Let it Snow: Solar and Winter Weather
Let it Snow: Solar and Winter Weather
By: Rachel Gentile
As a Massachusetts-based solar provider, questions about how changing weather and cold winters affect solar production, are above and beyond the most common item we hear from clients. In fact, we get questions about weather-related issues almost as much as people from the Northeast complain about the weather! Now that the days are getting shorter and growing ever more chilly, we want to take some time to answer these recurrent and important questions about how winter weather impacts your solar system and explain how we use past data to account for changing weather in our analysis process.
Seasons:
Every Northeasterner knows that the cold is approaching when the sun starts setting earlier, since the further north you live, the shorter your days are in the winter. Summer is the best season for solar production because the days are longer, meaning that solar panels are working for more hours of the day than they do in fall, winter and spring. Though the cooler months have fewer daylight hours, they make up for some of this loss with greater production efficiency, thanks to the impact of temperature on output.
Solar power generation varies seasonally, with the highest production occurring in the summer months when daylight hours are longer.
Temperature:
Photovoltaic (PV) solar harnesses energy from the light of the sun—not the heat—meaning energy is produced even in the bitter-cold Northeastern winters. Temperature does not affect the amount of energy the solar panels receive, but the panels are more efficient at converting that energy into electricity when it’s cold out and they are less likely to surpass their peak operating temperature.
Electricity is produced when light hits the panel and the electrons in the panel move from a “resting” state to an “excited” state. When the panels are cold, there is a greater difference in energy between the excited state and the resting state, which allows the panels to convert the energy into electricity more efficiently.
Panels are typically tested at 77°F, which means that when the temperature is higher, the panels will be less efficient and if the temperature is lower, the efficiency will be greater. Much like your car heats up when it’s parked in the sun, solar panels can get very warm throughout the day, but if the air is cold, it can cool the panels and increase efficiency. Therefore, the best days for solar panel efficiency are cold, sunny days like we typically see in late fall and early spring
For good record, unless you plow your roof, you don’t need to clear your solar panels!
Snow:
A light dusting of snow does not significantly prevent light from reaching the panels. As more snow starts to accumulate and cover the panels, it can prevent electricity production until the snow melts or slides off. Luckily, if even part of a panel is exposed, it can still produce electricity.
It may sound counterintuitive, but snow can actually be good for solar production. When the snow melts or slides off, it carries away any dust or dirt that may have accumulated on the panels. Clean panels produce more electricity than dirty ones, so the occasional rain or snowstorm is a good thing. Sometimes when snow slides off of sloped arrays, it all slides off in one large sheet so don’t be alarmed if you hear a loud crash after a snowfall—it’s just mother nature cleaning.
Rain/Clouds:
As we’ve already discussed, the best weather for solar panels is clear, sunny skies and cooler air, however, solar will still produce energy on rainy or cloudy days. On very cloudy days, panels produce anywhere between 10-25% of the energy that they would on a sunny day. The water droplets in clouds and rain scatter light, meaning that less energy reaches the panels and can be converted into electricity. Though we wish every day was bright and sunny, we know that weather varies in the Northeast and the occasional cloudy day won’t hurt your solar production in the long run.
Weather in our region may feel unpredictable, but when we create the production estimates that go into our project proposals, we put a lot of thought into making them as accurate as possible. Our software utilizes a dataset with 25 years of local weather data to predict how much energy your system will produce each year so you can feel confident in your investment. There are many variables that contribute to the amount of energy your solar panels will produce but regardless of your day-to-day production, solar is a long-term investment that will provide value for years to come.
Resonant Energy 2021 Massachusetts Climate Bill Summary
By: Isaac Baker, Ben Underwood, Ed Cabell, and Matt Connolly
Updated 4/15/21
On March 26, 2021, after significant back and forth within the legislature and a narrow miss in the prior session, Governor Baker signed the state's newest sweeping climate bill into law (full language available here). Many have hailed this bill as the most significant piece of climate legislation since the Global Warming Solutions Act signed by former Governor Patrick in 2008, and as with any piece of major legislation, there’s a lot in there.
This post is intended to summarize the key provisions that will impact Resonant Energy and our community’s areas of focus: environmental justice and equitable solar PV deployment for nonprofits, affordable multifamily, and low-income households. For other resources, you can check out the State’s Press Release, the WBUR Bill Summary, and two deep dives on solar net metering and solar tax treatment written by our colleagues at Klavens Law Group.
