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Incentives for DIY Solar Installations

07-13-2010
Category: Solar Policy and Incentives

When it comes to do-it-yourself projects, a solar energy system is fun, challenging, and rewarding. Among the benefits of a do-it-yourself solar installation are the satisfaction of reducing your carbon footprint, the challenge of laying out your system, and the savings on hiring a contractor. There are, however, a few things to be mindful of while you plan your DIY project. Without a solid understanding of energy incentives, you may be passing up the opportunity for free money.

Individuals that install solar power systems in their homes are eligible for a tax credit from the federal government that covers 30% of the system's total cost. In addition to this rebate, there are hundreds of state, local, and utility company programs that will help you with the initial costs of installing your home solar panels. These can run from low-interest loans to grants that simply pay you for installing the device. If you'd like some clarification on what these different kinds of programs are, take a look at our guide to incentives for solar power.

The Database of State Incentives for Renewable Energy (DSIRE) is the site where everyone goes to get an up-to-date list of incentives available for people who want to make their homes or businesses greener. Even though it may not be the easiest site to navigate, if you're planning a solar energy system, you should definitely stop by this website to check up on local laws and incentives. The budgets for state rebate programs typically run out on an annual basis, and it's helpful to know whether or not you'll be put on a waiting list. DSIRE is a fantastic website, but it's important carefully to read the information about the incentives that may be available.

While most solar incentive programs don't come with excessive red tape, several place limitations on the installation process. You may not qualify for incentives unless your solar energy system is inspected or installed by a state-approved contractor. Below, we'll review some of the best and worst states for DIY installers and what limitations may apply in specific states. To this end, states have been divided into three categories: 1) those that provide rebates, grants, or tax credits to DIY-ers; 2) those that provide benefits, but have stipulations with regard to installation; and 3) those that do not offer substantial incentives. States in the latter category may have some tax exemptions, loans, or other incentives, but they are not substantial. Also keep in mind that even if you don't have a state incentive, there may be incentives from your local government or utility company; be sure to check DSIRE to see what you are eligible for.

DIY-Friendly

Alabama, Arkansas, Arizona, California, Georgia, Hawaii, Iowa, Idaho, Illinois, Kentucky, Louisiana, Massachusetts, Maryland, Michigan, Mississippi, Montana, North Carolina, New Hampshire, New Jersey, New Mexico, Rhode Island, South Carolina, Tennessee, Texas, Virginia, Washington, Wyoming, West Virginia

States in this category offer financial aid for people who wish to install a solar energy system themselves. Our friends in California may have some of the best solar energy policies available to them. The state rebate program allows self-installation of your residential solar system, and there are local incentives that include waivers for building permit fees and expedited licensing that can reduce the project timeline by a week. There are also dozens of rebates and buy downs available from local utilities. In the South, the Tennessee Valley Authority (AL, GA, KY, MS, NC, TN, VA) has an excellent buyback program. It will buy all of your solar power at the cost of regular electricity plus $0.12/kWh, and it will provide a $1,000 stipend just for signing up. Some rules vary among counties and utility companies, but for the most part, participants in this buyback program may install their own solar arrays. Some of the TVA states have other benefits as well, and some of them aren't for DIYers. But, for the most part, the states listed above are excellent places for an avid DIY-er to build a solar energy system.

DIY-Unfriendly

Colorado, Connecticut, Washington DC, Delaware, Maine, Minnesota, Nevada, New York, Ohio, Oregon, Pennsylvania, Utah, Vermont, Wisconsin

Each of these states has requirements on incentives that will prevent you from doing the whole solar energy system yourself. If you are in one of these DIY-unfriendly states, carefully review the material on DSIRE because they have varying definitions of "installed by an approved contractor." Some require licensing, and others simply have lists of approved installers. Recharge Colorado makes it very simple for users to find out what they are eligible for, and which contractors to contact in their area. In Utah and some other states, you may be eligible for a tax credit, but not a rebate. In any case, be sure to check for utility and local incentives.

Being DIY-unfriendly doesn't mean that these states are against solar power. New York, in particular, has an excellent set of state, local, and corporate incentives, even though New York is a northern state where solar power isn't as widely adopted as in the Southwest.

Non-Substantial Incentives

Alaska, Florida, Indiana, Kansas, Missouri, North Dakota, Nebraska, Oklahoma, South Dakota

In these states, there are few or meager statewide incentives for installing your home solar array. Giving credit where credit is due, some of these states (IN, KS, ND, SD) do offer tax exemptions, and Nebraska offers low interest loans. Although Florida's state rebate program is no longer in service (as of this writing), there are tons of local utility offers available there, so check DSIRE for the list. If you can't find any incentives, remember that there is still a 30% federal grant to help you out!

This article may help you be more prepared for your big DIY solar energy project. Knowledge of incentive programs and how they work is a crucial tool in helping you reach your goal of solar power, as cost-effectiveness is definitely the deciding factor when debating a solar installation. Some states have excellent programs to help pay for your system. Some states require installation (or, at least, inspection) by a certified contractor. And some states hardly offer help at all. For more information on your local policies, check the DSIRE website. Good luck, and have fun with your project!

Tags: DIY solar installation, DIY solar panel installation, DIY solar energy systems, solar economic incentives, solar rebates, solar tax credits, home solar panels, solar energy systems, incentives for solar power, DIY solar energy project


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