Georgia, New York, and the Mid-Atlantic States, Plus Emerging Markets
In Part 1 of Top U.S. States for Commercial and Large Scale Solar, we showed how sun potential and progressive solar policies in California, Colorado, and Hawaii made for an excellent environment for commercial solar today. In Part 2, we’ll look at policies in Georgia, New York, and the Mid-Atlantic states.
It’s no surprise that Georgia has excellent insolation, and a brand new Feed in Tariff. If you own a building or available land in the Peach state, you now have an excellent opportunity to turn that real estate into a solar income property.
You can either build and own a system, and receive a check from Georgia Power, or you can simply rent out your sunny location and receive a check for hosting a clean enegy generator.
There has been a lot of pent up demand in Georgia Power, so interested parties will need to act quickly because the program will sell out quickly.
New York has lagged behind other solar markets, but looks to leapfrog several states, as there is set funding for a complex but lucrative performance-based incentive through the end of 2015. That makes it one of the most stable incentive programs in the U.S. today. This incentive, along with the Federal 30% Investment Tax Credit (ITC), allows for a great environment for financing commercial solar systems, including solar PPAs.
And if you’re in Long Island Power Authority territory, the utility is offering one of the largest FiT incentives available in the United States.
Contact REC Solar about the details of these programs and how you can significantly reduce your electric costs, or even generate income through the LIPA FiT.
PENNSYLVANIA, NEW JERSEY, MARYLAND, DELAWARE, WASHINGTON DC, AND OHIO (PJM)
Many New England and Mid-Atlantic states utilize Solar Renewable Energy Credits (SRECs) as the primary solar incentive. While New Jersey remains the largest market in the region, other rapidly-growing solar markets include Massachusetts, North Carolina, Rhode Island, and Washington DC.
In many of these states, renewable energy policies require electric distribution companies to procure a minimum amount of renewable energy every year. If they don’t procure enough renewable energy, they either have to pay a substantial penalty for the shortfall…or they can purchase credits (SRECs) that show that solar is being generated by private solar installations in the state.
As a result of this program, the more large solar systems are installed, the more the price of the SREC is reduced. However, solar system production can vary by the season, and other SREC market factors can also drive prices higher.
For example, new long term SREC procurement programs are being created, which will eventually create a supply shortfall and drive SREC prices up. When SREC prices go up, that will encourage more commercial solar to be developed, creating solar jobs, as well as income for the owners of commercial solar systems.
SREC market pricing is complicated, but REC Solar’s experience working with utilities and developers can help sort out whether now is the right time to take advantage of SREC incentives in your particular state. We believe that there are many opportunities right now, especially for large commercial systems and solar PPA financed projects.
COMMERCIAL SOLAR MARKETS THAT ARE GETTING HOTTER: ILLINOIS, AND NEVADA, UTAH, AND PUERTO RICO
In Illinois, the legislature recently passed an aggressive RPS with an SREC component, plus there’s a rebate of up to $10,000. Since there are very few solar installations in the state, demand for SRECs will be high and supply will be low, making large commercial projects attractive. That being said, there some legislative adjustments needed to make commercial solar a terrific opportunity. If you’re interested in learning more, contact REC Solar to see whether the numbers work for you.
Utah’s Rocky Mountain Power has a well-funded rebate program that can give your business up to $800,000 towards the cost of your solar development. That’s certainly an opportunity not to miss while it lasts, especially when combined with the Federal 30% ITC. Additionally, there are other state corporate tax credits available, so for those businesses that would rather benefit from solar energy savings than pay taxes, now is certainly a great time to install commercial solar in Utah.
Nevada has more solar energy potential than most of the United States, and recent changes in its incentive program makes it a great time take advantage of all of that sun. Similar to states with SRECs, Nevada has created a Portfolio Energy Credit (PEC) program, and solar systems credits are more than twice as valuable than any other renewable energy source, such as wind. Of course, the value of PECs will fluctuate depending on supply and demand, but as this program is new, demand is high. Therefore, now is the time to install solar and benefit from the higher PEC price.
Like Hawaii, Puerto Rico has a lot of sunlight and not a lot of traditional fossil fuel to power the island. Consequently, the electricity cost is high, making free energy from solar power very attractive for businesses and residents. On top of that, systems over 100 kW can receive a 50% rebate towards the cost of their solar system.
As we’ve seen in this two part series, there are some very attractive areas to be installing commercial solar right now. If you need more information or help deciding whether now’s the time to go solar, contact REC Solar. No matter what area you’re in, we’ll help you to work out the cost and potential IRR for your commercial, municipal, or industrial solar project.