Connecticut Solar Rebates, Incentives, and Tax Credits

What state other than Rhode Island failed to ratify the 18th Amendment (Prohibition)? You guessed it, Connecticut. If that isn’t reason enough to love this state then wait til you hear about the all progressive steps that are being taken to really advance the adoption of clean energy technologies like home solar power systems and the Connecticut solar industry. In 2000, The Connecticut Clean Energy Fund was created by the Connecticut Legislature to develop a comprehensive plan that proposes strategies to support renewable energy sources, and to stimulate demand for renewable energy. To learn more, please click here to download CCEF Talking Points – 2nd Quarter of FY 2010.

 

Net Metering

Good news unlike other states (Massachusetts a New York to name a couple), there is no stated limit on the aggregate capacity of net-metered systems in a utility’s service territory. Any customer net excess generation (NEG) during a monthly billing period is carried over to the following month as a kilowatt-hour (kWh) credit. At the end of an annualized period, the utility pays the customer for any remaining NEG at the utility’s avoided-cost rate. In January 2008, the Connecticut Department of Public Utility Control (DPUC) ordered Connecticut Light & Power (CL&P) to calculate the reimbursement for PV systems, for any NEG at the end of an annualized period, on a time-of-use/generation basis. This significantly increases the financial benefits of net metering for PV system owners.  For example, at present, CL&P’s residential charges total about 19¢/kWh, two to three times the past average reimbursement.  The new reimbursement mechanism significantly increases the financial benefit of owning Class I renewable generation. Go forth and make solar power!

 

Property Tax Exemption

Connecticut provides a property tax exemption for “Class I” renewable energy systems* and hydropower facilities that generate electricity for private residential use. The exemption is available for systems installed on or after October 1, 2007, that serve single-family homes or multi-family dwellings limited to four units. In addition, “any passive or active solar water or space heating system or geothermal energy resource” is exempt from property taxes, regardless of the type of facility the system serves.
Sales and Use Tax Exemption

Connecticut enacted legislation in June 2007 that established a sales and use tax exemption for solar energy equipment among other renewable systems. The sales and use exemption covers both the equipment related to eligible systems, and labor (services) relating to the installation of eligible systems. The exemption has no expiration date.

 

State Rebates

The lovely state of Connecticut offers a $1.75/Watt rebate for first 5 kW and $1.25/Watt for an additional 5 kW.

However, starting March 1, 2010 all applicants must participate in Clean Energy Efficiency Fund’s Home Energy Solutions (HES) program. See the Home Energy Solutions affidavit for more information. So if you have had an energy audit in the past 3 years you should be fine but if you haven’t you need to register for the HES program via http://www.ctenergyinfo.com or by calling 1-877-WISE-USE (1-877-947-3873).

 

Incentives

The “Mass Energy Renewable Energy Certificate Incentive” program falls under the Energy Consumers Alliance of New England (ECANE), which purchases Renewable Energy Certificates (RECs) from solar-electric power generation from Connecticut’s residential, commercial, industrial, nonprofit, schools, and institutional sectors. Currently, ECANE will purchase the RECs for 3 cents per kWh for a period of three years. The program is described on their website.

 

Example

LocationHartford
Av. Monthly Electricity Bill$133
System Size5.5 kW
% Reduction in Electricity Bill93
Cost / Watt (installed)$7.00
Cost Breakdown
Total Cost$38,500
Rebates
State Rebate ($8,750 rebate for first 5 kW and $1,061 for an the additional 0.5 kW)$9,811
Federal Tax Incentive$8,607
NET COST$20,082
Payback period12 yrs
Cash Flow
New Av. Monthly Electric Bill$24
Monthly Loan Payment$134
Tax Saving$42*
NEW MONTHLY NET COST$116
Cummulative Lifetime Savings$41,795 over 30 years
Environmental Benefits
CO2 Emissions Saved6,531 lbs

* Tax savings will decrease as the principal is paid down. Please consult your tax preparer.


So if these savings look attractive to you then why not find out if solar will work for you. Fill out our quick and easy form and have we’ll have Connecticut solar installers contact you to discuss your options.