The top solar states in this country are not just the ones which receive the most sunshine, although that would seem to be an obvious advantage in the generation of solar power. The states where solar power has been adopted most enthusiastically are those where lawmakers have glimpsed the future and determined that renewable energy sources must be embraced before non-renewable supplies are exhausted.
State legislatures that enact policies friendly to solar power are crucial in making it easier for residents and small business owners to convert to a system where electricity is generated from solar energy. Here are some of the ways that lawmakers have greatly aided in the movement toward going solar.
Renewables Portfolio Standard
Many states have a Renewables Portfolio Standard (RPS), which in effect, is a roadmap for the greater usage of renewable energy sources like solar power. This policy mandates that a specific percentage of all electricity generated within the state come from renewable sources by a specific date. For instance, a moderately aggressive RPS would call for perhaps 20% of all electricity to come from renewables by the year 2020.
It then becomes incumbent upon the state’s utility companies to carry out this mandate. That forces them to help residents install solar systems, either through leasing arrangements or through outright purchases, in order to achieve their own required level of compliance. Utility companies may not like it, because solar electricity is always cheaper, but they literally have no choice in the matter.
Not all states have income tax so not all of them can offer tax credits, but for those states which do have an income tax, one great way to help recover the cost of installing a solar panel system is to allow a tax credit in the following year. Many states and counties have adopted this program and allowed homeowners to recover a percentage of setup costs by providing them with tax credits in amounts varying from a few hundred dollars to several thousand.
Rebates are generally offered by the utility companies to encourage homeowners and small businesses to install solar panel systems. It helps the utility company achieve compliance with the state’s RPS, and ensures future involvement in the renewable energy movement. Homeowners can recover between 10% and 40% of installation costs, depending on the state and the size of the system being installed.
Another way utility companies can achieve compliance with the RPS described above is to purchase a homeowner’s energy credits, which typically are earned by the homeowner just for generating more than 1 KW of solar power in a year. A typical 5 KW solar panel system generates about 6 Energy Credits per year, and if a utility company purchases these from a homeowner, it is considered the same as if the utility company itself generated the power, thus achieving compliance.
Performance credits are great for the homeowner because they can actually earn money just for generating and using their own solar power – they are paid for using solar energy in their homes.
Choose your State
- New Hampshire
- New Jersey
- New York
- South Carolina