Solar rebates and government tax breaks can put a huge dent in the price of your solar system. Many states have generous local incentives aimed at building the solar capacity and doing a solid for the planet. Texas isn’t one of them.
Here in Houston, pretty much all we have is the Residential Renewable Energy Tax Credit, a federal incentive that kicks you back 30% of the cost of your system on your next tax return. This in itself, however, makes a huge impact on the financial feasibility of a solar system, reducing the payoff period from 13 or 14 years down to less than 10. In other markets, the cost of grid energy, coupled with larger state or local incentives, results in payoff periods as short as three years.
Solar rebates are great…but only in moderation
Some in the Texas business are agitating for more generous solar rebates and incentives, but not us. In states where local tax breaks are making solar artificially cheap, the market is flooded with hacks who are under cutting reputable installers to make a quick buck. It’s a race to the bottom, and people are trusting the contenders to drill holes in their roofs. While you should always be price conscious, solar installation probably isn’t the sort of thing you want to trust to the lowest bidder.
As we see it, the 30% federal credit is just enough for solar to make sense for forward-thinking buyers, and the result is a healthy Houston market that is poised for sustainable growth. Yay us!
What does the future hold for solar rebates?
Frankly, we don’t know. The federal tax credit has been a boon to the solar industry, making systems accessible to a much wider range of people. And the country has benefitted, by building a smarter and more agile energy grid. The 30% credit is set to expire at the end of 2016, and predicting anything Congress does before they do it has always been a fairly tall order. Due to the uncertainty, 2016 is, no doubt, a year when going solar makes all the sense in the world.