The new year is well underway (Happy New Year!), and so it is timely to revisit the question of financial incentives to Go Solar in the Run on Sun service area. (You can read more detail about all of these incentives on our Solar Financing page.)
Beyond a doubt, the most significant incentive for going solar is the 30% federal tax credit. Previously set to expire at the end of this year, the federal solar tax credit was extended late last year, continuing at the present 30% through 2019.
The credit applies to solar installations in every utility’s territory, so no matter where you live in the U.S., this credit applies to you. (NB: this is a tax credit, not an income deduction, so you need the tax “appetite” to take full advantage of this incentive - check with your tax advisor.) For residential clients, the basis for the credit is the full cost of your solar project, less any rebate that you might receive from the utility. Commercial clients, who must declare any rebate as income, do not need to deduct their rebate from the system cost when calculating the basis.
Once common everywhere, utility rebates are going the way of the dodo—with one or two notable exceptions. We have rank ordered the local utilities below, based on the reliability of their rebate program.
The big winner, again and by far, is the solar rebate program operated by our own Pasadena Water and Power. Year in and year out, PWP offers rebates to its customers in a transparent and consistent manner - something that cannot be said of any of its neighboring utilities.
As of this writing, PWP is offering a rebate of $0.45/Watt for both residential and commercial customers, and a rebate of $0.90/Watt to non-profit customers (who cannot take advantage of the federal tax credit). Alternatively, PWP also offers a performance-based incentive that is paid out over two years based on the actual production of the system. Residential and commercial customers are paid 14.4¢/kWh, whereas non-profit customers are paid 28.8¢/kWh.
LADWP offers a rebate, if you have the stamina to receive it. Vexed with the most bureaucratic process to be found this side of Orwell’s 1984 dystopia, applying for and receiving a rebate from DWP often feels like a reward for a life well spent.
That said, LADWP is currently offering rebates of $0.30/Watt to residential customers, $0.40/Watt to commercial, and $1.15/Watt to non-profits. Just don’t hold your breath.
These two municipal utilities often feel like one and the same given their similar approach to rebates - which is to say, now you see ‘em, no you don’t.
Unlike their neighbor to the east, neither BWP nor GWP is able to maintain a rebate program throughout the year. Instead, both open their rebate windows on or about July 1st (i.e., the start of their fiscal year) and then hand out money until it is gone, at which time the window slams shut until the following July 1.
Burbank’s program operates under a lottery, which last year opened on July 1 and was exhausted by August 15. In addition, BWP imposes restrictions on the azimuth and pitch of rebated systems, despite their being no technical justification for doing so.
Glendale’s program is even less transparent, and the installation/rebate process is outlined in a 23-step ode to inefficiency.
We will revisit both of these program in mid-June to provide what guidance we can to the residents of these two cities.
The “Solar Partnership Program” in Azusa is fully subscribed. There is a wait list that solar-hopeful customers can get on in the hope that at some point there will be rebate funds available - with no guarantees that there ever will be.
The Anaheim Solar Incentive Program was fully subscribed as of October 1, 2015 and is now closed, with no published plans to revise the program in the future.
SCE’s rebates, which were part of the larger, California Solar Initiative, have expired and no new funds are anticipated. Of course, SCE customers still have the highest electricity rates around, which provides its own—albeit perverse—incentive to Go Solar!
UPDATE - We heard back from BWP - details at the end of the post…
The wizards at Burbank Water and Power have announced their solar rebate program will resume, but only for the lucky few who happen to be facing West. Here’s our take.
Having a stable, predictable solar rebate program is the key to making a solar program successful. Municipal utilities like Pasadena Water & Power, and investor-owned utilities (like SCE) participating in the California Solar Initiative, have had great success with their programs.
Then there are other munis, like Burbank Water & Power (BWP), that just can’t seem to get it right. BWP, like its similarly misguided neighbor, Glendale Water & Power, has had an on-again, off-again rebate program that baffles all who attempt to make use of it. Now, for a brief moment, BWP’s solar rebate program is on-again, sort of. During the month of August, potential Burbank solar customers are allowed to submit rebate applications (submission deadline is August 29 at 5:00 p.m.) for a lottery to be held on September 8th. The lucky 60 residential and 15 small commercial (<30 kW) customers who make the grade (no details on how the auction will actually be conducted have been released) will be advised of their good fortune by September 12th. Rebate amounts are $0.96/CEC AC Watt for residential and $0.73 for small commercial.