Section 13 Overview - Clean Energy Equity Workforce & Market Development Program
Under this new groundbreaking initiative, the Dept of Public Utilities will provide $12 million annually to fund a new set of programming aimed at broadening employment opportunities in the rapidly growing green economy. Target sectors include energy efficiency, clean energy, and clean heating and cooling (think air source heat pumps). The programming will include “workforce training, educational and professional development, job placement, startup opportunities and grants” to women and minority owned businesses, residents in environmental justice communities, and former fossil fuel industry workers.
In addition to tackling the critical jobs side of the work, this section also calls for the program to identify market barriers to the deployment of clean energy and energy efficiency technologies in environmental justice communities and to award incentives to make such installations possible to help these communities keep pace with the statewide greenhouse gas reduction targets.
$12M a year is just the beginning of what it will take to solve all of the challenges associated with the equitable distribution of jobs and consumer benefits created by MA’s growing clean energy economy. But this is a big deal and establishes an important precedent that advocates can build on in the coming years.
(Lines 193-196; page 11)
Section 31 Overview: Commercial PACE Program Updates
This section tweaks language governing MA’s Property Assessed Clean Energy (PACE) Program, which went into effect on July 28, 2020. The PACE Program is a financing mechanism for commercial buildings looking to take on renewable energy and energy efficiency improvement projects. It is run by MassDevelopment and the MA Department of Energy Resources that allows commercial building owners and nonprofits to take out loans for clean energy and efficiency improvements that go out to 20 year terms at what we anticipate will be a 5-6% interest rate (based on C-PACE programs in neighboring states). According to the agency overseeing the program, it typically makes the most sense for projects that cost $250,000 or more.
This innovative loan program allows cities and towns to guarantee the loans, enabling lenders to work with smaller and less traditionally creditworthy borrowers while also going out to longer loan terms that are often required for these types of improvements to make sense. One of the few requirements is for the project to produce more in savings over the length of the loan than the initial cost of the project. The PACE program is currently available for financing in 41 cities and towns across the Commonwealth. For a full list of PACE-eligible municipalities and more information on the Program, see MassDevelopment’s website. As of April 2021, no projects have yet been funded, but we expect this program to grow significantly in the coming years.
(Lines 301-315; pages 15-16)
Section 54 Overview: Low-Income Services Solar Grant Program Established
This provision creates a fund of $500,000 per year to make grants of up to $50k a piece for solar installations on nonprofits that offer services such as food security, homelessness, and emergency shelter. 100% of these solar systems’ energy output must benefit the host nonprofit and at least 10 grants will be issued each year.
As of April 2021, we do not know yet which agency will be responsible for this grant program or when it will begin accepting applications. We are following up with the Dept of Energy Resources and the MA Clean Energy Center on this and will post more details as they become available. Any qualifying nonprofit organization interested in the program should reach out to Ed Cabell (Ed[at]resonant.energy) for more information on how to be best positioned to apply for these funds when the program goes live.
(Lines 626-646, pages 31-32)
Section 10 & 56 Overview: Writing Environmental Justice into Law
An important first step in creating equitable policy is to define communities that have been most harmed by economic exclusion (ex. WGBH coverage of Boston’s redlining) and fossil fuel-powered industries (exemplified by MA’s 16 active trash incinerator plants, covered here by the Conservation Law Foundation). This section does just that and defines the communities that require the additional focus of resources and protection from further harm as “Environmental Justice Populations,” namely census block groups that meet the following criteria:
Annual Median Household Income (AMHI) is not more than 65% of statewide AMHI
Minorities comprise 40% of the population
25% or more of household lack English language proficiency
Minorities comprise 25% or more of the population and the AMHI of the municipality in which the neighborhood is located does not exceed 150% of the statewide AMHI
This definition comes with a set of “Environmental Justice Principles'' that aim to fairly distribute the negative impacts of industry and infrastructure, among other provisions. Section 10 earlier in the document also requires that the roadmap to reducing greenhouse gas emission be created “in a manner that protects low- and moderate-income persons and environmental justice populations.”
While again there is more work to do at the state level to direct funding to environmental justice communities, and it is not yet clear how in reality the next natural gas compressor station or incinerator plant will be equitably cited in an affluent Boston suburb instead of a gateway city, this addition to our laws is an important step toward achieving greater equity in the Commonwealth as we move toward a future with fewer polluting industries and more clean infrastructure.
