Clean energy advocates in New Hampshire have two big reasons to be thankful this season – the New Hampshire Public Utilities Commission has announced an expansion of the solar hot water rebate available to homeowners and has released the application for their commercial solar hot water and solar electric rebate (PDF).

Here are some details on both programs:

Residential Solar Thermal is Hot

The solar hot water rebate in New Hampshire is tiered based on the performance of the system, which is expressed in MMBTU / year. This consists of a state rebate that ranges from $600-900 and a federal rebate which has been raised from $750 to $2,000.

Here’s what the rebate program looks like for different kinds of systems:

For a typical residential project (2 flat plate collectors which produce ~18.25MMBTU/yr) installed at a cost of around $10,500, the incentives amount to $5,750, well over half the cost of the system!

The rebates are retroactive, as well, so if you recently installed a solar hot water system and qualified for the New Hampshire state rebate, you can expect a holiday gift from the PUC soon.

Rebates Arrive for Business

The solar hot water system for Moat Mountain Brewpub will save the brewery an estimate 520 gallons of oil a year

Equally exciting is the arrival of the much anticipated commercial solar hot water and solar electric rebate.

This program makes $1,000,000 available to solar thermal and solar electric projects for businesses, schools, municipalities, apartment buildings – basically any structure not eligible under the residential program.

The rebates are pretty straightforward:

• Photovoltaic (Solar Electric): $1/Watt up to $50,000 (or 25% of the project cost, whatever is less)
• Solar Thermal rebate: $0.07 per kBTU/year up to $50,000 (or 25% of the project cost, whatever is less)

Like the residential solar hot water program, a RETScreen modeling analysis is used to calculate the kBTU/year performance of the solar hot water systems.  Solar electric is fixed based on the nominal wattage.

Solar Economics are Amazing

The generous rebate makes it extremely attractive to invest in solar if you’re a business.  Let’s take, for example, a medium scale solar thermal project for a business that uses a lot of hot water – a hotel or retirement home, perhaps – and is currently heating that water with oil.

We’ll propose a system of 20 flat plate hot water collectors and several super-insulated tanks that will produce over 182,500,000 BTUs/year of clean thermal energy.  We’ll imagine that the system will save 2,300 gallons of #2 oil per year, a result of both reduced oil use and greatly reducing standby losses of the oil boiler in the summertime.

Assuming this hot water system costs around $100,000 gross to install, the fuel savings alone will pay for the cost of the system within its first decade of operation.

However, now there is an exciting suite of rebates to apply:

$100,000 gross installed cost
($30,000) federal tax credit
($28,900) accelerated depreciation – avoided taxes over 5 years thanks to lowered net income, assumes 34% marginal tax bracket
($12,775) state rebate – $0.07/modeled kBtu/year
$28,325 net investment – less than a third of the total cost of the project!

Within this new context, that same solar hot water system will pay for itself within two years thanks to the fuel savings.

While the wasteful boiler imagined in this formula is a “best case” scenario for solar, the economics work out for businesses of all sizes who are ready to both take an enormous cut out of their carbon emissions and save money while doing it.

Contact us for more information about both the commercial and residential solar rebates or to schedule a free site evaluation.

While it’s faced legal hurdles in other parts of the country, Property Assessed Clean Energy (PACE) financing may finally be arriving for Maine residents as early as mid-November according to Efficiency Maine. UPDATE: As of April 4, 2011, PACE Solar Loans are now available.

This unique program allows residents in towns that have passed a PACE ordinance to get low-interest loans on energy efficiency and renewable energy systems, everything from insulation and caulking to solar hot water and solar electric systems.

The program allows homeowners to get an energy efficiency loan that is tied to their property – rather to them personally – so that they will not be liable for the loan if they decide to sell the house. In the meantime, however, a home with improvements financed through the PACE program will benefit with improved comfort and reduced fossil fuel energy costs and carbon emissions.

How Does PACE Work?

