Tax Credits & Rebates
Every American building owner gets a 30% federal tax credit for installing new solar systems. Details are different between homeowners and other buildings owners. Homeowners get 30% of the cost after any subsidy, such as a rebate because the IRS does not consider rebates to be taxable income. Think of it as your out of pocket cost. Commercial building owners of all types get 30% of the total project cost. The rebate is considered taxable income, and you receive an accelerated depreciation.
Many power companies in Colorado offer rebates. In fact, 38 states now have rebate programs going and more are coming online soon.
In Colorado, continuing rebates programs are operated by Xcel Energy, Black Hills Energy, Holy Cross, Aspen Municipal, Pepco and Colorado Springs Municipal. Other power companies offer limited budget programs which are often matched by the Governor's Energy Office.
Rebate programs plus the federal tax credit make photovoltaic systems very affordable. We can carry the rebate, allowing your out of pocket cost to be a lot lower than the total system price.
Black Hills Energy and Xcel Energy offer two levels of rebates: small system rebates (up to 10 kilowatts) and medium system rebates (up to 100 kilowatts). The small systems, for residential and commercial, involve up to 10 kW– twice the size needed to zero out the average home electricity bill– and have the largest rebate at $3.50 per watt. This covers about two thirds the cost of your system.
If your commercial building has more than one meter we can put a small system on each meter. The medium system rebate is for commercial buildings and have a rebate of $2.00 per watt, plus Black Hills Energy and Xcel Energy pay a premium of 11.5¢ per kilowatt hour (kWh) produced, making the medium systems the most profitable over time. That's about six times the open market rate for renewable energy credits in Colorado.
All Colorado Power Companies Pay You Retail
With a photovoltaic system you are selling the electricity you produce to your power company directly through the same meter you use to buy from the grid. They will install a new Net Meter that runs backwards, recording the kWh you are generating to offset your usage, purchasing what you produce for the same price they charge you. Produce the same as you use and you zero out your bill. If you produce more electricity than you use, your energy company will pay you wholesale for the excess wattage you produce. Most commercial buildings don't have enough rooftop or ground space to completely zero out their bills.
We will work with you to design your ideal solar PV system, keeping in mind three key considerations: your goal, budget and available space.
Ask us for more information regarding the rebate and tax credit programs. Then be sure to consult with your own tax professional.