Section 56 (Lines 650-693; pages 32-34)
Section 10: Subsection 6: (Lines 182-186; page 10)
Section 60 & 62L Overview: Creating an Environmental Justice Council
This section creates an Environmental Justice Council to keep the Office of Energy and Environmental Affairs accountable to the environmental justice principles. The council will consist of 9 - 15 members appointed by the Governor, who will serve without compensation. The environmental justice council will periodically conduct reviews to ensure that the definition of environmental justice population is achieving the intended objectives, and may suggest updates to the EJ definitions as needed.
While this is again an excellent step forward, a better policy would have compensated council members to ensure participation is feasible for candidates with limited resources and could have had a more democratic means of appointing candidates.
(Lines 773-797; pages 38-39)
Section 61 & 98 Overview: Clarifications on How Solar PV Systems Should be Taxed
Like many states, MA has had a property tax exemption for solar as one of the many ways it has tried to boost the solar adoption. As the industry has grown, there is increasing interest from cities and towns in taxing the largest of these systems, especially large commercial arrays installed on greenfields, while avoiding taxing smaller systems like an array on a residence or a house of worship.
To that end, this section states that a solar PV system, owned or leased, shall have a 20-year exemption from municipal property taxes if it:
is capable of producing not more than 125% of the annual electricity needs of the real property upon which it is located, including both contiguous or non-contiguous real property within the same municipality in which there is a common ownership interest (relevant for organizations with many buildings in the same town), or
is less than or equal to 25 kilowatts in capacity; may or may not be co-located with energy storage (we assume 25 kW-AC as the verification is via the system rating in the utility’s permission to operate letter. Relevant for residential and small commercial.)
has executed a PILOT agreement with the host municipality (provides assurance to developers of larger solar arrays who already negotiated a custom PILOT for a past project that this policy won’t impact them)
per Section 98 of the bill, systems determined to be exempt prior to the effective date of this act that have not executed a PILOT agreement with the host municipality shall remain exempt so long as the system produces less than 150 per cent of the annual electricity needs of the real property on which it is located (additional flexibility for previously exempt systems)
In summary, this policy upholds favorable tax treatment for many of the smaller systems we work on and all behind the meter systems designed to offset onsite usage up to the 125% limit. It also formally includes solar systems that serve nonprofit organizations, which previously had been a grey area in MA tax policy. This change is anticipated to go into effect on June 24, 2021 (90 days from when the bill was signed into law).
61: (Lines 798-827; pages 39-40)
98: (Lines 1076-1081; page 52)
Section 77 Overview: Utility-Owned Solar + Storage in Climate Vulnerable Communities
Municipalities at high risk from climate change can invite electric distribution companies (that is, utility companies, or EDCs) to submit petitions to DPU to allow the EDCs to build, own and operate solar and/or storage assets on land owned within the municipality at no cost to the municipality. These projects are eligible for cost recovery from all electricity ratepayers in the state, subject to DPU approval. They are also exempt from the legal limit on EDC-owned solar capacity, so long as total EDC-owned capacity does not exceed 10% of the total installed capacity of solar generation facilities in the commonwealth as of July 31, 2020. Projects must meet program goals “including but not limited to, job creation, peak demand reduction and system resiliency.” Municipalities with environmental justice populations shall receive a preference for participation in such projects.
An eligible municipality is defined as “a city or town that can demonstrate to the department current or future changes to its population, land use or local economy resulting from changes in climate”
This change is a win for utilities, who are always in favor of being allowed to own and rate base more infrastructure. It could also be a win for communities on the Cape who are likely to be first in line here to add utility-scale solar + storage systems to reduce the impact of outages that will become more frequent in the coming years. That said, although EJ communities are given precedence for participating in the program, the legislation does not set any clear provisions for how projects will directly benefit residents of the communities in question, nor does it set any threshold for the amount of benefit that must go to residents.
(Lines 891-939; pages 43-45)
Section 84 Overview: Net Metering Credit Transfer Rule Change
While previously net metering credits for excess generation in a given month at a site could only be transferred within a given utility load zone (see our load zone map here), this statute now allows credits to be transferred to other accounts of any distribution company located in the Commonwealth.
The primary beneficiaries of this policy is likely to be larger community solar facilities in western MA looking to transfer credits to customers in the more populous eastern part of the state, as the market out west is already fairly saturated. So, for example, this change would allow a resident of Boston to purchase discounted solar net metering credits from solar farms located on agricultural land near Greenfield.
As noted by our colleagues at Klavens Law group, this change is still subject to the Dept of Public Utility’s implementation timeline, which is as yet unknown, but is likely to be at least 9-12 months out.
