbon footprint without them. The ITC is propelling America into an affordable, clean energy future.

Disappearing Solar Incentives

With all these benefits, the ITC may sound too good to be true, and in a way it is. This tax credit isn’t going to be around much longer. In fact, the 30-percent credit won’t exist by the end of 2019. In 2020, the ITC will drop four percent to 26-percent, and in the following year it will drop again to 22-percent. By 2022, the ITC will be gone completely for residential installations.

New Federal Tax Credit Breakdown:

$new math and savings for the federal income solar tax credit$

Over the next few years, that’s a $1,800 savings loss and after 2022, the ITC will no longer exist. As of right now, there’s nothing in place to offer savings this substantial, creating a major loss for those who wait to go solar.

Currently, lawmakers are submitting proposals to extend the ITC at its full 30-percent rate. Senators and representatives claim these proposals “create jobs, bolster the economy and address climate change.” While this initiative brings hope, there is significant uncertainty, especially with big elections looming on the horizon.

How Do State Incentives Play a Role?

If you’re considering going solar, there’s no time like the present. But, this isn’t a secret. The ITC drop is motivating homeowners to begin the solar process now, causing state incentives to dwindle.

The Solar Massachusetts Renewable Target (SMART) program is another incentive to go solar that’s exclusive to Massachusetts homeowners and businesses. However, SMART’s available incentives decrease as more people take part. Those who make use of the SMART program sooner will receive greater financial gain compared to individuals who wait. With people rushing to install before the end of ITC, SMART blocks are filling up quickly causing state incentives to dwindle. Not only should you begin your solar journey now to take advantage of the ITC, but also to beat out your neighbors for shrinking SMART incentives. These multilayered savings make solar an affordable, worthwhile investment.

Claim Your Solar Savings

Whether you’ve been planning to go solar for some time now or are just beginning to consider the idea, we highly recommend taking the leap. D irty electricity from the grid is far more expensive than producing your own energy.

To ease the decline of the incentives, we’re offering an exclusive deal to those who go solar this October. It’s not too late to maximize your savings, so reach out to begin your solar journey.

4 Observations in the ‘Solar Plus Storage’ Market

By katelyn

There’s no doubt that “energy storage” is now a common buzzword associated with solar and renewables. Just from our customers alone, storage seems top of mind. This growing curiosity has inspired us to recently explore the future of the storage industry in Massachusetts.

Energy storage, often referred to as a battery system, is essential in making your home a powerhouse. Storage systems like Tesla Powerwall 2 protect your home from power outages, allows you to store your solar energy and/or take energy from the grid when rates are the lowest, and helps create a reliable grid system. Storage protects both you and your community. As a Certified Tesla Powerwall Installer, we’ve deployed several Powerwalls to Hawaii, Massachusetts, and, now as of recently, Idaho.

Powerwall is a rechargeable battery that stores electricity during the day when solar is plentiful or when grid electricity is inexpensive and delivers clean, reliable electricity when the sun isn’t shining or during a grid outage.

Because the U.S. storage market is expected to grow 12 times the size of the 2016 market, the topic has also been of high interest to other industry experts. Kelly Pickerel, Editor in Chief of Solar Power World, asked RevoluSun for our take on how solar installers are embracing storage and its market potential. Pickerel interviewed Brian Sadler, RevoluSun’s Vice President of Business & Project Development. Afterward, we were able to reflect on our gleaned impressions of the emerging storage market and its quick evolution. Our impressions include changes to how storage is perceived, its market demand, and increased curiosity about going off the grid.

4 Impressions of the Solar + Storage Market

1. Storage is now seen as practical rather than just a luxury

Sadler explained that RevoluSun started receiving inquiries about Tesla Powerwall because it was seen as the newest toy for early adopters. Because energy storage has several practical applications, its market demographic has evolved quickly. Beyond the early adopters, most of our storage customers are drawn to both adding resiliency to their homes and engaging in a “power switch” between themselves and their utility companies.

Storage is also becoming attractive to consumers in less solar-savvy states without strong net metering policies. Net metering occurs when a solar system produces excess energy not used in the home. The excess energy is automatically sent to the grid to be used by other grid-tied homes.

