Wednesday, February 08, 2006

Solar Sightings No. 5 -- Why solar is cheapest for business installations

Hello future solarDwellers:

Check out the interesting curved mounting structure holding these solar-electric panels. This is a commercial building in Oakland, CA, a realty company

The single most economical and best market, hands down, for solar-electric(PV) installations is the commercial/small business market. Why? The tax benefits combined with solar state rebates, and especially the new federal tax credit, make solar pv substantially cheaper for commercial installations than for residential, especially on larger systems.

A simple (rough) example: a very large 10kW residential system would cost about $95,000 - 28,000(CA rebate) = $67,000. Then, the fed tax credit is 30% of that amount, but with a max credit of $2,000 for residential:
$67,000 - $2,000 =

$65,000 for residential 10 kW system.

The same 10kW system for a commercial/business installation would be the same after the CA state rebate ($67,000), but instead of capping the new federal residential tax credit at $2,000, you could take off another FULL 30%:
$67,000 - $20,100 = (Wow! Take off $20,000 instead of $2,000!!!)

$46,900 for commercial 10 kW system!

Same size systems, but the homeowner's cost is $65,000, and the business owner's cost is only $46,900. Is that an incentive for businesses or what???

On top of that, businesses receive the additional tax benefit of accelerated depreciation, reducing their taxes even further.
I guess there's nothing new here: tax/rebate systems, politically and economically speaking, have always favored the business owner vs the average consumer.

So, business owners, here's your golden chance to step up, market yourself as a green business, take advantage of this tax-favored status until the end of 2007 and reduce emissions from our power plants, making our air cleaner. Green for the environment; green for your bottom line!!!

Power on,
--your solarDweller
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