(Lines 970-974; page 47)
Section 85 Overview: Net Metering Facility Qualification Change
This provision eliminates net metering caps for Class II and Class III net metering facilities that serve on site load; any credits accrued in excess of its annual electricity consumption for the period running from April through the following March shall be credited or paid out for such excess credits at the utility’s avoided cost rate (which is expected to be 3-6 cents/kWh). This means onsite solar systems that are greater than 60 kW+ AC and sized to the building’s usage will get full retail net metering credit value based on the meter’s rate class, but will come with the caveat that any excess calculated over the course of a year will be sold off at a very unfavorable rate. This will incentivize developers to size conservatively to ~90% of usage to avoid this outcome.
Overall, this is a big win for larger onsite solar projects in National Grid and Eversource West where net metering has not been available for the past few years. The implementation timeline is anticipated to be the same as Section 84.
(Lines 975-984; pages 47-48)
Section 94 Overview: Guidance for Future Solar Incentive Program Design
According to this section, any new solar incentive program developed by the DOER shall to the greatest extent feasible:
Provide equitable access to all Massachusetts ratepayers, including low-income ratepayers
Address solar energy access and affordability for low-income communities
Include effective consumer protection provisions
Ensure that information about the program and its benefits are provided in a readily accessible manner to all ratepayers, including non-English speaking communities
DOER shall consult with diverse range of stakeholders to inform the design of any such solar incentive program, including low-income ratepayers and organizations representing their interests
This is an important next step to ensuring that we don’t let another incentive program go by without meaningfully addressing the barriers to clean energy adoption in underinvested communities. This will be a key opportunity for our colleagues to intervene in the regulatory process to ensure that the successor to the SMART program goes much further in incentivizing and achieving equitable solar deployment in the Commonwealth.
(Lines 1035-1045, page 50)
Solar Panel End of Life & Recyclability
By: Macy Zander
A question we often get from those curious about reducing their building’s carbon footprint is about solar panel recyclability. Solar energy itself is undoubtedly an environmental win, but what happens once a panel reaches its end of life?
Before we can address panel recyclability, it's important to understand the lifespan of solar PV. All the panels we use have a production warranty of twenty five years, with the average panel’s expected lifespan hoovering at thirty years. Once past the production warranty period, a panel’s production output stands at approximately 80%, meaning that by no means does a panel need to be removed once it hits 25 or even 30 years old. However, once you decide it's time to retire your array it’s important to do so in a responsible way; fortunately there is strong indication that the systems and regulations needed to ensure circularity of solar PV will only expand in the coming years.
At a high level solar panels are technically recyclable, however they first have to be broken down into their basic components, which can be a complex process. Solar panels have traditionally been recycled at general purpose glass recycling facilities, where the metal frames and glass parts are salvaged, but the remaining parts are disposed of or burned. Silicon can also be recovered, although it is not presently as cost effective as utilizing raw material. At the moment recyclers focused on solar PV find themselves constrained by the lack of supply of retired panels, however all signs point that as the market continues to grow, recycling will have an important part to play in the industry.
A 2016 study by the International Renewable Agency (IRENA) estimated that $15 billion could be recovered from recycling solar modules by the year 2050. While the market to recycle panels is fairly small right now, the financial incentive to recycle is anticipated to only increase in sync with the growth of the industry. Today the American solar recycling industry is nascent, but growing. There are promising developments emerging from recycling companies, panel manufacturers, and industry groups to get ahead of the problem before the first mainstream wave of PV, which leaped in popularity in the 2010s, reach their end of life.
From a regulatory perspective, we're already seeing momentum on this topic from the Washington State House and Senate that passed a bill in Spring 2020 that will update the State’s solar recycling policy. This bill will inform the final design and adoption of a comprehensive solar recycling program that is data-driven and considers the lifespan of modules. The California industry is actively working to expand regulations to ease the recycling process. The EU also has regulations in place through the Waste Electrical and Electronic Equipment (WEEE) Directive to make sure solar panels are recycled at their end of life. If these areas can be seen as first movers, it seems reasonable to expect other states will follow suit eventually. At the moment in the Northeast recycling options are limited, but based on trends it is almost inevitable that will not be the case in the next decade, let alone in the next three decades.
We're having an office warming party!
Since its birth three years ago, Resonant Energy has grown as a company, tackling bigger and more complicated solar projects with a diverse and ever-growing team. Now we need a new office to match. We are excited to announce we have moved from our cozy nook in Second Church, located in Dorchester’s Codman Square, to a sunny, new space in Fields Corner located at 60 Clayton St. Suite #201 Dorchester, MA 02122.
