When your system starts to generate more electricity than you actually consume your utility meter begins to spin backwards sending overage electricity back to the grid. You then accrue credit with your utility company at the same rate they are charging you which allows your monthly electric bill to be reduced to a zero amount. Electricity prices on average have increased about 6.7% per year for the last 30 years. Once you choose solar, you are able to lock in low electricity prices which no longer make you dependent on foreign oil or increasing energy rates.
Homeowners can expect their property resale value to increase significantly. An article published by the Appraisal Institute showed that property resale values will increase $20 for every $1 saved annually in electricity. Currently solar electric systems are 100% property tax exempt.
The state of California has placed the California Solar Initiative (CSI) which is currently paying a state rebate to all homeowners and business owners going solar. In addition to the state rebate, the federal government has placed a 30% federal income tax credit on residential solar systems. By utilizing both state and federal incentive programs the total system cost is reduced resulting in solar power being a great home investment. The amount of state rebates reduces significantly with every 10MW applicants. Please contact your So-Cal Solar Account Executive to secure your rebate before the next decline in the California Solar Initiative state rebate program.
One of the biggest advantages to owning your solar electric system is being able to receive a federal tax credit. Being able to know the difference between a tax credit and a tax deduction will really help you understand how a tax credit is valuable. A tax deduction reduces your taxable income by the amount of the deduction and a tax credit reduces your actual tax liability. For example, if your taxable income is $85,000 you are able to reduce your taxable income with a tax deduction and your taxes will be on the remaining amount according to your tax bracket. The Renewable Energy Tax Credit is a tax credit, which allows for a greater benefit. If you have taxable income of $85,000 and are placed in the 25% tax bracket, you would owe $21,250 in taxes before the credit. If your credit is 30% of a $25,000 renewable energy system, you will be able to subtract your tax payment by $7,500. If you have already paid taxes in the amount of $21,250 over the course of the year, you will receive a credit in your tax return.
Please reference the following link for more information about your state rebate and federal tax credit http://www.dsireusa.org/.
Depending on how you decide to finance your solar electric system it still holds a strong return. When you finance your solar electric system your loan monthly payment will be less than your monthly electric bill which allows you to see a return instantly. Bottom Line in today’s economic crisis purchasing solar is one of the strongest and most secure investment you can make for your future.