But wait, there’s more.
For the first time in our experience, a utility is limiting rebates for solar systems to only those which face in a generally westerly direction. In fact, systems facing true south are completely ineligible for rebates (as shown in the image to the left), even though such systems are the most productive!
BWP is essentially precluding the overwhelming majority of building owners from even having a chance at a rebate in their lottery system.
This continues a trend we have seen with other muni utilities (GWP we are talking about you) where solar programs are designed to be unsuccessful. It will be interesting to see if we can extract any data from BWP about the results of their lottery.
BWP’s Stated Rationale for Restricting System Azimuth
But why the restriction in the first place?
According to BWP, it is to insure that the power produced comes closest to overlapping with BWP’s peak afternoon demand from 4-7 p.m. Thus to qualify, systems have to be oriented between 200 and 270 degrees and have a minimum tilt of 5 degrees.
That seemed pretty arbitrary to us.
While we could understand a utility wanting to limit providing rate payer money to systems that yield the maximum benefit to those rate payers, there is certainly nothing magical about a limit of 200-270 degrees. In fact, somewhere around 270 should be the sweet spot for afternoon production, with a fall-off on either side. So why cutoff systems beyond 270 degrees?
We decided to run some models using NREL’s PVWATTS tool. We assumed a 10 kW system at a 10 degree pitch (a common residential roof pitch) and accepted the other defaults for the model. We then calculated the hour-by-hour output for systems with azimuths ranging from 200 to 330 degrees. Here are the results for the critical hours from 4 to 7 p.m.
All of the azimuth angles in the green box are acceptable to BWP, whereas all of the azimuth values in the red box are deemed unacceptable for a rebate from BWP.
But here’s the thing… see that green horizontal line? That represents the 4-7 p.m. output for our hypothetical array with an approved azimuth of 200 degrees. Yet five out of six azimuth values modeled here that are rejected by BWP, actually produce more power during the critical period than does our approved system at 200 degrees!
So what exactly is going on here? BWP’s asserted rationale does not hold up to scrutiny. Which begs the question, why, really, is BWP so seriously limiting who can participate in their lottery? It certainly is not justified by their desire to maximize 4-7 p.m. production. If that were truly the case, they should include azimuth angles all the way to 320 degrees. They would get more timely power production while opening their rebate lottery to many more potential customers.
How about it, BWP, what is going on here?
If you are a potential BWP customer who falls outside of the “accepted” azimuth band, you might want to contact the Solar Support program managers:
John Joyce: email@example.com or
Alfred Antoun: firstname.lastname@example.org
If you get a response, please add it to the comments.
UPDATE - We heard back from John Joyce, Solar Support Program Manager at BWP, about the outcome of the lottery process. According to Mr. Joyce:
105 lottery entries have been submitted and the budget is sufficient to allow each of these applicants to participate, therefore no lottery will be held.
We have a further inquiry in to Mr. Joyce to see if there is still budget left over to allow more applications going forward. We will update this again if we hear back.
We have just learned that the City of Burbank will once again be offering rebates for a very limited number of solar installations. Here are the details.
The total program is limited to projects below 30 kW; larger projects need not apply.
The program will pay rebates to residential customers at $1.28/Watt (CEC-AC) and $0.97/Watt for commercial customers. There is no carve out for non-profits, however they say that such entities “will be given lottery priority." Burbank says that is anticipates having enough funding for 50 residential and 10 commercial projects, with the allocation evenly split between the two. That figures to be around a total of 500 kW, 50 residential at 5 and ten commercial at 25 kW each. Surely the demand in Burbank is greater than that, so how will they handle the inevitable over-subscription? Easy - Burbank is holding a lottery.