Happy RevoluSun Idaho customers, Jean and Sheldon B., added storage to their home to avoid changes in Idaho solar policy. “We wanted to get through any power outages and make sure we are prepared for any changes to the Net Metering laws in Idaho. With our Tesla batteries, we can use our solar on-site and won’t be affected by future regulations. We felt it was important to be in the vanguard in solar power. This is really the future.”

Tesla Powerwall happy customers — Jean and Sheldon pictured with Powerwall in their Idaho home.

2. Local power outages spur battery demand

Tesla Powerwall protects your home or business from power outages

In the article, Sadler estimated that close to 50% of RevoluSun’s solar installations this year will include storage. More people are adding energy storage to their homes now than ever before. This will continue to rise due to intense weather-related incidents propelled by climate change, increased demand for solar, and the appeal of decreasing their dependence on their utility company or even going off the grid.

Hundreds of thousands of Massachusetts residents who depend on an outdated grid lose power every year. Energy storage enables homeowners to control their energy supply sustainably when their utility grid is down.

3. “Energy independence” is appealing to homeowners

Solar and storage allow you to be energy independent from your utility. This means that, when you pair your solar system with storage, you will not have to rely on the grid for power when solar energy is less available. Also, in times when the utility’s grid is down, your home will still have a source of power.

The term “off the grid” refers to living and powering your home without reliance on your utility for power. Off-grid homes require alternative power options like solar energy and energy storage like Powerwall.

Tesla Powerwall energy storage off the grid

I want solar and storage. Should I go off the grid?

The economics of solar make much more sense when a solar customer is still connected to their utility company. This means that you should not go off the grid if your main motivations for going solar are the financial benefits.

Technically, during a power outage, solar and non-solar customers are off the grid simply because the grid is down. However, in all other cases, the connection to a utility company enables communication between your home’s meter and the grid. In order to receive financial compensation for your energy, you must be connected to the grid. This allows your home to be a “distributed generation site,” according to Sadler. Plus, you can always use the grid as your backup, especially if you do not have energy storage.

4. Some states now incentivize energy storage

Pioneering Minds Energy storage Massachusetts

In June 2017, the Massachusetts Department of Energy Resources (DOER) announced a statewide goal of 200 megawatt-hours worth of storage by 2020. The plan, called The Energy Storage Initiative, aims to make the state a national leader in the storage market with a $10 million commitment to support Massachusetts energy storage companies and create policy to foster storage deployment.

Massachusetts is just the third state to incentivize storage. Other states with energy storage initiatives include, but are not limited to, Nevada, Maryland, California, and Oregon.

If you purchased a solar system and/or battery and you are connected to a utility company in most areas of Massachusetts, you are eligible for federal, state, and local financial incentives. These incentives include:

Federal incentive: Federal Income Tax Credit (ITC)

The Federal Income Tax Credit (ITC), also referred to as the solar investment tax credit, is one of the most important initiatives involved in the expansion of solar nationwide. The ITC is a 30% tax credit on the full cost of installing a solar and/or battery system on a residential or commercial property.

In order for your battery to be eligible for the tax credit, your storage system needs to be charged by clean energy. If you purchased solar in the past and wanted to add storage now, you would be eligible for the tax credit. Storage without a renewable energy source is not currently incentivized.

However, 2019 is the last year that homeowners can take advantage of the 30% tax credit. To be guaranteed full tax credit, it is imperative for customers to take advantage of the current federal incentive program.

State incentives: The SMART Program and tax credit

The Solar Massachusetts Renewable Target (SMART) Program is an incentive program that offers a fixed compensation rate for the energy your solar system produces so that the lifetime revenue for your solar energy will be known from the start. Additionally, SMART offers incentives for battery storage. Combined with the 30% tax credit, the incentive for solar plus storage helps pay a significant portion of the cost.

The program has a declining block structure so that as each block fills up, the incentives and capacity of each block decrease. For example, Block 1 under SMART allows solar customers to take advantage of 100-percent of the SMART incentive available and is capped at 200 megawatts worth of solar installations. However, after that block fills up, incentives and capacity of the following blocks decline. he longer you wait to go solar or add storage, the less money you save and earn.

Additionally, the state provides a personal tax credit of 15% of your total system cost, up to $1,000, when a Massachusetts resident purchases a solar system.

Local incentive: Net Metering

When a solar system overproduces energy, it sends the excess energy back to the grid through a process called net metering. Net metering allows you to generate savings on your electric bill for every excess kilowatt-hour you produce each month.

