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2012 – 2013 continues the very popular residential Solar Federal Tax Credit first enacted in 2009.  The previous solar tax credit program was capped at $2,000.  With the new one one, you can claim up to 30% of solar power costs for a new solar electric system. Existing homes & new construction qualify. Both principal residences and second homes qualify. Rentals do not qualify. Expires: December 31, 2016

The Solar Federal Tax Credit 2012 – 2013 works especially well when coupled with a state rebate program. (CA, CT, NJ, NY) Also look for city solar incentive programs, that can also save you money on your solar panels.

On the tax credit, existing homes & new construction qualify. Both principal residences and second homes qualify. Rentals do not qualify.

This 2013 Solar Federal Tax Credit reduces the amount of tax you owe. The credit is a reduction of total income tax at the bottom of your tax return. This tax credit is a non-refundable tax credit. Consult your tax adviser for details about solar power. Use it or lose it!

California Solar Power Rebates

In the Spring of 2013, most of California ran out of money for their solar rebates. Southern California Edison still had some rebate funds available.

Rebates make solar power worthwhile in California as well as several other states. Without hefty rebates, few systems would be sold. California Solar Initiative Rebates vary according to system size, customer class, and performance and installation factors. The subsidies automatically decline in “steps” based on the volume of solar megawatts confirmed within each utility service territory.

Be sure to check this website tracker page to see where rebate amounts are currently at. The rebates are clearly approaching a lower level in the near future. If you are interested in the solar system and reside within the service area, it is time to start moving your project forward.

Example Solar Electric System cost with Rebates

A 5kW solar electric system costing $24K would get $6K in a California Utility rebate and $7.2k Federal Solar Tax Credit. First year system net cost $10.8k. System pricing is always changing, usually downwards.

The estimated annual electricity cost before you installed a solar system would be approximately $1700, the price with your solar electric system installed would drop to $400.

System payback time would be roughly 11 years.  Rebates vary depending on location of course. Rebates make solar power Very attractive! The estimated life span of most solar electric systems is from 20 – 30 years, so after your system payback time, your system has already paid for itself.

The payback time in New York, with its state and local tax credits is even shorter. The payback time in Minnesota and Oregon is slightly longer than California.

San Francisco Solar Rebates

The city of San Francisco recently started GreenFinanceSF, a financing program that helps to pay for water savings, energy efficiency, and renewable energy projects that you might not have been able to afford.  The repayment obligation is attached to the property, rather than the individual, and is paid back through property taxes over the life of the financing. The maximum payback is 20 years. this program applies to residential and commercial property owners.

Eligible projects include home energy audits, upgrading heating systems, upgrading water heaters, installing solar hot water, installing solar electric panels, and conserving hot water. The city wants people to get home energy audits before doing any work, so you see all the options. The program has an online application and application processing fee of $300. FAQ 800-803-6930 is their phone number.

If you sell the property before everything is paid back, whoever buys the property will make the rest of payments over time through their property tax bill.

This program was funded in part Through the American Recovery and Reinvestment Act of 2009 (ARRA). The City and County of San Francisco received direct funding through the federal Energy Efficiency and Conservation Block Grant Program that was used to establish the framework of GreenFinanceSF.

This Solar Federal Tax Credit is not affected by the AMT or Alternative Minimum Tax.

San Francisco Solar Panel Discount

This program may have its funding slashed by 40% shortly, so get in now if you have been thinking about it. Go solarSF helps San Francisco residents acquire discounts on Solar panel installation in San Francisco. There is a GoSolarSF rebate of $2000-6000 and a firm that helps people collectively buy panels at lower prices. A 2Kw system for $6000 after rebates instead of $18,000. Pretty sweet.

Make sure you factor in any city permit or contractor installation fees. Also consider fixing any roof problems before you add solar panel.

San Jose Solar Discount

Let’s face it, solar panels are great but very expensive. The nonprofit Bay Area Climate Collaborative has set up a new program called SunShares that allows employees of participating companies and credit unions to buy solar panels at the significantly discounted price. San Jose city workers have a group by program of their own, that allows them to buy top rated SunPower solar panels at more than 40% off. Financing is available from the San Jose Credit Union.