Throughout the month of July, applications can be delivered to the offices of Burbank Water & Power. Then, on August 12, 2013, Burbank will hold a lottery and application numbers will be selected at random. (Not sure how that squares with giving non-profits “lottery priority".) The lucky few winners will be notified by August 16, 2013. “Winning” applications will have 1 year to complete their installation.
Not a great program by any stretch, but at least, for a while, Burbank is back in the game.
We have just learned that Burbank Water and Power (BWP) - which had suspended its solar rebates back in April 2011 - is introducing what might be the most bizarre rebate procedure ever - a rebate lottery! Here is the text of the announcement in its entirety from the BWP website:
Direction for how the program will accept new applications effective July 1, 2012 will be provided by the Burbank City Council on June 26. Staff is proposing the following:
Additional details will be posted on this web site in early July 2012. If you have additional questions please contact the program manager at email@example.com
- Retain the current policy of dividing the remaining non-Performance Based Incentive (PBI) budget amount evenly between residential and small commercial solar installations. This is projected to provide approximately $60,000 in incentives for each customer category.
- Lottery applications would be accepted from July 1 through September 1, 2012.
- On September 4, 2012, BWP would use a lottery system to provide an order of rebate consideration for both residential and commercial (including Not-for-Profit organizations)solar applications. Priority will be given to business accounts that fall under a not-for-profit designation.
- Applicants will be notified in early September of their lottery number and application status. ”Winners” will be provided one month to meet all previously defined system application requirements through BWP’s online PowerClerk system, including, but not limited to, a signed contract, meter service confirmation, and City permit application approval.
- Rebates would open at Step 6: $1.28/watt for residential installations and $0.97/watt for commercial installations.
If this announcement is to be taken at face value, this means that they will be setting up a two-month lottery for the chance to be one of maybe 12 residential projects to get a rebate and only one fo 2-4 small commercial projects. Seriously? All this Sturm und Drang for a grand total of 16 rebates? With no way for a BWP customer to know in advance whether they will be one of the lucky “winners"?
We sent an email to the address above asking for some clarification, but as of this publication we have not received a reply. If you think this “lottery” is as silly as we do, please send an email to firstname.lastname@example.org - maybe they will be more willing to respond to you!
While we weren’t watching, the folks at Burbank Water & Power (BWP) pulled the plug on their solar rebate program, continuing the trend of on-again/off-again solar rebate programs at Southern California municipal utilities which has also included LADWP and Glendale Water & Power in the past year. Of the local munis, only Pasadena Water & Power has managed their program without interruption.
Here is the announcement from BWP’s website:
Due to the overwhelming success of the BWP Solar Support Rebate program and budgetary restrictions, effective April 21st 2011 the program has been suspended. Only those rebate applications in the on-line software PowerClerk with a status of “Confirmed Reservation” will be paid. These payments will be made when all remaining documentation is provided, but no sooner than July 1, 2011. All other solar rebate applications will be canceled and paperwork mailed back to the installer. Please check back to this web site in the spring of 2012 for a possible update. Solar Installers with customers that wish to proceed without a solar rebate should contact the program manager at email@example.com for details about the Solar Interconnection Agreement and other requirements.
Pardon us for a contrarian view, but when you have to suspend your program mid-year, it isn’t an “overwhelming success” — it is mismanaged.
Potential solar clients and solar companies alike need predictability - not programs that can simply disappear without prior notice.
Which brings us to another curious thing about this website announcement - it says that the effective date for the program suspension was April 21, 2011 but the earliest public disclosure that we can find about the change is this article in the local newspaper, the Burbank Leader, titled “Burbank Officials Suspend Solar Rebate Program,” dated August 30! Now it is true that we do not monitor the BWP website on a daily basis, but it stands to reason that if this suspension had been announced earlier, we would be able to find some notice of it online before August 30 - four months after the suspension date! (Interestingly, the last press release displayed on the BWP website is from April 22 but it says nothing about the suspension.)
If that timing is accurate, it means that solar companies could have been devoting time and resources in a tight economy to developing business in Burbank for a third of a year, only to have that expenditure rendered largely useless at the caprice of another muni utility that cannot manage its budget.
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