Valuable Solar Incentives Expire December 31, 2011!
/ Thomas Ball, REP
Businesses investing in a new solar system can use federal tax incentives to pay for more than 70% of the system. But as of Dec. 31, 2011 the two largest incentives are expected to end.
Property owners eager to maximize their returns and lower utility costs – need to act now!
Federal and State tax incentives, bonus depreciation and other financial benefits are scheduled to decline and expire, creating the need to act quickly to maximize investment returns.
The two primary Federal Incentive Programs for renewable energy are set to expire at the end of this year will affect the cost and financing for renewable energy projects.
- The Federal Cash Grant Program called the '1603 Grant' is ending. This program gives solar owners the option of receiving a cash payment for 30% of the total cost of their solar system – instead of a 30% federal tax credit that most businesses and individuals can’t fully use.
- 2. The rules for depreciation are also changing. Eligible solar projects submitted before Jan. 1, 2012 qualify for 100 percent of the project cost to be expensed/depreciated in the first year. The Modified Accelerated Cost-Recovery System (MACRS) program downgrades its 100% first year bonus depreciation to 50% after December 31, 2011.
Now is the Time Invest in Renewable Energies
The 1603 Grant Program will expire on December 31, 2011.
The MACRS program downgrades its 100% first year bonus depreciation to 50% after December 31, 2011.
With these incentive opportunities disappearing at the end of this year, now is the time to take advantage of them. Solar and other renewable technologies can provide a 12% to 20% return on investment, and significantly lower cash flow and operating budgets.
Oversupply and Falling Prices of Solar Panels
- Panel oversupply is keeping prices low – for the time being
- The local solar industry market has seen a noticeable drop in demand for solar panels for installations. Thanks to the over-saturation of panels, current prices remain low. The lower purchase price combined with the existing (and expiring) incentives, make it an ideal time to invest in solar.
- Competition is cut-throat – and that means installers are cutting corners where they shouldn’t
- This increased interest has been the catalyst for the green revolution, creating intense competition among manufacturers, installers and financiers, all competing to win your business. While these participants mean well, they may not always have your best interests in mind.
- Potential risks from roofing and electrical problems could wipe out all future savings…
- Potential risks exist that could not only wipe out any future savings, but actually increase costs over the long run if not properly addressed. ABB's focus is to protect the client’s best interest and assist with evaluating rooftop and site conditions, financing options, technology selection, contractor vetting and quality assurance.
- Solar is a sound financial investment with real environmental benefits
- Solar is not just a financial investment, but also an investment in a sustainable future by cutting greenhouse gas emissions and reducing our carbon footprint. Solar energy is environmentally friendly, a reliable and renewable resource, does not consume any fossil fuels and emits no pollution. Solar truly is a renewable energy solution.
For more information call Tom Ball at 805-453-5244 or email him at tball@abbae.com.
