The Top 9 Questions to Ask When Considering Solar
Solar photovoltaic systems transform the sun’s rays into energy using solar panels. Photovoltaic systems often represent a significant investment of time and resources. As with any large investment, you will want to begin by asking the questions that will lead you to the best possible option for your situation.
#1 How much energy do I use now?
You should begin your search by determining how much energy you use, currently, to run your home. This little nugget of information will help your installer determine what size system you will need. If your needs are minimal, but solar is important to you, you may decide to work with a neighbor to create a joint solar photovoltaic system or join a local CSA (see question #3).
#2 How much sun does my property receive throughout the year?
Every property receives some sunlight each day, but you will want to make sure that your property receives enough sunlight to provide adequate power for your home. If you have mountains blocking the sun at key times during the day, community solar may be a better option for you (see question #3). If you have a few trees in the way, you might opt to take them down (maybe use them as firewood—another renewable resource) to open a pathway for the sun.
#3 Does it make more sense to join a CSA?
CSAs (Community Solar Arrays) are a wonderful option for people who cannot, or do not, want to have a solar array on their property. A CSA is an array of solar photovoltaic panels hosted on a local property. You purchase a share in (percentage of) the CSA and receive, in return, your share (percentage) of the electricity that is generated by the solar array. In simple terms, if you pay .5% of the costs associated with the array, you receive about .5% of the electricity generated by the array.
CSAs come in a multitude of shapes and sizes and can include an array on your neighbor’s property that one or a few families tie into or large neighborhood arrays serving tens or hundreds of homes. They can even be company- or utility-owned. Options for this resource are expanding in Vermont as people realize the benefits of sharing solar energy.
#4 Where should I install solar on my property?
Solar panels are generally installed on the roof of the house or another structure, or mounted on your property where the sun is most abundant. Talk to your solar installer about the best location for your panels. You will want to consider how the panels will look once they are installed on your roof or on your property, and make sure you’re happy with how they will look. If you live in a historic neighborhood that does not allow visible solar panels, you will want to check with town officials before you begin your project.
#5 What energy tax credits, grants, and incentives are available in my state?
The big tax incentive on the table right now is a 30% tax credit offered by the federal government for qualifying solar projects. Credits, grants, and incentives are always changing so ask your tax professional what options are currently available for your specific project.
#6 What about grid-tied systems and net metering?
Net metering enables grid-tied customers to receive credit for solar-generated energy they don’t use. Vermont state law requires that utilities provide some value (called “solar adder”) for solar net metering, for the first ten years you have your solar array. Green Mountain Power offers a credit for each kWh of solar you produce, but not all companies offer the same credits, so you should ask your electric provider about their rate structure for net metering.
Net metering is wonderful because it goes both ways. You are tied into the electric company so that when you are generating an excess of electricity (usually in the summer months), it goes back to the grid and you receive a credit. When you’re not generating enough electricity (usually in the winter), you can cash in on your credits and, if/when you use up your credits, pay only for the electricity you need.
Note: State net metering regulations are subject to change, so contact your electric utility to learn what options are available to you.
#7 Will the solar array increase my property taxes?
In 2013, Vermont enacted a 100% property tax exemption on solar photovoltaic systems that are 10kW and smaller. In 2014, the legislature expanded the exemption to cover systems up to and including 50kW. To put these numbers in perspective, the average residential solar photovoltaic system is about 6kW. Your local CSA may be taxed for its array, but your home (unless it is exceedingly large) will not.
Note: Net metering regulations are subject to change; this may impact property tax calculations.
#8 How will I finance the system?
Even after taking advantage of available incentives and tax credits, most people find they need to finance the project. Some solar providers offer financing, or they may recommend working with a local credit union or bank that offers solar loan programs. The best way to finance your installation is through an Energy Improvement Loan that offers longer terms and discounted rates. Depending on your location, you may also be able to take part in the Property Assessed Clean Energy program (PACE), which offers low-cost, long-term financing at a fixed rate for up to 20 years.
#9 Will solar save me money in the long run?
Determining whether you will make out in the end, considering your specific situation, requires some paperwork. Pool the information you have collected to add up the costs associated with the installation, subtract the rebates and incentives, and determine how old your system will be when you have paid off any financing agreements. Your installer and/or bank or credit union associate can help you with these calculations.
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