There are several financial incentives that make developing a solar array a good investment for business and property owners.
These incentives include:
Attractive Tax incentives from the federal government in the form of:
- A 30% Income Tax Credit (ITC) of the system price for newly deployed solar PV systems through 2019, which will decline in value incrementally from 2020-2022.
- Accelerated Depreciation incentive (MACRS) to help further business investment
State financial incentives in the form of:
SRECs (Solar Renewable Energy Certificates)
In Massachusetts, the Green Communities Act of 2008 requires utilities in the state to generate at least 15% of electricity from renewable sources by 2020. One way they can meet this requirement is through the purchase of SRECs from solar PV system owners; one SREC equals 1000 kilowatt hours (kWh) of electricity produced. Massachusetts possesses a robust SREC market that provides significant revenue streams to solar array owners ranging from $285 to $350 per SREC.
Distributed Generation Contracts
In Rhode Island, the Distributed Generation (DG) Standard Contracts Program was enacted by the state legislature in late 2011; The “DG Contracts Program” requires the local utility (National Grid) to support 40 MW of renewable (solar/wind) energy deployment over the next four (4) years. National Grid will purchase the electricity produced from qualified solar systems at a guaranteed rate for 15 years via these DG Contracts.
Net Metering regulations
Net Metering allows excess energy to be “sold” back to the grid. When solar system owners generate electricity, their electric meter turns backwards; and when they generate more electricity than they use in a given month, the owner’s account is credited by the utility. Sometimes that credit can even be transferred to other accounts within the utility’s serving area which allows for flexibility and business opportunity.