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Solar Companies, Tax Credits Make It Easier to Reach for the Sun
Abe Powell’s electric bill is averaging about 54 cents a month these days. He admits he’s “conservative” with his energy use, but it’s the three-kilowatt photovoltaic power system that should take all the credit. Powell has been a believer in solar power since 1993, when he started a 10-year time frame of living off of the grid. An uncle convinced him to power his home that way, and although “it seemed like hocus-pocus at first,” solar power prompted Powell to start his own business, Solforce Systems Inc., installing solar panels.
Hedging against rate increases from the utility company is one of the benefits of solar energy, Powell said. Over the last 38 years, energy costs have increased about 5 percent, he said.
“If you use that model, the future’s not pretty,” he said.
Even in Santa Barbara, where the sun shines more than 300 days out of the year, most of us are still dependent on traditional electrical utilities to power our homes.
Tom Burt, CFO for Santa Barbara-based SunPacific Solar Electric, said because so many people have questions about solar energy, he encourages people curious about the process to get online and research. Burt said people often confuse photovoltaic, which generates electricity, with passive solar, which can be used to heat water.
So how much can one expect to pay up front for a system? There’s no “average home” in Santa Barbara, Burt said, because each house will have different power needs. Typically, however, the cost can range between $15,000 and $30,000, after rebates. And now, people can expect to recoup their costs in eight to 12 years as opposed to 20, he said.
Burt said he expects electricity to double in price in the next five to 10 years, and that having a solar energy system in place can help stabilize costs. Most modules have 20-25 year warranties, he said, but will likely last closer to 40 years.
The tax credits that are available to purchasers of photovoltaic systems can help those up-front costs be easier to stomach. At the federal level, home builders are eligible for a $2,000 tax credit for a new energy-efficient home that achieves 50 percent energy savings for heating and cooling over the 2004 International Energy Conservation Code, according to the Energy Department. A smaller credit of $1,000 is also available for new homes achieving a 30 percent energy savings for heating and cooling.
If you already live in your home, photovoltaic systems that provide electricity for the house are eligible for a tax credit of up to 30 percent of the costs on systems installed by 2016.
On top of the federal credits, an additional credit is available to California residents through the California Solar Initiative, which offers incentives based on performance factors such as installation angle, tilt and location. Owners of solar systems less than 50 kilowatts can apply for an up-front cash rebate known as the Expected Performance Based Buydown. Click here to calculate a potential rebate through the buydown program.
Burt said most solar companies handle the process from start to finish, and usually take care of the permits and installation themselves.
Vanessa McGrady, spokeswoman for Southern California Edison, said the power company was “very enthusiastic” about partnering with individuals who’d like to start powering their homes with solar. Edison, the state’s largest electric utility company, is currently the nation’s leading buyer of renewable energy. After choosing a company to install the solar power system, applications will be filed from the solar company or the homeowner to SCE for incentives and requesting permission to connect to the grid.
“We help people understand what the process is” by offering classes to homeowners interested in solar, McGrady said, one of which will be coming to Goleta on April 8. Click here for more information of the class.
If a household is not off the grid completely, it can expect monthly statements outlining how much is owed or will be paid, in a process called “net-metering.” The customer then settles up at the end of the year, McGrady said.
And what about the permits involved in a home project for solar?
The majority of solar projects qualify for over-the-counter permits, said Jaime Limon, senior planner and supervisor of design review and historic preservation for the city of Santa Barbara. That type of permit isn’t enough if there are addition renovations being done that require design review or if the project will be placed on a building that is in a historical district or on a hillside. Santa Barbara has strict guidelines for these types of projects, he said. “We don’t believe you can just waive design review,” he said.
Because state legislation says “that local agencies not adopt ordinances that create unreasonable barriers to the installation of solar energy systems including ... design review for aesthetic purposes,” some communities have interpreted that to mean “no obstacles,” Limon said. Santa Barbara, however, maintains that the state’s solar rights laws do not exempt solar energy systems from city zoning ordinances.
Limon has seen an increase in applications for solar energy system permits in the past several years, and Santa Barbara has issued a a booklet of solar guidelines to get people familiar with what the city’s standards are.
“We encourage people to have a balance between energy conservation and aesthetics,” said Limon, who added that the city now gives out annual awards for neighborhood-compatible photovoltaic projects as well as passive solar building design.
“It’s a challenge sometimes,” he said. “Often, the location of the panels happens to be on the most visible parts of the home.”
Limon encourages would-be solar applicants to take a look at the guidelines and the examples of what has been successful in the past.
— Noozhawk staff writer Lara Cooper can be reached at .(JavaScript must be enabled to view this email address).
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» on 03.30.09 @ 05:39 AM
Now we just need to put some of our countries unemployed to work making pannels. Supply the demand and the prices will come down further.
» on 03.30.09 @ 06:42 AM
I wonder if all the chicken little greenies who imagine a future without oil have also imagined a landscape covered in solar panels and windmills? Because to get the same output as “dirty” sources, that is what it is going to require - every available piece of land will have to be dedicated to energy production (instead of food production for example). Be sure to consider the adverse environmental impacts. Deforestation for one, less agricultural land for food production. I wonder how much heat will be reflected back into the atmosphere by these panels, instead of being absorbed by plants which will accelerate global warming? Factor in the cost of real estate in the cost savings and you will soon see how impractical the whole idealistic vision is. Plus the aesthetics - imagine our mountainsides tiled with panels and our valleys filled with wind turbines…more and more and more as the population grows…
» on 03.30.09 @ 06:48 AM
While I appreciate that the City of SB is concerned about preserving historical landmarks, I challenge them to define ‘aesthetics’ in regards to solar panels on hillsides and rooftops. The quote from Jaime, “We encourage people to have a balance between energy conservation and aesthetics,” indicates that our City is far behind the alternative energy curve. It’s surprising that a City who supports The 2030 Challenge (aka zero net energy buildings by 2030) and claims to be working toward carbon neutrality would place energy conservation and aesthetics on two opposite ends of a spectrum. Who is the City of SB to say that solar panels aren’t aesthetically pleasing and that already-developed hillsides and visible rooftops aren’t prime locations for increasing energy efficiency? Perhaps Jaime would prefer to make judgments on homeowners who wish to place miniature oil derricks their backyards?
