Solar Panel - Better tax rebate incentive for 2009

[geek]

I heard that the new legislation passed with the bailout includes the elimination of the current $2k cap for residential installs, so homeowners will qualify for 30% tax rebate like it is applied to business.

Anyone has any detail info on this and how this would affect (decrease or stay the same) the state rebate incentive?

Here in CT the state rebate is $5 per watt up to 5KW system ($25,000 dollars)

I have a solar system installation coming for electric needs that I will hold off until January if this is true.........
thanks.........

 

[daveswoodhauler]

Havent heard about the new legislation, but this board might be able to help find an answer:

http://www.wind-sun.com/ForumVB/

good luck

 

[jdemaris]

I heard that the new legislation passed with the bailout includes the elimination of the current $2k cap for residential installs, so homeowners will qualify for 30% tax rebate like it is applied to business.

Anyone has any detail info on this and how this would affect (decrease or stay the same) the state rebate incentive?

Here in CT the state rebate is $5 per watt up to 5KW system ($25,000 dollars)

I have a solar system installation coming for electric needs that I will hold off until January if this is true.........
thanks.........

I can't say I know much about the new Federal incentive - but I can tell you this. Often, state incentives are meaningless and useless - unless you are very lucky and very careful.
I've got plenty of experience as a builder, mechanic, and an electrician. But, regardless of my skills - the state of New York (and many others) require you to use a state-solar-certified installer to qualify for state incentives. It boils down to a "make work" program and many state-certified installers are NOT highly qualified or skilled. Many will eat up your incentive money and there is no net-gain compared to a self-install with no state incentives. So, it can work out OK for somebody with no skills - and be a total rip-off for someone that can do much of the work him/herself.

In my situation, I had a small off-grid setup. But, I wanted to cash in on state and Fed. incentives and go grid-tie. So, my plan was - to move my off-grid equipment to some remote property I have in the New York Adirondack mountains. Then, at home - get a 5000 - 6000 watt grid-tie system with battery backup and get much paid for by incentives. Well - what a joke!. State incentives require use of a state-certified installer. So, here I am a licensed electrician - yet I'm forced to let some bozos come here with no license, and few skills. I had half a dozen companies come here and give me estimates. Most were billing the job at $200 plus per hour plus a 20% mark-up on materials. Also, when you want to qualify for state incentives - you are forced to use grid-tie and forced to use many high-end and overpriced materials you would not have to use otherwise. So, it's very easy to lose money when trying to gain with incentives.

If I had used off-grid with no incentives - I could of used blemished and fully warranteed solar panels at half cost, a mod-wave inverter at half cost, etc. I finally got a bit lucky and found two new guys just starting out and just recenlty state certified. They agreed to do the work at half the rate other places had quoted me, let me buy my own materials with no mark-up, and also - I did half the work myself. More-or-less I became a sub-contractor for them on my own property. I also designed the system myself becasue I wanted a substantial battery backup system along with grid-tie. When we got all done, it failed electrical inspection twice - due to some really stupid mistakes made by the certified installers - which I had to fix.

I will also add - that of all the places that came here to give me an estimate, they all argued that my proposed 5400 watt system was too big. The biggest any would install was 3200 watts. I disagreed. We live in a low-light area of NY and no charts will tell you that. Well, I convinced the new installers and also the State incentive people. Put in my 5400 watt system with enough battery backup tp run my house for five days with no sunlight. Just got through my first calender year - and made 5% more electricity than we used - which is just right. I was correct - and the majority of the certified incentive bozos that came here were wrong.

Good luck -and if I sound bitter, I am. It ticks me off to see tax dollars thown away like this. Some states allow "self install" which makes much more sense. It all has to get inspected anyway.

 

[geek]

thanks much for your feedback.

One question, you mentioned you have a grid-tied system but also with battery backups.

Here in CT to get the state rebate it cannot be a system with battery, meaning it has to be a grid-tied system.

Could you ellaborate a bit on the batteries, is that something you added after the system was installed?

 

[jdemaris]

thanks much for your feedback.

One question, you mentioned you have a grid-tied system but also with battery backups.

Here in CT to get the state rebate it cannot be a system with battery, meaning it has to be a grid-tied system.

