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Solar incentives
Leverage limited-time Solar incentives to maximize your investment, lower your upfront costs, boost ROI, and even generate revenue.
There are numerous federal, state, and local incentives that are designed to make going solar even more affordable than it already is. Our team helps businesses navigate these generous incentives to further maximize their solar investment.
Some incentives, like the Business Energy Investment Tax Credit (ITC), lower the cost of going solar.
An introduction to the ITC
The ITC is one of the most lucrative ways to reduce the investment costs of your solar installation.
What is the ITC?
The ITC is a federal tax credit that has made solar an affordable renewable energy option by granting a dollar-for-dollar reduction in the tax liability that a business claiming the credit would otherwise pay the federal government.
Why is the ITC important?
The ITC reduces the upfront costs of investing in solar, allowing businesses to enjoy a shorter payback period and boost ROI. It has proven to be one of the most important federal incentives directly responsible for the growth of solar energy adoption in the U.S.
How do you claim the ITC?
You claim the credit by filing IRS Tax Form 3468 when you file your yearly federal tax return. If you don’t have enough tax liability to claim the entire credit in one year, you can roll over the remaining credits back one year or into future years.
How much can you save with the ITC?
To secure best level of this incentive, you need to begin construction of your solar PV system in 2020. The ITC will remain at 26% of all solar PV system expenditures until the end of 2020, but it will begin to ramp down, eventually landing at 10%.
Other incentives can transform Solar into an additional revenue stream for your business.
The net metering program
During the day, many Solar customers produce more electricity than they can consume in a day. This excess energy can be stored in an onsite battery for later use or fed back into the grid to reduce future utility bills.
Net metering is an incentive available in many states, allowing businesses to monetize their solar energy by feeding solar electricity they do not use onsite back into the grid. With this incentive, you are credited for the solar electricity you add to the grid – lowering your future utility bills and therefore your business’s operating expenses.
The solar feed-in tariff (FiT)
A FiT financially compensates you for the clean power that your solar PV panels generate, monetizing your solar energy. You sell 100% of your generated solar energy to the grid at a higher rate that is typically fixed for 20 years. You then purchase your power directly from your utility via your regular bill.
With the feed-in tariff, you are getting paid at a higher rate for your generated solar power, so your solar PV system is in essence covering the cost of the electricity you consume from your utility company plus the additional premium the utility is paying you for that power.
Solar Renewable Energy Certificates
When your solar PV panels generate electricity, they also produce Solar Renewable Energy Certificates (SRECs). These credits represent the environmental benefits associated with producing 1 MWh (or 1,000 kWh) of solar electricity. You can sell your credits back to utility companies in an open market and generate an additional revenue stream from going solar, further maximizing your investment.
Centrica Business Solutions can help you navigate the available SREC program in your state and offer you the best value for the SRECs generated by your solar PV system. We have various offerings that help you maximize your earnings and allow you to choose the timing of your earnings.
Our team can walk you through available options and help you navigate these opportunities for your business.
Learn how to leverage available solar incentives to maximize and monetize your Solar PV system. Read our 3-part series that provides information on time-critical Solar incentive programs.