They are looking for other municipalities and businesses to participate, so be sure to contact them.

Solar Panel Group Buy

1bog.org (One block off the grid) is working to aggregate solar purchases to save money. They are active in San Francisco Bay Area, LA, San Diego, and New Orleans. They are a community based, national organization helping to negotiate group discounts between consumers and solar installers.

Solar Power During Power Outages

Many people believe that their solar electric system will provide them with power when the power is off. Recently Super Storm Sandy reminded solar panel owners that this is not the case. A standard known as UL 1741 allows solar electric systems to be connected to an electric utilities system. The utility becomes an electrical backup, for times when the sun isn’t shining. The electric company becomes part of a centralized grid for distributing and buying power. If they are offline, the whole system shuts off.

You can go completely “off the power grid” by having your own battery backup. This option is extremely expensive and requires more maintenance and complexity. Most people that opt for this type of system live far away from electric wires.

With the recent solar rebates, it is a great time to get off the grid.

Be sure to read our article: Are solar panels for me?

Interested in Solar Energy? Read our articles on solar power:

• Are Solar Panels for Me?
• Solar Panel Installation - Planning
• No money down Solar Panels
• Solar panel cleaning

GeoThermal Heat Pumps are devices which transfer the heat from the Earth and utilize it to warm your house in a energy efficient manner.

A reminder that there is a Federal Tax Credit for Energy Efficiency on Qualifying GeoThermal Heat Pumps, with no cap. If you have been thinking about replacing these items, you might as well upgrade now and save some money.

For 2012, the Federal Tax Credit for energy efficiency for GeoThermal heat pumps is 30% of the cost (including installation/labor costs), with no upper limit . (2010 Federal Tax Credit information)

• Existing home and principal residence.   New construction and rentals do not qualify.

• Units must be placed into service by December 31, 2016.

Geo-thermal heat pumps are similar to ordinary heat pumps, but use the ground instead of outside air to provide heating, air conditioning and, in most cases, hot water. Because they use the Earth’s natural constant heat, they are among the most efficient and comfortable heating and cooling technologies currently available.   This allows the system to reach fairly high efficiencies (300%-600%) on the coldest of winter nights, compared to 175%-250% for air-source heat pumps on cool days.

Units can cost from $5,000 to $10,000 installed and take about 5-10 years for payback.

All ENERGY STAR geo-thermal heat pumps qualify for the tax credit.

Criteria for heat pumps:

Water-to-Air

·         Closed Loop: >=17.1 EER; >=3.6 COP

·         Open Loop: >=21.1 EER; >=4.1 COP

Water-to-Water

·         Closed Loop: >=16.1 EER; >=3.1 COP

·         Open Loop: >=20.1 EER; >=3.5 COP

·         Direct Geoexchange (DGX): >=16 EER; >= 3.6 COP

Energy Star has a store location finder to help you find local dealers.

The 2011 tax credit reverted to  2005-2008 levels. Anyone who previously took advantage of the program can’t apply for incentives that exceed $500.  IE If you claimed $500 between 2005 – 2008 on a previous energy efficiency project, or at least $500 tax credit from 2009 – 2010, you are ineligible for the 2011 energy efficiency tax credit.

If you used say $200 of the $500 energy efficiency tax credit from 2005 – 2008, and did not utilize the 2009 – 2010 energy efficiency tax credit, you would still have a $300 credit available.

Double dip! Local utilities like PG&E have their own rebates for Energy Efficient Products. To find out if rebates or other incentives are available in your area, visit the ENERGY STAR Rebate Finder.

See: Weatherize your home – Fix Leaky Ducts – Reducing Air Leaks

The Federal Tax Credit for Energy Efficiency – Windows, Doors, Skylights expired in 2011. The President chose not too extend this tax credit. Local energy utility companies like PG&E have their own energy efficiency rebates. To find out if rebates or other incentives are available in your area, visit the ENERGY STAR Rebate Finder.