Could you ellaborate a bit on the batteries, is that something you added after the system was installed?

Check your fine print for CT incentives. As far as I know, you certainly ARE allowed to have a battery backup system as long as your system is grid-tied. You just can't have battery only without grid-tie. When I did mine, it was considered an anomalie. Now, they are becoming more common and mainstream. Think about it. To go through all the work and expense - and then -when the grid is down have no power?? Makes no sense to me.

The only big differnce is - you have a battery bank attached to your grid tie system. And certain inverter systems are already designed for it - e.g. Outback, Beacon, and Sunny Boy. I think maybe Trace has one now too. Usually the automatic change-over when the grid is down - and sun not shining - is a limited backup. Often hooked just to bare essentials like heat, fridge, and/or water pump. But, you also add a manual switch that allows full use of the battery bank and adds more circuits when tripped.

Power was out here last week for a day and a half. I woke up and only had the fridge and water pump. Went down the cellar, tripped the change-over switch and then had the whole house powered.

Big expense is the battery bank - and size is totally up to you and how much reserve you want. Funny thing is - even though the incentive people -and most installers were clueless on the issue - the State incentive program demands that any batteries used must have a 5 year warranty.
That limits choices a lot - since just about no company sells a battery for solar-storage with a five year warranty except Rolls/Surette. So, that's what I got. Next time I need batteries - if I live long enough - I can buy anything I want.

Many companies now are changing all their warranties to comply with State incentive demands. Outback used to give only a 2 year warranty on their inverters and controllers and lost sales since they did not quality for most incentive programs. So, now - just about all companies are being forced to make warranties longer.

 

[geek]

good info, thanks for sharing. My system is being installed in about a month from now, maybe less, but we will interconnect in Jan.09 to qualify for the new tax incentive.

The state rebate is actually guaarantee and handled by the company installing my system (Akeena), CT already approved the rebate.

My system will be a 5.5kw system with a Sunny Boy 5000US 240w inverter.
Down the road I may be looking for battery backup but not for the whole house, mainly for heat purposes and my new pellet stove, hopefully just a couple batteries will be good enough.

If I get the batteries down the road, and as you mentioned the sunny boy inverters have the hookups for battery backups, is the installation easy for a homeowner with no much electric skills or I need to hire a licensed electrician, how complicated it gets at that point?

This would be the last question for now, and again thanks for the good info.

.

 

[jdemaris]

The state rebate is actually guaarantee and handled by the company installing my system (Akeena), CT already approved the rebate.

That's the way it's done here in New York too. The installer has to give a five year warranty, and the incentive check is sent to the installer by the state - and then he pays the customer.
Then, the state walks away from the whole deal. If the installer goes bankrupt, and doesn't honor the warranty - the state does nothing although they forced the customer to use the installer.

In regard to adding battery backup later - I'm not sure without reading all the literature on the system you're buying. I'm sure if you go to the Sunnyboy website - it will tell you somewhere.
All the state incentive programs that I know of - pay per the kilowatt of solar array. Makes no difference to them if you install battery backup or not - as long as you're grid-tied and the installer warranties the entire system. Federal will allow the battery backup stuff for an exemption. The major difference in grid-tie, and grid-tie with battery backup is this. Standard gridtie just has a couple of big inverters - or one big inverter and a 120 to 240 transformer. A gridtie system with battery backup must have inverters that can be programed to work in battery backup mode, and also - a battery bank must be added - and controller/chargers that - when needed - take power from the solar panels and regulate that power to charge the batteries in DC. So, the big added expense is the battery bank and the controller/chargers. I have two Outback MX60s - they are about the most popluar in the world right now. I suspect Sunnyboy has their own, but I haven't checked lately. Stuff changes all the time, and I only study it when I'm building something. One other thing about battery backup that may have changed recently - I'm not sure. Most inverters used for battery backup can't use a solar array volage of more than 75-80 volts. That can be a problem if you need to mount your solar panels a long distance from your house and very high voltage is needed to prevent voltage drop from long wire runs. Some arrays are installed at 400 volts. With my system, I DID have a distance problem since my house in built into the side of mountain and does not get full sun. I had to mount the solar panels 500 feet away. And, I couldn't use more than a 48 volt array. So, I sort of killed two birds with one stone. I needed more farm storage space anyway. So, I built a new barn with one roof built special for the solar panels - with the preferred angle and due-south facing. I then installed the solar array, inverters, and battery bank in the barn - not at the house. Power comes from the barn to the house as 240 VAC instead of DC. Works fine.