PACE loans will be available for up to $15,000 on what Efficiency Maine calls “energy saving improvements,” that is, either work that “result[s] in increased energy efficiency and substantially reduced energy use” or a “renewable energy installation or an electric thermal storage system.” Which means that residential solar hot water systems and grid-tied solar electric systems qualify for loans under the program (from the Model PACE Ordinance (PDF)).

These loans are intended to be tightly entwined with performance of efficiency upgrades so that the cost of the loan payment is comparable to or less than the current utility payment. PACE loans will not be allowed for terms longer than the expected life of the improvement.

Solar hot water systems, such as this one in Biddeford, Maine, will save the homeowner more than $15,000 in utility bills over its first 20 years of operation.

This is certainly a good model for solar energy systems which will last more than 20 years, and are most affordable when taking a long view of energy savings.

For instance, a typical solar hot water system saves 300 gallons of home heating oil per year, worth roughly $780/year at today’s prices, for a savings of more than $15,000 over the life of the system. With an out of pocket cost of $5,500 to $6,000 once you factor in state and federal rebates, it will take about 8 years for the system to pay for itself.

The same system, benefiting from a 15-year PACE loan at 5% interest, results in a payment of roughly $71/month, or $852/year.  Since the PACE loan is based on net installation cost of the system, you would still benefit from the $3,150 federal tax credit, which if applied to your monthly payment would bring your average payment down to $57/mo, or $684/year.  A financed system saves money from day one!

How Can I Get a PACE Loan?

Getting access to the fund requires a few things:

• You must live in a town that has passed a PACE ordinance. So far that includes Cumberland, Yarmouth, Arrowsic, Waterboro, Fayette, South Portland, Old Town, Hampden, and Belfast with dozens more in process. If you’re unsure whether your town has passed an ordinance, now is the time to call your town office!
• You must have an energy audit done, and the energy auditor must be able to show that your proposed system will meet Efficiency Maine’s performance requirements. PACE will be managed through Efficiency Maine’s existing Home Energy Savings Program (HESP), which requires a computer model that demonstrates a 25% energy savings from the proposed efficiency improvement.This modeling biases towards weatherization, though solar hot water can also be considered (since combined with boiler improvements solar hot water achieves dramatic decreases in home heating oil use). It’s not clear how solar electric systems will be evaluated for PACE loans just yet.

What About PACE in New Hampshire?

Unfortunately, PACE legislation has hit a big snag in New Hampshire. SeacoastOnline reported it this way:

Last year, the New Hampshire Legislature passed House Bill 1554 to create the framework for municipalities to develop PACE, according to Eric Steltzer, a policy analyst for the state Office of Energy and Planning. New Hampshire set up PACE as assessment districts, such as a water or sewer district. As such, PACE became a priority lien holder.

Freddie Mac and Fannie Mae, the Federal Home Mortgage Corp. and Federal National Mortgage Association, respectively, balked at being put in a secondary lien position. The mortgage giants said they would not support PACE in states in which those loans are given a priority status on liens, said Steltzer.

This means, said Steltzer, “When you sell your house, they will not offer a mortgage on a property that has PACE on it. I do not foresee any communities in New Hampshire creating PACE entities.”

In contrast, Maine’s program specifically states that the PACE loan is secondary to the primary mortgage to avoid this road block. However, New Hampshire citizens still can take advantage of terrific state rebates and a growing number of private financing options.

We’ll keep you posted as the program evolves in both Maine and New Hampshire, and of course alert you to any new rebate programs, incentives, or solar financing options!

Resources on PACE

• Towns backing energy efficiency loan program – Current Publishing
• Maine seeks to pick up ‘PACE’ of energy savings – SeacoastOnline
• PACE Incentives – DSIRE
• PACE FAQs – Efficiency Maine
• PACE Model Ordinance – Efficiency Maine (PDF)
• PACE Law Enacted in Maine – Efficiency Maine (PDF)

This 4.8kw solar electric system in Meredith, New Hampshire benefited from the $6,000 cash rebate. 1.4 megawatts of solar electric were installed during the course of the program, enough to offset 2.5 million pounds of C02 each year, the equivalent of removing over 200 cars from the road, or planting more than 6,000 trees.

