What Homeowners Should Know When Investing In Solar

How does the Investment Tax Credit (ITC) stack up to the Renewable Energy Grant (REG) for homeowners? We did a hypothetical cost comparison between the two based on the following assumptions:

- Type: Residential
- Utility: Southern California Edison
- Rebate: Step 3, $2.20/Watt
- California state tax on rebate (this is still to be determined)

Here is what we found:



According to the results, the incentive for the REG is greater than the ITC by more than $3,400.00. This amount is even larger if the 30% tax credit is not taxed at the state level. Below is a table summarizing this scenario. The incentive increases by $0.23/watt, adding almost another $2,300 to the difference in the ITC vs. REG. Either way you look at it, the REG offers a great way for homeowners to offset the initial capital outlay of a solar system.

Renewable Energy Grant

The enactment of the American Recovery and Reinvestment Act of 2009 includes a renewable energy grant program that will help businesses and homeowners offset the initial cost of installing a solar system. To better understand how this grant works, we’ve compiled a short list of key points to the grant that you should consider:

1. Who is eligible?
Only tax-paying entities are eligible for this grant. Federal, state and local government bodies, non-profits, qualified energy tax credit bond lenders, and cooperative electric companies are not eligible to receive this grant. Partners or pass-thru entities for the organizations described above are also not eligible to receive this grant.

2. How much is the renewable energy grant?
30% of the basis of the property for solar energy.

3. What types of solar is eligible for the renewable energy grant?
Eligible solar-energy property includes equipment that uses solar energy to generate electricity, to heat or cool (or provide hot water for use in) a structure, or to provide solar process heat. Passive solar systems and solar pool-heating systems are NOT eligible. Hybrid solar-lighting systems, which use solar energy to illuminate the inside of a structure using fiber-optic distributed sunlight, are also eligible.

4. How is the grant paid?
The U.S. Treasury Department will make payment of the grant within 60 days of the grant application date or the date the property is placed in service, whichever is later.

5. Is the grant taxable?
The renewable energy grants will not be included in the federal gross income of the taxable entity, but it is unclear whether the federal grant will be treated as taxable income in the states. Check with your CPA for more information.

6. How long will the grant be available?
Grants are available to eligible property placed in service in 2009 or 2010, or placed in service by the specified credit termination date, if construction began in 2009 or 2010. For solar this is January 17, 2017 – which means the solar property must be placed in service by this date. In addition, grant applications must be submitted by 10/1/2011 in order to reserve the grant.

DJH Construction, Inc. Adds A C-10 Electrical License Classification.

DJH Construction, Inc. is a licensed and bonded solar energy contractor. In addition to a B (General Construction) and C-46 (Solar) license, DJH has added a C-10(Electrical) license classification. The addition of the C-10 is further testament to DJH Construction, Inc.’s commitment to install high performance solar systems.

DJH Construction, Inc. Helps Bullhead City Homeowners Go Solar

Bullhead City residents enjoy year-round sunshine and those going solar are tapping into this renewable resource to power their homes. According to Solar Energy Industries Association (SEIA), the southwestern United States possesses a world-class, well-distributed, and nearly untapped solar energy resource. It is most abundant in California, Nevada, Arizona, and New Mexico.

DJH Construction, Inc., a leading solar integration company, is helping homeowners in Bullhead City tap into this free and renewable resource by going SOLAR. Five significant incentives for homeowners include: a utility rebate, a 30% tax credit, a $1,000 Arizona State tax credit, and an Arizona property tax and sales tax exemption. In order to take advantage of the utility rebates, residents should contact their local utility to see what incentives are available and to reserve a rebate. Currently, Mojave Electric Cooperative is offering rebates of $4.00/watt DC up to $12,000 and UniSource Energy Services is offering residents $3.00/watt DC up to 60% of the cost of the system.

The financial benefits of going solar extend even further for business owners looking to go green. In addition to all the benefits the residential customer receives, a business is able to take advantage of an accelerated depreciation schedule and a larger Arizona state tax credit. The Arizona tax credit is equal to 10% of the installed cost up to $25,000 for any one building or a maximum of $50,000 in total credits in any one year. This state tax credit gives business owners the flexibility to apply the credit against their corporate or personal taxes. Business owners should consult their CPA regarding the benefits of the accelerated depreciation schedule and the federal tax credit as it pertains to their unique financial situation.

