Federal and State Incentives

Federal and State incentives are making solar and other renewable sources of energy very competitive with utility generated electricity. Below we explore these in more detail.

Financing Options

Federal Incentives

The federal government's 30% Investment Tax Credit for solar and other qualified renewable energy systems is active until 2016. Both residential and commercial photovoltaic systems are eligible for a dollar-for-dollar reduction of their owed taxes at 30% of the solar system installation cost. There are no cap limits. What this means is if your installation cost is $40,000 then it’s eligible for a $12,000 federal tax credit.

Business owners can use a Treasury Grant in lieu of the 30% tax credit until the end of 2011. Simply stated, businesses that install solar will receive 30% of the installation price within two months of system completion - regardless of tax liability. There are efforts to extend this into 2012. In addition, businesses can also take accelerated depreciation on the equipment purchased and 100% of that may be taken in the first year for 2011. Accelerated depreciation will drop to 50% for 2012.


For more details and the latest listing of Federal and State incentives for residential and business investors please visit the DSIRE website (Database of State Incentives for Renewables and Efficiency). This is, by far, the most up-to-date listing of incentives on the web. The DSIRE website also explains the incentives and their conditions. Whatever they don't answer, they provide an appropriate link to other sites that have specific information for your state.


If you want to learn more in general about renewable energy and solar photovoltaic, please explore the federal organization links below. There is a wealth of information waiting for you to discover.

Links to Federal Renewable Energy Organizations

U.S. Department of Energy

 


 

State Incentives

A complete, up-to-date list of all states is found in the DSIRE website. Click on the buttons below to see the cost calculations and cash flow for either a residential or commercial installation in the state of Pennsylvania.

Commercial Example

 

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