Be sure to read our article: Weatherize your home – Fix Leaky Ducts – Reducing Air Leaks

A reminder that there is a  Federal Tax Credits for Consumer Energy Efficiency on Qualifying Windows, Doors, Storm Windows, Storm Doors, and Skylights. If you have been thinking about replacing these items, you might as well upgrade now and save some money.

For 2011, the Federal Tax Credit for energy efficiency drops to 10%, up to a $500 maximum. (2010 Federal Tax Credit information)

• Windows capped at $200
• Qualification now ENERGY STAR
• Existing home and principal residence.   New construction and rentals do not qualify.
• Expires December 31, 2011 – Consult the What other rebates are available? below for other possible rebates.

Pella even makes doors utilizing eco friendly, green, FSC Certified Rustic Walnut.

Consumer Reports.org has tips on selecting a door.

Storm Doors and Windows must meet International Energy Conservation Code (IECC) guidelines. Look for double glazed windows with an low emissivity (low-e) and a R-value of about two or three.

photo credit: ActiveSteve

The Federal Tax Credit for Energy Efficiency – Air Conditioning, HVAC expired in 2011. The President chose not too extend this tax credit. Local energy utility companies like PG&E have their own energy efficiency rebates. To find out if rebates or other incentives are available in your area, visit the ENERGY STAR Rebate Finder.

Be sure to read our article Air conditioner energy savings.

Heat is in the air and temperatures are increasing fast. Air conditioning, air conditioners, and HVAC equipment that cools specific rooms are popular and are aggressively marketed.

For 2011, the Federal Tax Credit for energy efficiency drops to 10%, up to a $500 maximum. (2010 Federal Tax Credit information)

• Split Systems:
  SEER ≥ 16
  EER ≥ 13
• Package systems:
  SEER ≥ 14
  EER ≥ 12
• $300 cap for air conditioners
• Existing home and principal residence.   New construction and rentals do not qualify.
• Expires December 31, 2011

The Federal Tax Credit for Energy Efficiency – Insulation expired in 2011. The President chose not too extend this tax credit. Local energy utility companies like PG&E have their own energy efficiency rebates. To find out if rebates or other incentives are available in your area, visit the ENERGY STAR Rebate Finder.

For more information on insulating your home see: Weatherize your home – Fix Leaky Ducts – Reducing Air Leaks

A reminder that there is a Federal Tax Credits for Consumer Energy Efficiency on Qualifying Insulation. If you have been thinking about replacing these items, you might as well upgrade now and save some money. Improve the R-value of attic, wall, and crawl space insulation.

For 2011, the Federal Tax Credit for energy efficiency drops to 10%, up to a $500 maximum. (2010 Federal Tax Credit information)

• 10% up to $500 for insulation, roofs, and doors
• Existing home and principal residence.   New construction and rentals do not qualify.
• Expires December 31, 2011

Insulation must meet 2009 IECC & Amendments. Rebate does not cover installation/labor costs. Do it yourself-ers can also get the credit.

Typical bulk insulation products can qualify, such as batts, rolls, blow-in fibers, rigid boards, expanding spray, and pour-in-place.

Using blown fiberglass insulation is one of the best methods of energy efficiency for the home. Proper insulation using this keeps rooms tightly sealed, as compared to the old standard of fiberglass sheets, or batts. Spray foam is the fiberglass industry’s newest product that does not contain harmful chemicals. Though the cost of blowing fiberglass into wall cavities is 40% more than utilizing the traditional batts, using spray foam is  up to 50% cheaper. The overall energy savings of the home will offset the higher insulation costs over several years.

Weatherize your home. Products that air seal (reduce air leaks) can also qualify, as long as they come with a Manufacturers Certification Statement, including:

• Weather stripping
• Spray foam in a can, designed to air seal
• Caulk designed to air seal
• House wrap

Energy Star has a store location finder to help you find local dealers.