 

[jdemaris]

My system will be a 5.5kw system with a Sunny Boy 5000US 240w inverter.
Down the road I may be looking for battery backup but not for the whole house, mainly for heat .

One thing I forgot to ask you. In your state, will you get paid back by the power company for any excess electricity you make in a calendar year? In New York, we do get paid. But, in many states you don't. All excess power is a gift to the power company and you get nothing. Michigan is one such state.

 

[jdemaris]

My system will be a 5.5kw system with a Sunny Boy 5000US 240w inverter.
Down the road I may be looking for battery backup but not for the whole house, mainly for heat purposes and my new pellet stove, hopefully just a couple batteries will be good enough.

.

I'm wondering what your montly electric useage is? I got mine down to 300 KWh per month before going to solar. And, my 5250 watt system make 5-10% more power per year then I use. I doubt you're going to do much better, but perhaps youve got a little more sun if you're close to the coast. My point is - if your montly useage tends to be 500 or 600 KWh, then your system is likely to be too small if you wish to make all your power.

I got looking in my inverter database. You'd never be able to hook that Sunnyboy inverter to a battery backup system. It requires way too much voltage and needs a DC solar array voltage of at least 300 volts. The specs on it are similar to a Fronius inverter that several installers tried to sell me and I'm glad I refused.

Battery backup isn't even the main issue. If all you wanted was a battery backup, you could just keep a battery bank around hooked to an AC charger. Then, run it through a cheap inverter to run your house in an emergency. You can buy a rugged and cheap modified wave inverter - 4000 watts for less than $200.

To me, the big issue is - with a system like you're installing - if the grid is down - so is your entire system. The power could be out for a week and the sun shining brightly - and you're screwed. All those panels sitting there doing nothing. That because conventional grid-tie solar systems are engineered to shut down when the grid is out. Does that make sense to you? With a battery backup type system, it CAN be made to work with the grid down - from the batteries or direct from the solar panels. Note that with some grid-tie inverters, there are ways to bypass the system and force them to work - but I doubt your installer will tell you how.

As far as I'm concerned, there are only two reasons to install a high-voltage input inverter like you're getting. To eliminate problems with a very long wire run - or - just laziness and ease of installation. With a high-voltage inverter, many of the panels can simply be hooked together in series - instead of parallel. Also keep in mind that most installers don't "think out of the box" , they just install pre-designed kits.

If you ever want the ability to incorporate battery back-up. or "legal" ability to use your solar panels with the grid down, you need an inverter than can run with a 12, 24, 48, or 60 volt DC input. Whatever the input is set at, that's what the battery bank voltage must be, and that's what the controller/charger must be set at for battery charging. With a 300 volt input inverter like you're getting - first - it would be pretty hard to have a 300 volt battery bank to match. It would take fifty 6 volt batteries. And, you'd never find a charger/controller capable of charging at a 300 volt rate. The highest on the market that I know of is 48 volts.

I'm curious what your system is costing you? Mine - with 5400 watts in panels, dual 3000 watt Outback inverters, dual Outback MX60 controller/chargers, and a six Rolls/Surette batteries, etc. cost $41,700. I got back $21,000 from the State incentive, $2000 from the Federal government, and $5000 back from the State government. So, my out-of-pocket expense was $13,700.

