SUR Energy: Government and Utility Based Incentives
Government Incentives
One incentive that is scheduled to be around for an eight year period is the 30% federal tax credit. “Credit” means the Federal government reduces your bill if you owe them money. If you already have a credit in the year the system is purchased the credit can be rolled forward to the next year’s tax bill. For example, if you spend $10,000 on a solar electric, solar hot water, or wind system, the government credit will be $3000. If you have a Federal tax bill of $4500 without solar your new tax bill will be $1500. Because it is a “credit” it changes your bill by 30% of the cost of the system. You can also install multiple systems in the same year, for example solar electric, wind turbine, and solar hot water.
Visit Dsireusa for more details on Government Incentives
Utility Based Incentives
In Michigan there have been two major incentive programs from our two largest utilities: SolarCurrents® from DTE Energy and EARP from Consumers Energy. These are two very different systems with different requirements and benefits. As of this writing (Sept. '09) the two existing programs are not expected to last for a long time.
The DTE Energy program, SolarCurrents®, is a system that allows DTE to acquire "Renewable Energy Credits", also called "REC's". The need for REC's comes from laws passed in ‘08 which require the utilities to make sure a portion of the energy they sell comes from renewable sources, like solar, wind, and hydro. The laws are referred to as “Renewable Portfolio Standards”, or “RPS”. DTE will meet these requirements in several ways. They will likely install and own wind and solar equipment. They will also buy solar and wind energy from utility scale suppliers. Another method allowed by the MPSC (Michigan Public Service Commission, which regulates some Michigan utilities) is to assist homes and businesses in the DTE territory in putting in solar electric (PV) systems of their own. When DTE “buys” the Renewable Energy Credits they are paying for the right to say a portion of the energy they sell originates from renewable resources. Once you enter a contract with DTE you cannot sell the RECs to any other utility or third party REC dealer. Because DTE has paid for a portion of the system and makes continuing payments based on energy production they can claim to be meeting the requirements of the Renewable Portfolio Standard. We encourage you to
Download SUR's Payback Analysis of SolarCurrents® for more details about the financial mechanics of the program. Please
View the SUR System Components Power Flow for more details about system components.
Consumers Energy EARP (Experimental Advanced Renewable Program) “EARP” is Consumers Energy’s version of a renewable energy feed-in tariff. With a feed-in tariff your equipment feeds the energy directly onto the utility grid on the other side of your existing meter. You continue to pay the utility for 100% of the energy you use at the standard rated. You will get a separate second meter that goes between your generating equipment and the utility grid so that they can pay you for what you generate. These essentially are two separate payments tracked by two separate meters. You pay them based on what you use and they pay you based on what you generate. The nice thing is they are going to pay you at a higher rate for a specified period of time. We encourage you to
Download SUR's Payback Analysis of EARP for more details about the financial mechanics of the program.
Incentives: Staying Current
As fast as the incentives are changing we are not going to attempt to stay completely current on this website. There are plenty of excellent sites on the web that do just that. In our opinion the best is Dsireusa, which is maintained by Sandia Labs for NREL, the National Renewable Energy Lab. When you get to the Dsireusa site, click on the state of Michigan. From there you are presented with many options for which summaries you would like to see. When you read through the summaries there is contact information and other links to more detailed information, usually to the originator of the incentive, for example, IRS forms.
Visit Dsireusa to explore the latest incentives