As expected based on order of notice DE10-194 and the pursuant public hearing (see our coverage here), New Hampshire has reduced their residential solar electric rebate.

In the original notice, the expected drop was from $3/watt, $6,000 max to $1.5/watt, $3,000 max. The drop was not as dramatic as original anticipated. Instead, the new rebate structure is $1.25 per watt up to a maximum of $4,500.

Here is Jack Ruderman, Director of the NHPUC’s Sustainable Energy Division, on the change:

Simply put, the program has been so successful since its inception in July 2009 that we have effectively exhausted our funding for the current state fiscal year (which ends June 30, 2011). To date we have received 473 applications requesting a total of $2.7 million to install systems with a combined capacity of 1.4 megawatts. The combined value of these systems is $9.6 million, resulting in leverage of nearly $7 million in homeowner funds … Consequently, the Commission issued an order this afternoon reducing the incentive level to $1.25 per watt up to a maximum of $4,500 or 50% of eligible system costs …

We will continue to offer our residential solar hot water rebate program, a well-funded program offering generous state and federal rebates, and a residential wood pellet heating rebate program offering rebates of up to $6,000. In addition, we will soon be offering a commercial and industrial rebate program for solar electric and solar hot water systems, and this winter we will issue a Request for Proposals to offer funds for renewable energy projects on a competitive basis. As more funds become available we will look to offer rebates for additional renewable energy technologies. Our mission is to offer an array of financial incentives for those who are ready to invest in a clean energy future.

We appreciate Ruderman’s upbeat attitude, particularly in regards to pushing the upcoming commercial and industrial rebate program. We’re eager to see how New Hampshire is able to encourage businesses to lock in their utility rates and offset their C02 emissions.

For full information on the changes, see the full Order DE 10-194 (PDF).

How Does This Affect The Affordability of Solar Electric?

Even with the reduced cash rebate, purchasing a solar electric system locks in an electric rate better than what’s offered by the utility.

Here’s a modified version of our chart from our original post, PV Costs Less than Grid Electric – Even at Today’s Prices:

Taking the long view, solar electricity is still an excellent investment – one that will provide tens of thousands of dollars of energy savings over its first 25 years and probably will continue to operate for nearly double the lifetime calculated here!

Stay tuned here for news about the business and industrial rebate, we’ll post it as soon as we know, probably the same day the order is given.

New Hampshire is becoming a renewable energy leader in the Northeast thanks to increasingly progressive energy policies and generous incentives for solar installations.

Homeowners have been able to enjoy a $3/watt system rebate up to $6,000, which takes a big bite out of the cost of a solar electric system and brings the ‘simple’ return on the system to under 7 years in many cases (see more on solar electric ROI).

However, in a recent order of notice (DE10-194 – full details here (PDF)), New Hampshire’s Public Utilities Commission has proposed reducing the rebate from $3/watt, $6,000 max to $1.5/watt, $3,000 max.

Here’s an explanation:

The incentive payments are funded through the Renewable Energy Fund (REF), which is supported by alternative compliance payments (ACPs) made by electric service providers who cannot meet their Renewable Portfolio Standard (RPS) obligations through the purchase of Renewable Energy Certificates (RECs) …

the REF [has] an uncommitted balance of approximately $1.5 million. Given that the small residential renewable incentive program experiences an average of 20 incentive applications per month, totaling an average of $12,800 per month in incentive payments, or, $1.5 million annually, and assuming this rate of participation will continue at that level, the fund could be exhausted by this program before the end of fiscal year 2011 and would likely exceed the portion of funding that should go to residential programs …

Based on these factors, the Commission proposes to halve the incentive payment to $1.50 per watt and the per-system maximum to $3,000 for small residential electrical renewable energy facilities. Lowering the incentive payment and per-facility maximum amount will allow for the same number of systems that are currently processed for rebates to be eligible for incentives, thus providing continued business for installers of small residential renewable generation systems.