Basic equipment is:

30 Kyocera KC175GT Panels
Outback 3048-2 power panel
MX-60 Charge Controllers, breakers and disconnects
8 Surette S-460 Batteries
Unirac Aluminum racking with stainless steel mounting hardware

 

[geek]

Originally I was getting a 36 panel system at 170w per panel, my local town (according to the installer company) was saying "No" because the layout would have a little overhang on the top (for which I didn't care).
So then Akeena proposed a smaller system with 30 panels at 175w each:

30 Andalay ST175-1
1 SMA SB5000US (240V)

Contract Price $39,143.76
Less Refundable Audit Fee $0.00
CT state Rebate -$22,007.00
Price Net of Rebate $17,136.76
State Solar Tax Credit $0.00
Federal Solar Tax Credit (residential) -$2,000.00
30% Federal Tax Credit (business) $0.00
Net Price $15,136.76
Estimated REC Revenue (10yr)
Depreciation Tax Benefit (MACRS) $0
Increase in Appraised Value $21,261
Peak Power Output (DC watts) 5,250
Annual Energy Output (kwh/yr) 5,595
Insolation Availability %, Annual 100%
Roof Compass Direction (degrees true) 214
Roof Pitch (degrees) 25
Design Factor (orientation, pitch, shading) 91%
Estimated Average Power Output (WAC per WDC) 0.655
Daily Avg Insolation (hrs/day this location) 4.4

 

[geek]

More excerpt from the final contract:

The system will produce approximately 5,595 kWh annually.
Akeena warrants the System and its work herein according to the terms and conditions of the attached Warranty Form. See below for manufacturer warranties on modules and inverters.

a. Installation Site: Your PV modules will be installed over the south facing roof of your house. Wiring from the panels to the inverter will be run in conduit to the inverter location.

b. Electrical: DC power from the solar modules will be routed in electrical conduit to the inverter. AC power from the inverters will be routed to your main electrical service entrance. A splice kit and load center will be installed to permit the addition of a breaker for each inverter connected to your home electrical system. Conduit will be run on the outside of the roof and walls, and will be painted to match the underlying surface if possible. According to the National Electric Code, wires carrying DC power from the modules to the inverter should not be run within interior walls or attic spaces.

c. PV Modules: 30 Andalay ST175-1 Integrated Solar Power System modules will be installed. These modules are covered by a 25-year manufacturer warranty.

d. Inverters: 1 SMA SB5000US (240V) inverter will be installed. Your inverter(s) will be installed on the outside of your house, near your existing electrical meter. A kWh meter will be included with the system so that you can determine your net energy production. This state-of-the-art inverter carries a 10-year manufacturer warranty.

e. Mounting: PV modules will be installed with secure, pre-engineered mounting systems using all stainless steel and aluminum hardware for long-term durability. For your composition roof, PV modules will be attached to flashed standoffs. These standoffs will be securely fastened to the underlying rafters using stainless steel lag screws and urethane caulk.

 

[jdemaris]

Originally I was getting a 36 panel system at 170w per panel, my local town (according to the installer company) was saying "No" because the layout would have a little overhang on the top (for which I didn't care).
So then Akeena proposed a smaller system with 30 panels at 175w each:

Your are getting quite a bit less equipment for more money then my installation - but as I said. I was able for buy much of the equipment myself and not let the installer get the mark-up. In fact, I paid close to $1000 to ship my solar panels here from Arizona, and they still wound up being much cheaper than from a local dealer/installer.

In regard to your town and not allowing overhang? Sounds silly to me - but I don't know how codes work in your area. Here, either something conforms to International Building Code used by the State of NY, or it does not. Only say the town has is for zoning infractions - or a few special rules in the middle of the village and historical district.

One thing to watch is your property value and taxes. Here and most areas, it is illegal to raise the property assesment due to a solar electric installation. But some areas allow it, and do it.

The inverter you're getting is cheaper-built than the lower voltage units - simply because it can get by with a lot less wires inside with a DC input as high, or higher than the AC output.

I guess it all depends on why you are buying the system to start with. If it's just an attempt to save on your electric bill - it's questionable if that will ever happen. But maybe, especially if rates go sky high. If you want some independence, you are NOT getting it. If there is a disaster, and the grid is down for weeks - your solar panels will be sitting there doing nothing - even if the sun shines 24 hours a day. That aspect drives me nuts and is why I installed something different. Now, if you're good with high-tech electronics, any of these inverters can be forced to work with the grid-down - but technically, it's illegal with your type of system.