At this point, when our earth is approaching peak oil and irreversible climate change, placing energy conservation and aesthetics on opposite poles is exactly the wrong thing to do. Get your priorities straight City of SB! Provide incentives for ALL homeowners with proper sun exposure to place solar panels on their roofs. At the very least, don’t ask them to find “a balance between energy conservation and [YOUR DEFINITION OF] aesthetics.” Take a clue from our federal and state governments and start helping your community become energy independent, one rooftop at a time.
» on 03.30.09 @ 08:24 AM
Solar is a bad investment.
The energy produced is so small, and the cost so high, that it takes 30 years to pay for the cost of the installation. One must take the interest into account, as well as the value of money if it had been invested elsewhere.
But the dirty little secret in the solar industry is that the panels only last for 30 years and then stop producing electricity right about the time that the energy savings pays foe the cost of installation.
And remember a subsidy is not free money but has to be paid for by the taxpayers.
» on 03.30.09 @ 02:31 PM
I work for a Solar Company and prices are dropping…Efficiencies are up and cost is down. Money is finally being invested into the methods of manufacturing and expanding on the old technology of Solar. FYI .4% of the land in the US is enough to supply the electricity for the whole country. Not feasible but food for thought. Also cells have anti-reflective coatings so they absorb heat not reflect back into the atmosphere.
» on 03.30.09 @ 03:11 PM
Because it shows the beauty of the mountainside that will eventually be tiled over with solar panels…
» on 03.30.09 @ 03:14 PM
Yeah great idea, your own sustainable energy source ... that is if you can afford it. I can’t, and I will be less able when my taxes go up to make up for giving credits to those who can!
» on 03.30.09 @ 06:31 PM
Ok N8ball and that .4% (Where do you get that figure? As any good math teacher would say - show your work or state your sources) has to be concentrated near civilized areas to minimize transmission loss - so it will be concentrated in the areas that we live in and see. And who is going to wash the dirt off of these things? How much water will be wasted? Or will it be Windex?
» on 03.30.09 @ 06:33 PM
And how well are they going to work where the sun don’t shine, like say , Seattle? You must have these answers since you work for a “Solar Company”. Hey I’m just askin.
» on 03.30.09 @ 10:28 PM
Thermal Solar will preheat for your water htr and if the area is large enuf it will help heat your house. In the 1970s I built one collector 6 X25 ft- 150 sq ft which heated 275 gal tank. Measured it’s output one year..worst months here that yr Jan & Feb averaged 2 hrs a day the pump was on. Later I put used water heat panels 200 sq ft on my business building heating about 500 gal storage which preheated water before it went into water htr and often was all needed to heat the area I chose. Any temp above 50dF preheats for wtr htr..Above 80 or 90 heats space,,This system often started day a 100 and ended at 130 (30KWH) and during summer maxed out at 175. You live with this and be sceptical>Moved stored those panels. At new site set up comparison test homemade & factory panel. Left working after test to heat office, 100 gal heated from 95 to 130 today.
» on 03.31.09 @ 06:03 AM
Source is NREL(National Renewable energy Laboratory) Heard of them? As for Sunlight. Germany is the leader in Solar Energy use right now and they get less sun each year than Washington State. Of course it is ideal in places like the southwest but it works just fine in countries that get less than the US.
Solar is not where it needs to be yet. Costs are still too high but they will go down as the market floods. Efficiencies will go up as investment is used. I don’t want panels all over mountains or hillsides but what is the problem using wasted rooftop space.
» on 03.31.09 @ 06:07 AM
Solar Maps:
http://www.solar4power.com/solar-power-global-maps.html
We shouldn’t fall behind any country when it comes to using any technology. Solar is just a small part of the puzzle.
» on 03.31.09 @ 08:35 AM
I also believe that solar homes are a great investment. I have dedicated http://www.sunsohot.com to showing people how simple solar energy can be.
» on 04.01.09 @ 02:32 AM
The way I see it - Solar will add enough energy to the grid to maybe cover the increased influx of immigration population growth and nothing more. So there is zero gain.
» on 04.04.09 @ 10:04 AM
Solar power is a good investment. The previous poster has bad information. Solar panels carry warranties for 20 to 25 years, depending on the manufacturer. This technology has been around for 40 years, and studies show that today’s panels will retain 90% of their efficiency after 20 years.
Further, the cost of installing solar has come down substantially. Combine this with federal and state incentives, and costs have never been lower or more affordable. The typical payback ranges from 4 - 10 years, depending on your power needs. Plus the home value will appreciate by installing solar panels. Let’s not forget that electricity rates increase an average 2.7% annually according to the DOE. So the cost of traditional utility energy continues to go up, while the cost of clean solar energy goes down. Finally, you’ll pollute less and your kids and grandkids will think you are finally doing something cool!
Homeowners can use web sites like http://www.freecleansolar.com to learn more about solar power, rebates and find quality, local professionals who can give you the facts.
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