There has been so much talk lately about renewable energy installation incentives and grants. The most frequently heard question around here is, “are there any incentives left”?
In a word…ABSOLUTELY. In fact, right now may be the best time ever to invest in solar. With module pricing at an all-time low, now is a great time to maximize the benefit of available funding for low net system pricing. Here’s an update.
Federal Renewable Energy Tax Credit
This tax credit was established in 2005 and is still available to all who pay federal taxes. This is a 30% tax credit, based on the total installed cost of a renewable energy system. What if my tax load is less than my tax credit? No worries, this credit can be rolled over to next year, and the year after.
But don’t be lulled into complacency. This 30% tax credit is scheduled to end in 2016, reducing to a 10% tax credit after the deadline. Don’t let this huge incentive go by without taking advantage of it.
Wisconsin’s Focus on Energy program
Focus on Energy has released their incentive programs for 2013. For the most part they are unchanged from the second half of 2012 at $600 per installed kW. New for 2013 is an expansion of the system size cap from 2kW to 4kW, so incentives for PV systems are now capped at a more generous $2,400. Solar hot water systems still capture up to $1,200 for qualified systems. The parameters and dollar amounts shouldn’t change for the entire year making them stable and predictable for the first time in quite a while.
However, please note that this funding can be suspended or revoked based on how much is spent on technologies that the administrators of the program view as more favorable in terms of benefit to cost. So, if there aren’t enough anaerobic digesters or geothermal systems being funded, then Focus will have to close the spigot on solar and wind systems being funded until there are. This is kind of an unfortunate way to run an incentives program. What this means is that incentive applicants should try to get in the queue as early as possible in the year in order to be guaranteed availability.
The USDA Rural Energy for America Grant
For eligible farms and rural businesses, this grant can provide up to 25% of the installed system cost for solar, wind and anaerobic digesters. It is a competitive grant and the application is not for the faint of heart. If you’re serious about solar in 2013, we can put the grant application together for you. The deadline for this year is March 31 and there is a large amount of information to put together, so get in touch with us soon if you’re interested.
To broadly summarize, let’s describe a farm or business that would be considered a strong candidate for the REAP grant. A strong candidate would;
• Have not received a REAP grant in the past 12 months
• Have a farm/business that is located in a rural area. Luckily, that’s all of us here in central Wisconsin. Yes, even the city of Wausau.
• Be classified as ‘small’. For most agricultural operations, you are small if you have less than $750,000 in gross revenue in 2012. Other businesses have a higher gross revenue threshold, such as a school bus service, which would be considered as small if the gross revenue was less than $7,000,000 in 2012. We have the master list and can help you classify your business.
The strongest grant candidates would:
• Be a very small business. This is defined as gross receipts of less than 1 million and less than 15 employees.
• Install a renewable energy system that will offset more than 50% of your current energy usage.
There is much, much more, but these are the big pre-qualification questions.
Are you a REAP grant candidate? Do you know a farmer or business that is? Now is the time to move. The deadline for grant application submission is March 31, 2013. Funding for 2014 REAP grants, which are tied very closely with the Farm Bill, is very much up in the air.
Solar and Wind Energy Equipment Exemption
In Wisconsin, the value added to a property from a solar or wind system is exempt from general property taxes. Well isn’t that great! All you need to do is file a request between January 1 and March 31 in the year after you install the system. Improve the market value of your property without raising taxes!
Wisconsin Sales Tax Exemption
In Wisconsin, solar and wind equipment is exempt from sales tax. How nice!