I've got two solar-electric systems in two locations. The grid-tie here at home, and an off-grid up in the Adirondacks. I have to say, the off-grid is a pleasure. But, I don't live there full-time. The really annoying thing about off grid is . . . sometimes you're making 10 times the power you need and it's all wasted. No way to save it for later when the sun is gone.

Good luck, and I'm not insulting your system. It's just not what I'd ever want since my motivation was some indepence and ability to get by if the grid takes a long-term crash.

Battery-backup grid-tie is becoming more common, and I bet in a few years as consumers get more aware, few will be willing to install a system that will not work when the grid is out.

 

[geek]

yeah, I forgot to mention, I'm doing this because I want to be eco-friendly (mainly) and also to save a bit on electric bills. If I show you my electric bill you'd say I'm nuts spending this money in PV, the highest bill in summer with central AC is about $145.

Last month the AC was off and the bill about $105, in Nov. and Dec. it gets a bit higher to Christmas decorations.....you know.
We are very conscious when using lights and all that, as a matter of fact we don't use the dish washer at all (we do it by hand to save on hot water) and try not to use the dryer whenever we can (expose cloths to the sun in the backyard when possible).

The first system with 36 panels was going to cover about 95% of my electricity needs producing about 6,120kw/year if I remember correctly. I don't know how much this one will cover but it should be in the 80% or higher range.

Also, my town will not tax on the increased property value assessment, the town tax clerk already confirmed this by phone.

 

[geek]

also, I thought the sunny boy inverters are one of the preferred brands out there......

 

[jdemaris]

also, I thought the sunny boy inverters are one of the preferred brands out there......

Different dealers and installers in different regions have many "preferred" brands. From what I've seen, they often prefer to install whatever is the easiest and makes them the most money.
Nothing wrong with SunnyBoy brand. When I said it's "cheaper", I meant the general construction of any inverter that requires a very high-voltage input. The higher the voltage input, the smaller, lighter, and cheaper to construct - and also - the least useful overall. Just good for one purpose.
For such high-voltage-input inverters - Sunnyboy and Fronius seem to be the most common in my area.
Sunnyboy makes many other inverters - some for battery backup in mind, and the Sunny Island for off-grid. I never heard anything bad about any of the companies - except bad support and high prices from Beacon. Generally speaking, Trace and Outback are the most popular in the world and Sunnyboy the most popular in Germany. According to legend, the people that created Outback were former Trace employees.

In my area, just about all the installers buy their packages from the same major distributor in Kingston, New York. So, they simpy pick and choose whatever is in the latest catalog of packages. By the time you get the equipment, it's gone through many hands - all taking their profit-cut.

 

[mikeathens]

I can't remember exactly, but my 4 kW array (Sharp 170 watt panels, Sunnyboy 5000 watt inverter, installation, etc, etc) was around $31,000. State of Ohio grant at that time totaled about $14,000, taking 4% shading into account. My federal credit will be $2000. Total "out of pocket" costs after incentives about $15,000.

My understanding is that now, the federal tax credit will be 30% of the remaining balance after state funding. In my case, it would have been something like $5100 ($3100 more), bringing my "out of pocket" costs to $11,900.

Soooooo, probably worth the wait. Of course, you'll now have to find a local bank willing to give you a loan if you don't have the cash. Plus, I'm sure that costs have gone up quite a bit. Probably not as much as the added credit, but that will most likely cut into the benefits of the extra credit. For what it's worth, I found that I could have done the install myself for about $5000 less, but had to go with a "certified" installer to get the state benefit.

This isn't a to-the-dollar analysis, but hopefully will help. Good luck with the install!!

With the renewed state incentive program and the increased federal tax credits, I am going to go for that solar-thermal system to do away with propane hot water.

Edit: Here's the description of the way the credits will work as posted by my installer: http://www.dovetailsolar.com/incent.htm

 

[jdemaris]

I
Soooooo, probably worth the wait.

Waiting might not work for the Federal tax exemption. For other incentives, you can qualify going by the "turn on" date of the system. But, with the Federal, it goes by when you paid for hte equipment - not when it's first used. So, all depends on what he pays for and when.

 

[geek]

I
Soooooo, probably worth the wait.