In other words, the program has been a victim of its own success!

UPDATE: According to the PUC at a September 1 public hearing, in the 13 months that the program has been in place, they’ve received 443 applications, of which 296 have been successfully completed and 147 are pending.  While they average 20 approved application per month, recently they received 27 new applications on as single day!

The upside of the drop in the residential rebate is that New Hampshire plans to introduce a business rebate very soon.

Commercial Rebates on the Way

The great news for business owners and anyone interested in cleaner New Hampshire air is that there will soon be commercial, nonprofit and municipal cash incentives for both solar electricity and solar hot water.

We attended a technical session on August 19 to review the PUC’s renewable energy rebate design considerations. There is an additional opportunity for public comment on August 30 at 10AM and opportunity for written comment until Sept 3.

There may still be changes yet, but the suggestions under consideration:

• the… incentive payment for PV systems will begin at $1.25 per Watt for the first 20 kW and would decline to $1.00 per Watt for the next 35 kW and to $0.75/Watt from 55 kW up to 100 kW. In addition, the C&I rebate for a PV system would be capped at 25% of the cost of the facility, or $50,000, whichever is less. The $50,000 cap would be reached at a system size of45 kW under these incentive levels.

• The [solar hot water] base rebate would be $0.07 per rated or modeled kBtu/year, capped at 25% of the cost of the facility or $50,000, whichever is less, as a one-time incentive payment.

Details in the full order of notice (PDF).

We’ll be attending this session and will write up the results and likely changes as soon as we have more details!

This NREL map shows the states in the United States where feed in tariff legislation has been passed – only 14 states so far

The National Renewable Energy Laboratory (NREL) has released the largest report on feed in tariffs ever produced by a US Government Agency.

The 144 page document, called A Policymaker’s Guide to Feed-in Tariff Policy Design (PDF Download), analyzes the results of Feed in Tariff legislation in over 75 countries, including the efforts so far in the United States.

What is a Feed in Tariff and Why Should I Care?

A Feed in Tariff (FiT) is an alternative to taxpayer-subsidized incentives for renewable energy programs. With a FiT, the government mandates electric utilities to pay a certain above-market rate for electricity generated by net-producers. Meaning, an individual with a good solar location can install solar panels and turn a profit.

There are a number of reasons that a FiT is more effective than cash and tax incentives towards spurring renewable growth:

• The FiT is a performance based incentive – Quality of system design and performance is determined based on a need for return on investment.
• The FiT does not depend on taxes – Since incentives rely on tax money, at some point those coffers will empty and the incentives run out.  A FiT can be financed many ways, usually in the electric market. This takes a burden off of strapped state and federal budgets, and permits renewable growth to scale.
• The FiT offers a predictable return on investment – Solar energy systems offer a predictable rate of production whose value increases as the cost of electricity increases. Given the state of the economy, a renewable investment can be more secure than the stock market!

Key Findings of the Report

The NREL report does a good job of debunking feed in tariff myths, while also critically examining policy challenges faced abroad. Some of their more interesting findings:

• “FITs are responsible for approximately 75% of global PV and 45% of global wind deployment” (5)
• “The arguments in favor of a FIT policy are primarily economic in nature. These include the ability to … stimulate significant and quantifiable growth of local industry and job creation … [and] only cost money if projects actually operate” (27)
• “RE developers benefit from the long-term stability of the revenue streams generated from electricity sales, which helps foster a high level of investment security.” (121)
• “Another benefit is the direct competition for market share that is occurring under FIT policies in countries such as Germany, France, and Spain. This can drive greater private R&D investment, while helping spur further innovation and technological cost reduction” (121)

The report cites a number of primary, secondary, and tertiary benefits (pg. 18-20) for growing the renewable energy with FiT policies, such as:

• Increasing local jobs and developing the economy
• Reducing greenhouse gases
• Displacing load (to phase out coal fired power plants)
• Peak shaving (i.e. reducing the peak load conditions which CMP cites as the reason for the $1.4 billion grid upgrade)

The report then goes on to discuss in great detail the pros and cons of different models of feed in tariffs and the variety of ways they can be made into policy. Variations include payouts based on fixed rate prices vs. premium rates which fluctuate based on the market, to sliding scale rates based on economic conditions and those that vary based on resource quality and location.