We are full of gratitude for the many exceptional leaders of Second Church and the entire Codman Square community for welcoming us and providing a space for Resonant to grow. The entire Codman Square community has and always will have a special place in our company’s heart, and we are grateful for the supportive community that has shared our vision for just and equitable clean energy. We want to open up our new space to pursue solar installations and clean energy projects that serve all communities across Massachusetts and New York, as well as continuing to recruit new team members to continue Resonant’s goal of expanding clean energy.
To celebrate this milestone, the Resonant team will be hosting an office warming party, and we would love to celebrate with our friends, partners, supporters, and everyone in the climate fight with us! We will have food and drinks, games, music, and the entire Resonant company! Come by 60 Clayton in Fields Corner September 5th from 6 to 8 pm. Please RSVP here.
RSVP on Eventbrite and Facebook!
Eventbrite: https://www.eventbrite.com/e/resonant-energy-office-warming-party-tickets-67931285303
Facebook: https://www.facebook.com/events/2101655110138171/
Cordially,
The Resonant Energy Team
The Effect of Solar Panels on Property Values
Interested in installing solar but unsure of how it will affect the resale value of your property? Every year, more and more people install solar panels in their homes, businesses, and community centers, and new research finds yet more reasons to invest in solar while you can. New findings show that buildings with solar panels have increased in property value by 4% on average, with cities like Austin, San Francisco, and New York City seeing property value increases as high as 6%. For a property that cost $800,000 that’s nearly a $50,000 increase in resale value for a solar array that probably cost half that. Real estate agents are finding that not a single building in the metropolitan United States has lost value as a result of installing solar panels, and homes with solar have been found to spend as much as half as much time on the market compared to non-solar homes. Solar installations, it seems, can only increase your home’s property values. These findings have been reported and independently confirmed by institutions like the US Department of Energy, the Appraisers Institute, Fannie Mae, and Ohio State University, and they all agree that solar can only help your property’s value. Home buyers are even willing to spend more on a solar home by as much as $4 a watt!
So, what’s leading to the increased valuation of solar in the American real estate market? These groundbreaking findings are likely due to support from states like Massachusetts and New York, who incentivise green energy. Massachusetts, for example, offers generous incentives to help property owners see a quick return on investment, and Massachusetts, New York, and California all exclude solar panels as an amenity from state property taxes. This is further proof that solar is a prudent investment that pays for itself in no-time, and those looking to sell their homes in the next few years should strongly consider solar as a must-have amenity to fetch the highest possible value on their property. Because of solar’s aesthetic, commercial, and environmental appeal, millions of Americans have already installed solar in their homes, but the window for such great deals is closing fast. New solar systems will no-longer qualify for Massachusetts’ solar incentives at the end of 2019, so act fast if you are one of the many New Englanders interested in green energy, and take advantage of these deals while you can!
Fortunately, Resonant Energy is here to help meet your solar needs before the sun sets on these incentive programs. Resonant Energy is New England’s leading solar provider for non-profits, and we specialize in making affordable solar available for non-profits, houses of worship, and everywhere in our communities. We help you every step of the way, from initial project proposals to installation and flipping the ‘on’ switch, and we offer diverse financing options for every budget. If you are interested in maximizing the value of your home with solar panels, find us at http://www.resonant.energy/ and reach out for a free quote before time runs out!
Bibliography
Begley, Jaclene. “Exploring the Influence of Solar Panels on Housing Values.” Fannie Mae, Dec. 2018, p. 11.
“Do Solar Panels Increase or Decrease Home Value?” Direct Energy, 16 Mar. 2016, https://www.directenergy.com/blog/solar-panels-help-hurt-resale-value-home/.
Gassett, Bill. “Understanding Solar Power When Selling or Buying a Home.” Massachusetts Real Estate Exposure, 15 Aug. 2016, https://www.maxrealestateexposure.com/solar-power-selling-buying-home/.
Grenvik, John. “Do Solar Panels Increase Home Value?” Wholesale Solar Blog, 27 Apr. 2018, https://www.wholesalesolar.com/blog/do-solar-panels-increase-home-value/.
Lower, Edited by Brian H., et al. “5.3 The Effect of Solar Photovoltaic Panels on Residential Sale Price.” Environmental ScienceBites Volume 2, The Ohio State University. ohiostate.pressbooks.pub, https://ohiostate.pressbooks.pub/sciencebitesvolume2/chapter/5-3-the-effect-of-solar-photovoltaic-panels-on-residential-sale-price/. Accessed 10 July 2019.
