According to one of the data on the list of the sunniest states in the U.S., Colorado ranked number 6, with approximately 86.19% or beyond 300 days of sunshine in a year. This alone is an incredible opportunity to consider investing in a solar system. And as electric bills across the country go, Colorado is in the middle, ranking 25th for highest bills. Electric rates in Colorado put the state at the ninth highest in the country. Investing in solar energy is more financially rewarding in states with high electric bills.
The state government offers solar incentives and rebates for Coloradans to support renewable energy to succeed in Colorado.
Continue reading to explore how you can benefit from going solar!
Colorado has excellent innovative Renewable Portfolio Standards (RPS). By 2020, Colorado was mandated to generate 30% of its energy from renewable sources through the RPS. If the standards are not met, utilities will be charged high fees. So naturally, instead of paying the fees, utilities in strong RPS states offer solar incentives for property owners to invest in solar panels.
A carve-out is that portion of a state's renewable energy that must come specifically from solar. It is incorporated in most RPSs since the program is leaning toward reducing renewable technologies' costs. The solar carve-out offers solar incentives for the distribution of reduced technologies. RPS, above, is about all renewable energy sources, but the solar carve-out is a requirement just for solar. In Colorado, the carve-out was 3% by 2020.
If Coloradans invest in a solar system, they must be guaranteed to acquire credits for every energy their solar system produces. Fortunately, Colorado open and concrete net metering law makes it an absolute state asset. Net metering is a system that connects solar panels or other renewable energy generators to the grid. This plan allows solar customers to receive credits on their electric bill for the power they generate and offset the cost of the power they draw from the utility company. If your solar system produces surplus electricity, it can be sold to the grid, and you can see the credit on your electric bill.
Most property owners hope for an open, streamlined, reasonable, and foreseeable scheme for connecting to the grid. Interconnection standards are guidelines that dictate how solar systems can be connected to the electrical grid and other electrical generation systems to the power grid, facilitating more accessible and often more affordable installation, thereby enhancing the dependability of net metering. Standards in Colorado are strong and statewide.
The state's program lets you take the rebate in a lump sum, or your solar installer can take it off the bill. One advantage of the latter method is that the installer handles the paperwork. You can claim the credit for your primary residence, vacation home, and an existing structure or new construction.
Thankfully, Colorado is one of many states that offer PBIs. It is a monetary reward for the solar incentives that compensate a property owner based on their solar system's power. Colorado calls them Solar Power Performance Payments. The compensation is determined by the amount of electricity your system generates, measured in kilowatt-hours (kWh) or BTUs, and tracked by the meter. The electricity produced is then credited as Solar Renewable Energy Credits (SRECs), whose value varies based on supply and demand. SRECs provide an effective way to help offset the cost of your solar system.
Coloradans who invest and set up a solar power system to generate energy on their property are eligible to be exempt from the total price the device imparts. To take advantage of Colorado Solar Property Tax Exemption for solar systems, it's important to keep paying your previous property tax even after the solar panel installation. This way, the value of your home will not be reassessed.
Luckily, the state of Colorado was given local jurisdictions the control to exclude sales tax in installing a solar energy system. So invest in those solar panels and pay no sales tax.
Several Colorado utility companies and local societies provide cash rebates to property owners who invest in solar power. One example is Energy Smart Colorado, which offers solar incentives and rebates from $400 to $2,500, depending on your location. Ensure to search in your locality for the accessibility of these choices.
Eligible property owners with solar panels may qualify for a 30% tax credit versus the system cost.
Colorado most significant electric utility Xcel has an incentive-based program where payments are made monthly or yearly to the property owner of the solar system in trade for Renewable Energy Credits (RECs) for the energy produced by the solar system.
On top of these great Colorado rebates and exemptions, Colorado property owners can also qualify for a sizable tax credit from the Federal government. The Federal Investment Tax Credit (ITC) is equivalent to 26% of the solar system cost and is subtracted from your Federal income tax. This credit is only available for those who purchase their solar system through cash or loan, not those who lease it. If you lease a system, the incentives will go to the third-party owner, which is a compelling reason to buy instead of leasing.
Begin your journey and utilize all the benefits you can gain by going solar in Colorado!
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