You can read this in-depth report for free. (PDF Download)

Will a Feed In Tariff Make it to Maine (and New Hampshire)?

If you’ve been following our blog for a while, you’ve seen our coverage of Maine’s own attempt to establish feed in tariff, which was voted unanimously “Ought Not To Pass” in May, 2009.

A watered down version of the bill, providing for pilot community-owned electricity generation with caps on tariff payouts, was later passed in June 2009. The Midcoast Green Collaborative has a great write-up of the legislation as well as a history of Maine’s slow road towards a feed-in tariff.

For the moment, no concrete, meaningful feed in tariff legislation for Maine homeowners is on the horizon.

Meanwhile, New Hampshire has just passed legislation that will require utilities to pay customers that are net-generators of electricity for their surplus.

The rates to be paid for this electricity are yet to be determined – whether they are truly market rates or a lesser “avoided costs” rate, but should the legislation be successful in spurring renewable energy growth it is possible that true feed in tariff legislation will follow.

We’ll keep you posted as feed in tariff legislation continues to develop in Northeast!

Special thanks to Clean Technica and Renewable Energy World for information about this new NREL report.

More Reading

Learn more about feed-in-tariffs and how other states and countries are using them to move solar energy forward:

• Hawaii feed-in tariff decision to open clean energy market
• Portugal Gives Itself a Clean-Energy Makeover (NY Times)
• Tripling of Solar Jobs in the UK this Year due to FIT?
• Feed-in tariff for alternative energy

As of Earth Day 2010, New Hampshire now offers a state solar hot water rebate program, which averages $1,500 for a typical residential solar hot water system.

This program is comparable to Maine’s existing $1,500 rebate – now it doesn’t matter which side of the mighty Piscataqua you’re on – renewable energy makes more sense than ever!

How the Rebate Works

The rebate is on a sliding scale based on BTU output of the system under peak solar conditions. The average rebate of $1,500 is for a typical family of four – larger systems qualify for up to $1,650 towards a system.

A few piece of fine print – the rebate can only be used for a primary residence in New Hampshire and can only be used for retrofits (no new homes – however, solar hot water for a new home is still a great investment because of the incredible life of the energy efficiency upgrades).

What Does a System Cost?

This new state rebate is in addition to a 30% uncapped federal tax credit. The net system budget for a typical 4-person household looks like this:

$11,000 gross installed cost
-($3,300) fed tax credit
-($1,500) state rebate
$6,200 net investment

Here are estimated payback periods for a 4-person system at different prices for heating oil:

[TABLE=2]

Compared to electric water heating, a solar hot water system will save roughly 3,540 lbs of C02 from entering the atmosphere each year.

Get Started

Curious whether solar hot water is a good match for your New Hampshire home? ReVision is happy to offer a free solar site evaluation is the first step towards securing the state rebate.

In addition to answering any of your questions about solar, we review your home and site and help determine where a solar energy system would fit in. Several pieces of site data are required to qualify for the state rebate and we’ll collect all of those while we’re at your home.

Contact us or call our New Hampshire office (603) 501-1822 for more information.

Janet Ward, a friend of ReVision Energy in Concord, New Hampshire, recently alerted us to some questionable legislation making its way through the New Hampshire State Senate.

Bill SB 334, which states that it is “encouraging the installation and use of small scale renewable energy resources by homeowners and businesses,” is coming under fire because it would allow Public Service of New Hampshire (PSNH) to divert $5 million of money that should purchase renewable energy credits for a single solar development project in Manchester.