Mishkin, Shaina. “Here’s How Much Adding Solar Panels Will Boost Your Home’s Value.” Money, http://money.com/money/5642057/home-value-solar-panels/. Accessed 9 July 2019.
Prevost, Lisa. “Appraising Solar Energy’s Value.” The New York Times, 20 Feb. 2015. NYTimes.com, https://www.nytimes.com/2015/02/22/realestate/solar-panels-and-home-values.html.
“Solar Homes Sell for a Premium.” Energy.Gov, https://www.energy.gov/eere/solar/downloads/solar-homes-sell-premium. Accessed 9 July 2019.
Solar Panels Increase Home & Property Value | EnergySage. https://www.energysage.com/solar/why-go-solar/increased-property-values/. Accessed 9 July 2019.
Youngren, Marjorie. “Ask the Realtor: How Do Solar Panels Affect a Home’s Resale Value? - Ask the Expert, Buying.” Boston.Com Real Estate, 25 Oct. 2017, http://realestate.boston.com/buying/2017/10/25/ask-realtor-solar-panels-affect-homes-resale-value/.
SMART Program Extends to Municipal Light Districts
At the end of May 2019, the Dept. of Energy Resources (DOER) announced an agreement to incentivize projects in municipal light plant geographies under the SMART program. The incentives are different based on the amount of funding pledged by each municipality with total funding announced here for each. The program will incentivize projects by buying down roughly 1/3 of the project cost with a $1.20/w upfront incentive for projects < 25 kW-DC, which covers the typical size for households, nonprofits and small businesses. This program operates on a first come first serve basis so anyone considering a project in a municipal light plant should reach out here as soon as possible!
Federal Solar Tax Credit to Begin Sunset
By: Isaac Baker
UPDATE - MAY 23, 2019. Bipartisan group of senators start to look at proposing longer term extensions to clean energy tax credits, including the investment tax credit for solar, which will be a top priority in the coming months.
—————————————————————————————————————
Business owners, nonprofits and homeowners are moving quickly to take advantage of one of the most lucrative clean energy policies, the Solar Investment Tax Credit, on track to step down in 2020.
This article covers that lucrative policy — the 30% federal tax credit — which has been the most important driver for the economics of solar PV technology in the U.S. since it was enacted in 2006. The first thing to know is that there are two tax credits provisions for solar PV in the tax code: the Business Energy Investment Tax Credit (IRC Section 48) for businesses and nonprofits and the Investment Tax Credit (IRC Section 25D) for residential installations. Both policies provide a credit valued at 30% of the total installed cost of the system (including equipment, labor, overhead, etc.) to the owner of the system.
This policy has even helped countless nonprofits and businesses who either don’t pay federal taxes or don’t have tax liability, but are able to see meaningful savings by “selling” the tax credit on a market that has formed around this policy. Through Resonant Energy’s Hybrid Ownership Program, your organization can exchange the tax credit for a discount on the total solar array cost.
In 2015, the tax credits for solar were set to expire and Congress passed an omnibus energy bill that extended the tax credit for both solar and wind (while also opening up public lands for oil exploration as the compromise). This extension came with a built-in sunset, on the eve of which we now stand in 2019. The full schedule for non-residential projects will be a step down from 30% to 26% in 2020, 22% in 2021, and 10% in 2022, where the credit will rest until policy makers go back to the negotiating table. Residential projects will follow the same schedule, except the credit will go to 0% in 2022 (Fig 1).
Fig 1: Schedule for phase out of Federal ITC. Credit: SEIA.
As this schedule steps down, one of the key questions for projects is how you secure your place in one year or the next. The IRS has issued a ruling (Notice 2018-59) determining that the project owner must have spent at least 5% of the cost of the project in order to secure the value attributable to a given tax year (this ruling is known as the “safe harbor” provision). This can most easily be demonstrated by signing an agreement in 2019 and making at least one milestone payment towards your project to ensure that you can claim the full 30% tax credit value — even if the system is not ultimately placed in service until 2020.
As you consider your options, Resonant Energy is here to help you navigate the solar process with detailed design support, competitive bidding, and policy knowledge and ensure that you get an optimal financial outcome with your system. Learn more about our projects here and let us know when you’re ready to take the next step for your organization.
ITC FAQs:
How did the tax credit originally get passed?
