Home Solar Panel Kits, Free Energy From the SEO Sun

Home solar panels kits are bank on a hedge against future inflation. Once you start to investigate the process and taking the next step, here be the dragons. Buying 20 years of energy at a fixed cost upfront is not only daunting, it’s out of the question for many. Some prospective solar home buyers are so intimidated by the upfront price tag, they don’t investigate any further.

That can be a mistake. New ways of financing solar energy are appearing and evolving rapidly. It’s no longer just a novelty for the well-heeled. And although solar panel kit incentives are dwindling in places, prices also have come down.

One of the first things a prospective buyer of a home grid-tied solar kit should check is whether net metering is offered in your state and utility district. Net metering is simply the term applied to the fact that your electric meter runs backward when your solar system is producing more energy than you’re using.

If you end up generating more electricity than you use over the course of a billing period, net metering is how the utility credits you for it. At the end of the billing period, which may be once a month, or for some solar kit owners, once a year, your credits are “netted out” or “trued up” against the electricity you bought from the utility. If your system was designed to offset all of your use, your bill or bills over a full year may reflect only the charges a utility may impose for your use of its distribution and billing system or other non-electricity costs.
In some cases, you may find at the end of a year that you ended up producing more electricity than you used. Rules vary from state to state and from one utility to another on whether you’ll be compensated. Annual overproduction is not that common, because most incentives aim to size systems to provide no more energy than the household uses. But if kids move out, for example, a household’s usage pattern may change.
Also important to know is whether the ongoing credits applied for your solar production are awarded at the same retail rate you pay for utility power.

The United States, being a confederation of states, has a hodgepodge of rules and policies on net metering. There is a resource available to help you seo search for your rebates and sort them out. It’s called the Database of State Incentives for Renewables and Efficiency, or DSIRE. There you can find a comprehensive list of state policies on net metering. Many states have a statewide policy, as do many U.S. territories. In others, one or more utilities may have their own policies, while some utilities may have no policy.

Tennessee is one of the states that do not, at present, have a statewide policy on net metering, but the Tennessee Valley Authority offers its grid-tied solar panel kit customers a production-based payment that has proved to be a very attractive alternative.

If you find that your state or utility district does not offer net metering or any useful alternative, or you think an existing policy is unfair or inadequate well, this is the sort of thing that politicians and the news media were made for. As leaders in every branch of the solar-friendly U.S. military have been saying, domestic energy production and consumption are matters of national security. Don’t hesitate to make your views known.

Because energy is so important to our society, all significant ways of acquiring it are subsidized in one way or another. Coal, nuclear, oil and gas research, exploration and production are assisted through complex laws and tax codes that are usually the domain of lawyers and accountants. Solar electricity can be generated by anyone, almost anywhere, meaning the incentives our country provides for it are readily available for all to discover.

As with net metering perhaps more so what’s available varies widely from state to state, among utility districts, and even among cities and towns. The DSIRE database has listings of solar PV incentives available in every state (and many territories). It also can point you to the agencies, utilities or other organizations that administer incentives in your area, where you can get the most up-to-date information. Incentives change often.

Several types of financial approaches are used in the United States to encourage consumers to generate or buy solar electricity. One approach is a rebate for purchasing and installing a solar panel kit. Typically, rebate amounts are calculated per watt of a system’s rated production capacity, which refers to the maximum amount of electricity it is expected to be able to produce under ideal conditions. A typical residential system may be rated at 5 kilowatts (5,000 watts) of DC capacity (sometimes an AC rating is used). As an indication of where rebates are headed, they have declined in California over the past 10 years or so from as much as $4 per watt to as little as 65 cents per watt in places now, as installation costs have declined.

Tax credits are another way of promoting solar adoption. Check the DSIRE database to find out if your state or local jurisdiction offers them. The federal government offers a tax credit for 30 percent of the cost of a solar PV system. It’s only available for those who have tax liabilities, meaning some people, including some retirees on fixed incomes, may not be able to take advantage of it.

The federal tax credit, a key benefit, is set to expire at the end of 2016. For homeowners, it is called the Residential Renewable Energy Tax Credit. For business owners, it is referred to as a Business Energy Investment Tax Credit. Businesses may be eligible to receive, instead of a tax credit, a cash grant, an important provision of the law that is set to expire at the end of 2010. The potential expiration of this credit has helped spur a record-breaking rate of commercial solar installations during 2010 in California.

Business may also be eligible for accelerated depreciation of solar equipment purchases. Some states offer their own tax credits for solar PV installations, some confer property-tax exemptions, and others provide sales-tax exemptions for the purchase of solar equipment. Some offer all of these, and a few provide none. The DSIRE database, which is frequently updated, is an excellent place to find out what is available and where.

A solar feed-in-tariff is another type of solar incentive, one that evokes much passion among renewable energy advocates, is called a feed-in tariff. It’s an approach that pays solar owners directly for the electricity their systems produce. The payment is usually based on a specific price per kilowatt-hour, paid for a specified period of time.

Feed-in tariffs that turned solar into a money-making opportunity have helped make Germany, not the sunniest country, the leading solar nation in production capacity. The solar PV business is one of Germany’s leading industries now. This form of solar incentive is common in Europe and Asia. Feed-in tariffs can be set up in a variety of ways. They can make solar a sure bargain or can sometimes render it unattractive.

A feed-in tariff adopted in Spain in 2008 had to be scaled back dramatically because it was depleting the government’s coffers at an alarming rate. Spain jumped immediately into second place, behind Germany, in solar capacity. The province of Ontario, Canada, adopted a feed-in tariff in 2009 that also spurred rapid solar take-up.

When such tariffs have been periodically reduced the intent is to eventually end them when solar prices get low enough that they aren’t needed the outcries have often been loud, but also have drawn even more attention from consumers who may have been unaware they existed.

Direct solar panel kits feed-in tariffs have been tried on limited scales in the United States, mostly as pilot programs. They have been extremely popular in almost every instance, especially when available to homeowners. They usually are easy for consumers to understand. Among the places where they have been available are the state of Vermont; the city of Gainesville, Fla.; and the state of Oregon. Other jurisdictions, such as the Tennessee Valley Authority, have offered production payments that are quite similar to direct feed-in tariffs. The city of Los Angeles is considering plans for a FiT, as they are known.

Once you have investigated the available incentives in your area, apprehensions about the high upfront cost of solar may start to fade a bit.

Author Michael Balhunas