As reported from the New Hampshire Sustainable Energy Association:

PSNH is asking the New Hampshire House of Representatives for permission to fund a single solar energy project in Manchester with funds it is supposed to use to purchase Renewable Energy Certificates or pay into the State’s Renewable Energy Fund(REF).

The REF funds are intended to be available throughout the State for renewable energy projects to benefit residents, small businesses, and municipalities. The funds are vital to the small businesses which are building New Hampshire’s green economy.

The PSNH project, funded via the RPS program, undermines investment in New Hampshire’s small business future.

The bit of legislation that is causing the controversy:

In lieu of PSNH making payments under RSA 362-F:10 for class II electric renewable energy standard obligations or purchasing certificates, as defined in RSA 362-F:2, III, to comply with RSA 362-F class II electric renewable energy standard obligations, beginning upon the effective date of this act PSNH shall retain such payments and utilize $5,000,000 of such amounts to invest in the development of the solar photovoltaic renewable energy project in Manchester. The amounts retained by PSNH shall be used to amortize the outstanding capital investment for the project. When the nominal payments retained by PSNH equal $5,000,000, PSNH shall return to routine compliance with RSA 362-F:10 for going-forward class II electric renewable energy standard obligations.

What This Means

Under current law, the $5,000,000 would go towards the purchase of Renewable Energy Certificates (the Renewable Portfolio Standard or RPS) or pay into the New Hampshire’s Renewable Energy Fund (REF).

According to The Green Energy Times, “The REF funds are intended to be available throughout the State for renewable energy projects which benefit residents, small businesses, and municipalities. The funds are vital to the small businesses which are building New Hampshire’s green economy.”

In other words, the act would allow PSNH to create their own special project and avoid the current process, which incentivizes small businesses and entrepreneurs to create renewable energy projects, and drives a competitive renewable energy marketplace.

RPS requires New Hampshire to generate 16 percent of new energy from renewable resources such as wind, solar, biomass and hydro by 2025, and Renewable Energy World predicts New Hampshire’s energy will be 22-25% renewable by 2025 should the effort be successful.

Performance requirements for the PSNH project are not defined in the bill, though there is some verbiage in the Bill that suggests that performance of the PSNH project would be subject to review.

Opponents to SB 334 claim that the RPS program has led to regular employment for 126 electricians and solar installers and grants for more than 270 renewable energy projects across New Hampshire. In contrast, they claim that the PSNH project will create only five full jobs a year, “at a cost of $1 million per full-time position.”

What You Can Do

ReVision Energy encourages you to read about the legislation and then take action – there is a great amount of information as well as links to newspaper articles and opinion pieces at http://www.nhsea.org/public-policy.php.

You can contact members of the New Hampshire House Science, Energy and Technology Committee via e-mail: HouseScienceTechnologyandEnergy@leg.state.nh.us or visit the New Hampshire House website for for complete contact information for the Committee.

Most importantly, you can attend the Committee’s Public Hearing on SB 334, which will be held this Thursday, April 15 at 1pm in room 304 of the Legislative Office Building, 33 North State Street, Concord, New Hampshire (map and directions).

It’s tax time, and while that’s a cause for groans from many, you can be happy if you finished installation of a solar energy system in 2009!

The Energy Policy Act of 2005 was greatly enhanced in February 2009 by the federal stimulus plan, which eliminated a $2,000 cap on the federal tax rebate for solar electric systems. The current federal tax credit for solar hot water and solar electric is 30%, with no upper limit.

Unlike state cash rebates, you apply for the federal tax credit when you submit your regular 2009 personal income taxes.

Here’s a link to the IRS Form 5695 that you’ll need (PDF): http://www.irs.gov/pub/irs-pdf/f5695.pdf.

While ReVision Energy can’t offer you tax advice, we encourage you to read up about the tax credit at DSIRE and consult with your tax advisor about the best way to file for the tax credit.

Also, this act has been extended through 2016, so you have time in 2010 to take advantage of this great incentive!

Contact us with any questions you have about solar rebates.