The solar tax credit was first passed with the passage of the Energy Policy Act of 2005 (under the George W. Bush administration). The tax incentive was extended from its original end date just a few years later in 2008 as part of the Emergency Economic Stabilization Act of 2008, often referred to as “TARP” funding, named after the section called the Troubled Assets Relief Program. This policy extended the credit through 2016, at which point it was once again extended with its full 30% value through 2020, as noted in the article above.
Can the tax credit carry forward if I don’t use it all in one year?
Yes, the tax credit can carry forward, meaning that if your organization does not have sufficient tax liability to use up the credit in the first year you can claim the difference on the following year’s tax return (and so on). However, there is no specific guidance as to the treatment of unclaimed credits once the ITC fully sunsets, which may be as soon as 2022. While you may be able to roll your credits over beyond that, it is best to be conservative and to ensure you can use your tax credit value by 2022.
How do I file for the tax credit?
Residential: Complete IRS Form 5965 to demonstrate the amount of qualifying solar expenditure you’ve made
Add your renewable energy credit information to your typical form 1040
When does the tax credit get “generated”?
You are eligible for your solar tax credit as soon as your array is “placed in service.” This means that system must have received all necessary permission from local inspectors and the utility. The utility grants you “Permission to Operate” (PTO) after its inspection, after which point you can turn on the array. This is the date from which you can claim your credit. For example, if you sign a contract in December 2019 but the system isn’t operational until February 2020, you must claim the tax credit in your 2020 return.
Note: Resonant Energy strives to provide clients with top-tier guidance on solar PV. However, we are not tax specialists and what we have written should not take the place of advice from a tax professional. We recommend that you consult your advisor before taking the next step on solar to ensure that these policies work for your organization.
Dorchester Coalition Celebrates Completion of Solar Access Campaign
Elnora, Dorchester resident and solar participant, speaks at the Sun for All Celebration in Codman Square Park.
September 16, 2017
BOSTON— Resonant Energy hosted the Sun For All Celebration in Codman Square on Saturday September 16th with Social Saturdays, marking the close of the first low-income accessible solar campaign in Dorchester. Four months ago, Resonant Energy launched Codman Square Goes Solar in partnership with the Codman Square Neighborhood Development Corporation, the Second Church in Dorchester, Co-op Power, Epiphany School, the Dorchester YMCA, and the Codman Square Neighborhood Council. By the end of the summer, the campaign signed up 35 households a 5 nonprofits to install rooftop solar systems. Using Resonant Energy’s new solar hosting model, this campaign was the first of its kind to include households and nonprofits regardless of income or credit history.
“It was great to be part of a group that just kept pressing our way and believing that our community deserves the same access to clean and affordable energy as any other community,” said keynote speaker Rev. Mariama White-Hammond, the Minister of Ecological Justice at Bethel A.M.E. “I’m excited not just because of what we’ve done in the past year but because of how this is growing.”
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Read the full press release here.
Three Boston Congregations Team Up for Community Solar Project
Reverend Mariama White-Hammond, a Class of 2009 Barr Fellow, shares three lessons and a new video documenting a novel collaboration of three churches committed to action on climate change and equity.
Three Boston congregations recently joined forces to put solar panels on their rooftops, capable of producing 70 kilowatts of clean energy to power our congregations. This is equivalent to the amount of electricity required to power about eight homes. Just as the project was getting started, cuts to the state solar compensation program almost killed the project, but we persevered through anyway.
I’m incredibly proud of Second Church (Dorchester), the Church of St. Augustine and St. Martin (South End), and Bethel AME Church (Jamaica Plain), and the staff at Resonant Energy, for our collective hard work and determination to make this project possible.
As people of faith we are asking the question: how can we be stewards of the earth and tackle urgent problems like climate change while also addressing equity issues? Solar on our churches is one great way to start. Our congregation has already invested in exploring how to reduce our impact on the planet in many ways, including water conservation, recycling, and energy efficiency. We saw playing a leadership role in solar energy as another way to walk the talk.
As people of faith we are asking the question: how can we be stewards of the earth and tackle urgent problems like climate change while also addressing equity issues? Solar on our churches is one great way to start.
