Besides the wonderful societal implications of “going green,” as a homeowner or business owner in Connecticut, you are going to want to know that installing solar panels will provide a strong return on investment on a solar purchase, and a position of positive cash flow on a solar finance program like a solar loan, solar lease, or solar ppa.
CT solar customers can expect to be presented with these options from solar installers in their area. Assuming ideal site factors and high customer utility costs, these CT solar customers will be able to save money and also generate income through energy savings, the solar investment tax credit, ITC, and the Connecticut state solar rebate known as the Residential Solar Investment Program.
The average price of electricity in Connecticut residentially is 17.34¢/kWh, which places Connecticut at #4 for the highest rates of electricity in the country.
In fact, the price of power has gotten so high, that homeowners can save money by installing solar panels without putting a cent down towards the installation. These homeowners will enter into a solar lease or solar ppa with a solar company. In many instances signing up is as easy as clicking a button. In this model, the solar installation company will install the solar system through funding from a solar finance company. The homeowner must have a good credit standing and a site conducive to solar. The solar finance company will provide milestone construction payments to the solar installer, and the system will be paid back monthly to the solar finance company from the homeowner. Basically, homeowners in Connecticut are choosing to purchase their power from the solar panels on their roof at a lower cost than the utility company.
In fact, the energy produced by solar panels in Connecticut has become so affordable, and the price of electricity from the grid has become so high, that solar in Connecticut has, in many instances, reached “grid parity.” Grid parity is when solar or any alternative energy sources, become less expensive than the electricity provided by the utility company. Grid parity can be hard to define as the model of electricity production and sale of electricity by the utility company is different than the energy produced by the solar panels on someone’s home or business. On the utility side, there are sometimes power plants and local distribution companies (LDC), that are different companies, but enter into a PPA (power purchase agreement) with customers to purchase the power at a fixed rate. Sometimes this rate is constant, and other times the rate can be subjected to “time of day” pricing which can increase the price of power exorbitantly. When considering the price of power going up during peak times, solar panels can be used to decrease the need to buy energy at peak which is usually during the day when the sun is shining on the solar panels.
These high costs are what makes solar more affordable than buying power from the utility company in Connecticut. In addition to saving money off your electric bill, solar customers in Connecticut, like the rest of the country, can expect to get the 30% tax credit (ITC).
The tax credit will be going down in 2020 to 26%, but it is still substantial savings.
This credit is available only if you own the solar panels through an outright purchase or a solar loan. In a solar lease or solar ppa, generally the finance company will be taking on this tax credit.
The solar incentive particular to Connecticut is the Residential Solar Investment program. This is a state rebate which pays back $.054/watt on a solar project capped at 10 kW. That means a 10 kW system would get $5,400 back right off the bat. Let’s assume your project is a 10 kW system and the price is $3.00/watt. This would be a $30,000 solar system. In year one you would get $9,000 back in the form of a federal income tax break, and $5,400 from the state. That is 48% of your project cost back to you in year one alone!
With the high costs of electricity, the lowering costs of solar panels, and the available incentives, it is no wonder so many homeowners are installing solar panels in Connecticut. Green Power Energy is moving into CT in 2020. Give us a call to find out if solar panels are right for your home and start saving money!