Waiting might not work for the Federal tax exemption. For other incentives, you can qualify going by the "turn on" date of the system. But, with the Federal, it goes by when you paid for hte equipment - not when it's first used. So, all depends on what he pays for and when.

Are you positive??

I am told that for the new tax incentive (goverment) it is based on when they make the interconnection (turned on) by your electric supplier.......

My system is being installed at end of this month by the company will hold the paperwork for interconnection UNTIL Jan.09 so I qualify for the new tax incentive.

 

[mikeathens]

I must have missed something...I thought you were considering holding off on installing the system, not just connecting it. You will want to do some checking with your installer and/or tax expert. Otherwise, you are looking at $2000 when you do your taxes in a few months (vs. $5200 or so). I personally would think that you will get the lesser credit on your 2008 taxes based on "install" date. Might as well see if they can hold off on installing.

 

[geek]

we are installing the system but making the interconnection in Jan. 09.

I was told by Akeena (the installer company) that what matters to qualify for the new tax rebate is the interconnection date, not when the system was installed.

I'll do more checking.........

 

[jdemaris]

Are you positive??

I am told that for the new tax incentive (goverment) it is based on when they make the interconnection (turned on) by your electric supplier.......

My system is being installed at end of this month by the company will hold the paperwork for interconnection UNTIL Jan.09 so I qualify for the new tax incentive.

I've filed two years to get my tax exemptions - and the Feds required receipts to show when payment was made for the materials. That date is what they go by - not when you energize the system. This is from the interpreation of the guy that did my taxes - who is an retired IRS guy. Some of this stuff, the way it is written, is not exactly crystal clear.

The following is the exact wording from the Feds:

"A taxpayer may claim a credit of 30% of qualified expenditures for a system that serves a dwelling unit located in the U.S. used as a residence by the taxpayer. Expenditures with respect to the equipment are treated as made when the installation is completed. If the installation is on a new home, the "placed in service" date is the date of occupancy by the homeowner. Expenditures include labor costs for onsite preparation, assembly, or original system installation and for piping or wiring to interconnect a system to the home. If the federal tax credit exceeds tax liability, the excess amount may be carried forward to the succeeding taxable year. "

"Maximum credit of $2,000 for systems placed in service from January 1, 2006, through December 31, 2008. "

"No maximum credit limit for systems placed in service from January 1, 2009, through December 31, 2016. "

Note it states that the Feds regard "expenditures" as made when the equipment installation is completed (not later turned on). That is a little ambiguous and I guess, open to interpretation. My tax guy says it will go by when the payment is made. If you install and pay now, and turn on later - no good for claiming later - at least according to him. I am, by no means, a tax expert.

 

[geek]

I agree with you that it is ambiguous and confusing, because of this:
"No maximum credit limit for systems placed in service from January 1, 2009, through December 31, 2016.“

so this would mean the interconnection.....

Geez, this is going to be a problem and I must make a decision soon.

..

 

[geek]

lastly, did you file electronically and had to send the receipts separately?

I file electronically and obviously never send in any paperwork for my taxes..

and yet, another question, why you had to claim this 2 years in a row? don't we get the rebate in the first year?

 

[jdemaris]

lastly, did you file electronically and had to send the receipts separately?

I file electronically and obviously never send in any paperwork for my taxes..

and yet, another question, why you had to claim this 2 years in a row? don't we get the rebate in the first year?

The guy that did out taxes filed electronically. But, he told us to make sure we had the dated receipts on hand, if needed later.

In regard to the two-year thing, perhaps I mis-spoke (or mis-typed, or mis-keyboarded, etc.). The New York State income- tax exemption took us two years, not the Fed. It has a max. limit per year, and can be carried over to the next, if needed. Our exemption exceeded the first year limit, so we carried it to the second year. If we had exceeded what could be taken in two years, we would of lost the rest of the exemption - i.e. it has a two year total time-limit.

 

[geek]

ah, ok.

Here in CT the installer can claim the state rebate, so this happens right away I think (they get the money right away).

Another thing is, if a system qualifies for the new tax rebate because it gets installed/turned on in Jan, I wonder if this can be claimed when we file our taxes in April, or this would qualify for 09 taxes done in 2010.