In addition to producing clean energy, a solar installation has many other benefits: it shows us how solar works, lets our community members and our leaders experience it, and illustrates how clean energy can provide additional benefits to our community, like good jobs. This is why we chose solar installers based on their track record of hiring people of color, including someone who lives right in our church’s neighborhood. I’m excited to share this video that we produced to document the project:
In reflecting on the project, which took about 15 months, we learned many things. Here are my three main takeaways from the project:
First, we must take leadership. Our project allows our churches to demonstrate how to contribute to reducing pollution, increasing resilience, and bringing economic benefits to our communities. We learned lessons that we can share with other churches and institutions that want to contribute to clean energy solutions and produce local energy. We are also helping our congregations to think more about the impact that our energy use has on the planet—and on people. We also thought a lot about how local projects like this one catalyze excitement and a sense of ownership, demonstrating what we can do when we work together collectively. People are so proud of our leadership role.
Similarly, it is important to provide tangible local examples for everyone in our community to see that what is possible. Local projects can catalyze excitement and a sense of ownership. Addressing climate change can seem like an overwhelming task for an individual or a congregation, and many people think that small actions don’t make a difference—but I firmly believe that they do. We must have examples in our communities—all of them—to show that clean energy is readily available, affordable, and accessible. We need more churches, businesses, institutions, public agencies, and others to use their buying power to show that this is possible.
Third, the “just transition” to clean energy must be a priority for everyone working to address climate change. To rapidly deploy the amount of clean energy that is needed to meet our climate goals, we must work together to ensure that all members of our community can share in the benefits of clean energy. It is my view that when we are working on clean energy policies and projects, we must be truly inclusive and make sure that communities are driving progress together. And we must understand that climate progress without good jobs, safe housing, and access to health care leaves many people out.
I’m a climate activist. I recognize that putting up solar panels on a few churches is just one step; we have many, many more to go. But this project allows people to see that each of us can be—and must be—part of the green revolution, for our planet and for our neighbors.
This project allows people to see that each of us can be—and must be—part of the green revolution, for our planet and for our neighbors.
Next, we’re going to:
- Help our members learn more about what they can do to reduce their energy use and invest in renewable energy to keep our momentum going.
- Share the video with other congregations to encourage them to go solar. We shared it in March for a gathering of 23 congregations and we are scheduled to share with other local and national faith gatherings this year.
- Seek solutions for more challenging questions like: how can we get the solar revolution to reach renters and low-income communities? How do we get more solar panels in our community on other buildings?
- Educate policymakers and local leaders. We have joined with other congregations and nonprofits to support policies that provide strong incentives for low-income shared solar. We are proud that state Representative Russell Holmes and state Senator Chang-Díaz (each has one of our churches in his or her district) are stepping forward to lead on these issues.
As my friend Alphonse Knight of Second Church in Dorchester said, “the Church is the foundation of the community; it’s where people grow and develop values. When something positive happens here, everyone in the community sees it. Now, we can see the church’s commitment to stewardship right here on our roof.”
As faith leaders, we will keep working to ensure that everyone benefits from the green revolution—especially those who are hit hardest by climate change while contributing least to the problem. We hope that you will join us.
Reverend Mariama White-Hammond is a Barr Fellow (2009) and recently started a fellowship with the Green Justice Coalition, a Barr grantee. Her current fellowship focuses on organizing communities of faith, particularly black churches, to engage on climate issues.
Church Solar Project Inspires Solar for Neighborhood
May 2, 2017 - Sami Grover
One of the things that has always interested me about solar—and other clean tech—is the potential for them to become contagious. While few of us have the power, or the inclination, to build a coal plant just because the neighbors down the road have one, the distributed nature of solar means that one installation can lead to many more as neighbors get inspired by what other neighbors are doing.
There's still one impediment to this though. And that's money. Despite rapid declines in the cost of solar power, upfront costs can be prohibitive for many—even if there are long-term savings to be had.
Enter Resonant Energy. Based in Boston, this social enterprise is working on building coalitions of community partners to plan, finance and install solar projects. One of its flagship efforts—a successful Interfaith Community Solar Campaign—has already brought solar to Second Church in Dorchester, Bethel A.M.E., and the Church of Saint Augustine and Saint Martin. Because upfront costs are covered by the project, churches start saving from day one.
Now, that project is inspiring Codman Square Goes Solar, a neighborhood-wide effort which will see residents sign up to host solar on their rooftops at no cost to them. The effort has caught the attention of the mayor, winning the Buildings and Energy category of the city's Greenovate Awards, and is now aiming to install solar on 25 private homes in the surrounding neighborhood, three small commercial businesses, and three more houses of worship too.
It's exciting stuff. Much like Re-Volv's community solar seed fund, or solar barn raisings and voluntary gas taxes, I suspect we'll see many more community-based solar efforts like this as solar costs continue to fall.