Residential Investment Tax Credits Pass

The investment Tax Credits finally became law.  The commercial tax credits were extended for 8 years until 2016.  The residential tax credits are where the real news is, however.  The residential tax credits were also extended for 8 years but they are a full 30% of the solar system cost.  This will have a strong affect on solar sales nationwide, especially in States with high power costs. 

The major issues facing the solar industry in the next year will continue to be either tightened credit due to the financial crisis, or, shortages of solar modules due to increased demand nationwide.  It is not clear which constraint will win out.

In California, the California Solar Intitiative is still at $1.90 per watt in SDGE territory (residential) and $2.20 per watt in SCE territory (residential).  This will cover approximately 20% of the total system cost.  If this is added to the 30% tax credit, a customer can save 50% of the total system cost.  

The good news for many customers that are on the AMT, both residential and commercial, is that they can still take these tax credits.

Overall, Solar in the California market is now a better investment than anything including real estate, bonds, stocks, commodities or cash due to the fact that the volatility is low and the long term yield is high.

Popularity: -0% [?]