Government Grants for Solar Improvements

• Solar power can be an effective way to cut down on energy costs for your home or workplace while helping the environment. No cost-benefit calculation of a potential investment in solar improvements is complete without including the numerous grants and other incentives offered by federal, state, and local governments. The 30 percent grant offered by the federal government is only the tip of the iceberg when you consider the tax credits, loans, and rebates that may be available to you.
  
  

Federal Incentives

• The American Recovery and Reinvestment Act of 2009 (ARRA) enacted a grant program for renewable energy in commercial, industrial, and agricultural applications, including photovoltaic (electricity-producing) and solar-thermal (heat-producing) systems. The grant amounts to 30 percent of a solar system's cost. In place of the Federal grant, businesses can qualify to receive the same amount in Business Energy Investment Tax Credits. In addition, the Rural Energy for America Program offers up to 25 percent of project costs in rural areas.
  
  Besides grants, the federal government offers numerous other incentives for solar energy. For residences, a taxpayer can claim a tax credit worth 30 percent of expenditures on a solar-thermal or photovoltaic (PV) system. ARRA also provides for guaranteed loans of up to 30 years for nonresidential projects that employ innovative technology; the program expects to give out $8.5 billion in loans.
  
  

State Incentives

• Most state governments offer some form of incentive for solar improvements. The California Solar Incentive, which will offer $3.2 billion in solar incentives over 10 years, is the largest but by no means the only state program. Residential, nonprofit, and small business PV installations in Nevada are eligible for the RenewableGenerations Rebate Program, which pays $2.10 per watt of electricity they produce ($4.20 for nonprofits and schools). For instance, a small business's 10 kW installation would earn a $21,000 rebate.
  
  Georgia also offers rebates for nonresidential solar projects, for up to 35 percent of the equipment's cost, in addition to tax credits of 35 percent for residential installations. For solar projects in Arizona, the state government offers residential buyers 25 percent tax credits and nonresidential buyers 10 percent tax credits. Purchasers of large commercial systems in New Mexico can also receive tax credits, for $0.027 per kilowatt-hour.
  
  

Local Grants

• Numerous local governments and utilities offer solar-energy incentives for homes, businesses, and nonprofits. The City of San Francisco, for instance, offers homeowners between $1,000 and $2,500 and businesses $1,500 per kilowatt for photovoltaic installations, while Berkeley offers up to $37,500 for PV projects. Boulder, Colorado, gives grants for up to 50 percent of solar project costs on a case-by-case basis. And in Chicago, small businesses can be eligible for grants of up to 75 percent of the cost of a solar installation.
  
  Check under Resources to find a program in your area.