Incentives and Financing

There are currently many financial incentives available to help off-set the up front cost of purchasing a renewable energy system.  This page will list each of the various rebate, tax incentive, and production incentive programs available for customers in Clallam, Island, Jefferson, and Kitsap Counties.  For additional information please check out www.dsireusa.org which provides a great comprehensive overview of financial incentives available in Washington State and elsewhere in the country.

Power Trip Energy will handle the paperwork for all of the applicable financial incentives for our clients, and guidance to the proper federal tax forms for you and your tax professional.  This is a substantial service that is included in our turn-key installations.  There are intricacies to some of the programs that we will be happy to explain as we work with you.

Net Metering – Get Retail Credit From Utility For All Solar Electricity You Generate

Washington State’s net metering law allows you to connect your solar electric (PV) system directly to the utility grid and requires utilities to value power generated by your grid-tied solar electric system at the same rate per kilowatt-hour (kwh) that the utility charges you for power from the grid.  Connection to the utility grid allows batteries to be eliminated as an energy storage device.  The utility grid becomes the energy storage device.  When your grid-tied solar electric system produces less power than your home or business consumes (think short, cloudy winter days) the utility grid will provide the additional energy you need.  When your grid-tied solar electric system is generating more power than your home or business uses, the excess power goes back to the grid and you will be credited for this power production on your utility bill.

Washington’s net-metering law applies to systems up to 100 kilowatts (kW) in capacity that generate electricity using solar, wind, hydro, biogas from animal waste, or combined heat and power technologies (including fuel cells). All customer classes are eligible, and all utilities — including municipal utilities and electric cooperatives — must offer net metering.

Washington State Production Incentive – SB 5939 – Enrollments Open Until June 30, 2021 (Will likely close sooner when available funds exhausted)

On July 1, 2017 the legislature passes SB 5939, a solar job bill which creates a new production incentive replacing the current version that sunsets June 30, 2020.  All new enrollments will be in the new program, which will provide steady predictable returns for 8 years, dependent on the year the system was installed, and based upon the following table:

 

Fiscal Year Certified

Residential

(Under 12 KW)

Commercial

(Over 12 KW)

Community

(Up to 1 MW, at least 10 owners, util admin)

Shared Commercial (1-5 MW)

Made in WA bonus

2018

$0.16

$0.06

$0.16

$0.06

$0.05

2019

$0.14

$0.04

$0.14

$0.04

$0.04

2020

$0.12

$0.02

$0.12

$0.02

$0.03

2021

$0.10

$0.02

$0.10

$0.02

$0.02

 

Each utility has it’s own cap on the overall available incentive pool, which is 1.5% of that particular utility’s electricity sales revenue.  There is also a more immediate cap of $100 million on the overall incentive payment payout over the entire 12 years of program life, which will surely be reached well before the 4 years of enrollments.  Once WSU Energy Extension, which is administering the program, calculates that sufficient projects have been enrolled that will exhaust this overall cap, they will accept no more enrollments.  We forecast that we have two open years of this program for this reason, despite the nominal four year open term.

We will link to WSU Energy Ext info as soon as it is posted.  View the actual bill for yourself here: http://lawfilesext.leg.wa.gov/biennium/2017-18/Pdf/Bills/Senate%20Passed%20Legislature/5939-S.PL.pdf#page=1

WA State Sales Tax Exemption

Solar PV equipment and labor for systems 10 KW and under will remain sales tax exempt until September 30, 2017.  Systems over 10 KW receive a 75% refund of their sales tax.  On October 1, 2017, the full sales tax will apply.  The sales tax exemption is being expired early as part of the bargain to get the new improved solar production incentive detailed above.  There is a golden 3 month window from July 1 – Sept 30, 2017 wherein customers can get the new and improved production incentive and also the legacy sales tax exemption.  We may not see a moment as attractive as this for a long time.

Previous Washington State Production Incentive – Program Now Closed as of 2017

In 2005 Washington State adopted the Cost Recovery Program (CRP) establishing production incentives of 12¢ to 54¢ per kilowatt-hour for individuals, businesses, or local governments that generate electricity with grid-tied power systems from solar power, wind power or anaerobic digesters. In 2008, the program was extended and expanded.  The overall incentive pool is capped at 0.5% of taxable utility revenue and the incentives are capped individually at $5000 per year. These incentives are in addition to the savings you can achieve through net metering.  The production incentive rates depend upon the source of your energy and whether your equipment was manufactured in Washington State.    The incentive rates are:

  • For electricity produced using out of state solar modules and inverters the rate is $0.15 per kilowatt hour (kwh);
  • For electricity using solar modules manufactured in Washington state with an out of state inverter the rate is $0.36 per kwh.
  • For electricity using both solar modules and an inverter manufactured in Washington state the rate is $0.54 per kwh.
  • For electricity produced using a solar or wind generator equipped with an inverter manufactured in Washington state the rate $0.18 per kwh;
  • For electricity produced using an anaerobic digester or using a wind generator equipped with blades manufactured in Washington state the rate is $0.15 per kwh;
  • And for all other electricity produced by grid-tied wind the rate is $0.12 per kwh.

Participation in the Cost Recovery Program is voluntary and varies from utility to utility.  Currently on the Olympic Peninsula Jefferson PUD, Clallam PUD, Puget Sound Energy, and Mason Co. PUDs #1 & #3 all participate in this program.  Participating utilities will pay the incentives to the producing customer and earn a tax credit from the State of Washington equal to the cost of those payments.  The incentives apply to power generated as of July 1, 2005, and are currently slated to remain in effect through June 30, 2020.

Each utility has it’s own cap on the overall available incentive pool, which is 0.5% of the particular utility’s electricity sales revenue.  This cap has been reached in Jefferson County and we are forecasting that the 2015/2016 annual payments will be at 50% of the full rate.  The cap has also been reached in Clallam County  PUD & PSE in Kitsap County in which we are forecasting payments will be at 80% of the full rate.

Link to additional information on production incentives:

Federal Tax Credit – 30% Federal Tax Credit on Solar PV System Installation

Residential and commercial customers who install solar electric systems qualify for a federal income tax credit equal to 30% of the cost of their solar electric system under the ITC (Investment Tax Credit). A tax credit is a dollar-for-dollar reduction in the income taxes that a person or company claiming the credit would otherwise pay the federal government. This is available thru December 2019. 

After December 2019, we’ll see step down in the Federal Tax credit to 26% in 2020 and 22% in 2021. 

As of 2014 these links contain up-to-date information on the Federal Tax Credit.

Solar Financing –

We are often asked if financing is available for solar projects.  We will share information on low interest finance programs as we become aware of them.

Puget Sound Cooperative Credit Union – many of our clients recently have been taking advantage of the Energy Smart Loans from PSCCU.  We have enjoyed the ease of working with them, and our clients have all given good reviews of the customer service.  This is the personal financing we have been waiting for before being able to enthusiastically endorse using personal financing as a smart option for anyone to install grid-tied pv.  You can learn more and even apply online here http://www.psccu.org/efficiency.php#energysmart

Home Equity Loans – Any private lending institution at market rates. 

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