Your solar system is expected to overproduce during the summer months and underproduce during the winter months. However, this doesn’t mean that your electric bill in the winter will be high. Net metering credits roll over each month, allowing your solar energy produced in June to be used in November. Net metering works like rollover minutes on your phone bill. If you have 100 minutes each month and only use 60 minutes in March, then those unused 40 minutes will roll over in April, giving you 140 minutes to use. This enables you to pay a reduced electric bill (or none at all) even during the times when your system produces less energy.

Hear From Our Powerwall Customer

Tesla Powerwall 2 customer testimony review happy customer Massachusetts

Tom, one of our Powerwall customers, is delighted about the functionality of his new energy storage system. Powerwall stores excess solar energy produced during the day to use at night when his system isn’t producing energy. Powerwall also automatically guards Tom’s energy supply when a storm is coming. Whether the grid goes down for hours or just a few minutes, Powerwall maintains power in Tom’s home. No matter the weather or event, Powerwall will protect his home for years to come.

Get Energy Storage from RevoluSun

Powerwall is the top energy storage system on the market due to its smart features and safe design. If you are considering going solar or if you already have solar, adding energy storage is a good next step. By acting soon, you can still claim the generous state and federal incentives for installing a solar and a battery. Let us help you achieve your home energy goals by filling out this form.

5 Tips for Choosing a Solar Installer

By katelyn

Finding the right solar company for you can be a difficult task. Choosing the right installer is critical for the longevity of your solar system. You are not only choosing a company at the time of installation but also for the lifetime care of your solar system. Here are five things to look for when choosing a solar installer.

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5 Economic Benefits of Solar Energy

By katelyn

We do our best to ensure going solar fits your budget and helps you earn money along the way. You can even use some of the savings and earnings from solar incentives to pay back the money you’ve borrowed.

Apart from the obvious environmental benefits, there are countless other reasons to make the switch from fossil fuels to renewables. Here are 5 more reasons to consider solar energy for your home:

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Should You Consider Tree Removal for Solar?

By katelyn

revolusun residential solar installation roof

Most homes in the United States have the ability to go solar. You don’t need to live in Florida or California to save money and provide energy for your home. The biggest issue for going solar isn’t how sunny your state typically is. The main issues are potential obstructions to your panels, which may include trees or other buildings. Unfortunately, not much can be done if your roof is regularly shaded by another building. But if your roof is shaded by trees, there are options you can take to maximize your solar experience and savings associated with going solar.

The path most taken is to remove the trees obstructing your roof. It seems odd, however, that to “go green” you might have to remove trees to minimize your environmental footprint. While it is ironic, the environmental benefits from your solar system beat out the environmental impact of tree removal.

When considering solar panels for your home many people look around their yard and consider cutting down trees to reduce shading on their roof. Is this really necessary? It depends. Sometimes really tall trees are far enough away or situated to the north so they won’t impact the solar access. Additionally, if a house is partially shaded they can still sometimes get enough sunlight on other parts of their roof that the shaded part won’t negatively impact production and the homeowner can still produce enough power to offset energy usage. Ultimately, it is best to wait for a professional solar access report before cutting down any trees.

For every customer, RevoluSun conducts a pre-inspection to determine a home’s solar viability. Our Project Manager will then make a recommendation regarding tree work. In our experience, only about 25% of people who would benefit from tree work actually take the advice. One of our most recent customers had very poor solar access, about 74%, because of excessive shading. He cut down 22 small pines himself and hired a contractor to remove 3 large oak trees for $1,000. His solar access then went up to 81%, enough to earn a CEC rebate of $3,250 and increase his solar electricity generation by 1,290 kWh/year! The Massachusetts Clean Energy Center (CEC) is responsible for encouraging renewable energy production and, at the time this client purchased, also offered a rebate to residential solar systems producing above 81%.

The extra energy produced by this system saves an extra $300/year in avoided electricity costs, assuming the current rate of $0.23/kWh and another $330/year in SREC income. Combined with the CEC rebate, this customer saved an extra $3,880 in the first year alone. Over 25 years, this customer will save about $7,600 on avoided electricity while earning an extra $11,500 between the CEC and SRECs. That’s over $19,000!

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