How Solar Program Works

Solar energy is an economical, renewable, and clean source of energy. The electricity produced in excess is stored in the battery or supplied to the electricity grid. Solar Panel is a one-time investment that helps you save money on changing electricity tariffs. An investment in solar panels system is an investment in a bright future. At the same time, investing in a solar panels system requires market research and understanding. Before opting for a plan, you should conduct a comprehensive home energy audit followed by an analysis of the solar potential, which will give you an insight into your energy needs. Solar energy incentives provided at National, State, and local levels encourage US citizens for adopting renewable energy resources. Such as Federal Solar Tax credit provides the consumer with the opportunity to deduct up to 20% from annual tax on going solar. While the power purchase agreement plays most significant role for qualifying for local incentives and rebates.

Federal solar tax credit

Federal Solar Tax Credit

The investment tax credit (ITC) is alternatively known as the federal solar tax credit. It applies to both commercial and residential Solar Panel systems. Moreover, there is no limit to its value. During 2020, ITC allows the user to deduct 26% of the installation cost from the federal taxes. In 2021 it will enable the new residential and commercial solar user to deduct 22%, further decreasing to 10% on commercial installation in 2022.
Additionally, there will be no tax on the residential installation. The federal solar tax credit was established by the Energy Policy Act 2005. The owner is eligible for the tax relaxation as long as he/she owns the solar energy system. On the other hand, if you sign a lease with the solar system installers, you may not directly own the system and not qualify for the federal solar tax credit relaxation. Green Solar Energy brings you in direct contact with local solar suppliers. 

Solar Leasing

There are different types of solar power purchase agreements offered by the solar leasing companies. The lease agreement provides flexibility in case there is a change in circumstances. Residential lease spans between 20 to 25 years according to various needs and demands. On the other hand, the commercial lease ranges from 7 to 20 years. The leasing company monitors the solar panels system performance during the lease duration to ensure it is operating as desired. They are also responsible for repairs and maintenance of your solar panels. The user can keep track of the system through free online, tablet, or smartphone applications. The user can buy the solar panels system anytime at the pre-defined price stated in the contract or fair market value, whichever is higher. If the user plans to sell the property, the lease is transferrable as well. At the end of the agreement, the user can either renew the lease agreement or request the company to remove the solar energy system. There are different levels of solar leasing including the following.

Which Solar Program is Best for You

Power Purchase Agreement

Solar Power Purchase Agreement (PPA)

A solar power purchase agreement (PPA) is an agreement between the supplier/installer or leasing company and consumer, where the supplier/installer is responsible for designing, permitting, installing, and financing solar panels system. The solar energy is sold to the customer at a fixed rate, lower than the grid. Power Purchase Agreement ranges from 10 to 25 years. The installer or the leasing company is responsible for repairs and maintenance. At the end of the PPA, the user can either buy the system or requests the supplier/installer to remove the solar energy system. It does not have any upfront cost thus reduces energy costs. There are no system or operation risks. PPA offers better leverage of tax credit provisions and is particularly beneficial if the property value changes. The Green Solar Energy helps you in attaining best power purchase agreement.

Feed-in Tariff

A feed-in tariff (FIT) aims to promote green energy, resource preservation, and support sustainable future endeavors. It guarantees a specific preset rate for the electricity supplied to the producers and homeowners. The agreement ranges from 15 to 20 years. It is beneficial for the homeowner because if the feed-in tariff exceeds the retail kWh rate, the company will pay the user every year.

Solar program
rebate solar

Solar Rebate Program

Solar energy is critical for positive environmental impacts and contributes to a sustainable future. To encourage solar energy production and consumption, the government offers various financial incentives and tax breaks. These facilities aim to ensure the continued expansion of solar. Moreover, it makes the solar energy system more accessible to homeowners. Different states aim to promote renewable energy and offer incentives such as Cash Rebates, Investment Tax Credits (ITC), State Tax Credits, Solar Renewable Energy Certificates (SRECs), and Performance-Based Incentives (PBIs). The solar rebate programs are for a limited time. It can help in reducing the system cost by 10 to 20%.

The Net Metering Program

Net metering is a billing system that allows the user to monitor and keep a record of the solar energy used and add to the grid. If the home is net-metered, the user keeps track of the electricity consumed from the grid during the night. Alternatively, when the energy produced exceeds the user’s needs, it is supplied to the grid. The user only billed for the net energy used. Approximately 20-40% of the energy produced goes to the grid.

Solar net metering

    See if your home qualifies for the latest incentives on SOLAR program

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