"We are encouraged by the growing demand for renewable energy by the residents of Bullhead City and look forward to installing many more high performance solar systems in Arizona," said Don Harris, President of DJH Construction, Inc.

pdf version of press release: http://www.prlog.org/10190622-djh-construction-inc-helps-bullhead-city-homeowners-go-solar.pdf

DJH Construction, Inc. Announces the Completion of a 19.44 kW Residential Solar System in Santa Ana, California.

SANTA ANA, CA., February 18, 2009 - DJH Construction, Inc., an Orange County based solar integration company, announced the completion of a 19.44 kW residential solar photovoltaic project in Santa Ana, California. This project is an excellent example of how DJH Construction, Inc. leveraged it’s unique engineering and design capabilities to coordinate the planning and management of this complex installation.

The 19.44 kW solar system was completed in January of 2009 on the residence of Jeremy and Sandy Kaslow. The photovoltaic system ties together a total of 90 photovoltaic panels onto over 1,530 square feet of roof space. The estimated annual production of this solar system is 29,144 kWh, providing almost 100% of the Kaslow’s electrical usage. The environmental impact of this system is a reduction in green house gas emissions by 500 tons of CO2 over the life of the system (25+ years). The reduction in green house gas emissions is equivalent to planting 19,996 trees or driving 1,694,576 miles in a small car. In addition to the utility savings, the Kaslow’s will receive a rebate check from their utility company and a 30% tax credit. “We are pleased to provide a quality installation to our clients and assist them in taking advantage of incentives that will provide long-term financial benefits,” said, Don Harris, President of DJH Construction, Inc.

Continued support on the Federal and State level for solar will help facilitate integrating renewable energy solutions on more homes and businesses. On February 17, 2009, President Obama signed into legislation the American Recovery and Reinvestment Act - a stimulus bill that proposes to provide additional incentives to those seeking to invest in renewable energy. A key highlight to the recovery bill is the renewable energy grant that provides grants equal to 30 percent of the cost of the solar system. This program will be administered by the Department of the Treasury and is in lieu of the section 48 investment tax credit. In a recent interview, Harris said, “We are excited that the solar provisions in the stimulus bill will pave the way for the United States to become a leader in incorporating solar energy as a standard. This bill will help fuel the economy with jobs and growth amid the economic downturn. We look forward to the changes and are grateful to be a part of this rapidly growing industry."

Solar and the American Recovery and Reinvestment Act

On February 17, 2009, President Obama signed the Economic Recovery Legislation. This bill marks a historic milestone within the solar industry and proposes to create 60,000 jobs in the solar industry in 2009 and a total of 110,000 over the next two years.

Three key points to the bill specific to photovoltaic and thermal solar are:

1. Renewable Energy Grants
2. Repeals Penalty for Subsidized Renewable Energy Financing
3. Remove Limits on Solar Water Heating

The renewable energy grants is a new program administered through the Department of Treasury that provides grants equal to 30 percent of the cost of solar property placed in service during 2009 and 2010. This grant replaces the section 48 investment tax credit. (Div. B, Sec. 1104, p. 38)

The bill also repeals the penalty for subsidized renewable energy financing. This allows businesses and individuals to qualify for the full amount of the solar tax credit even if projects receive subsidized energy financing (e.g. below market loans, tax preferred bonds, state grants etc.). This amendment shall apply to periods after Dec. 31, 2008. (Div. B, Sec. 1103, p.36)

The stimulus bill also removes the $2,000 monetary cap on solar water heating, providing a full 30% credit for qualified solar water heating property (Div. B, Sec. 1122(a), p. 46). Qualified solar water heating property is defined as used for a purpose other than heating swimming pools and hot tubs. In addition, the credit may be claimed against the alternative minimum tax.

Welcome!

Welcome to the DJH Construction, Inc. site blog. We have recently updated our website at djhConstruction.com and we'll be using this blog to add news and updates throughout the coming months. Stay tuned for tips and ideas on photovoltaics, alternative energy, and greening your home.