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Delaware solar installations rise in 2019

Incentives and pending tax credit reduction create urgency
May 20, 2019

The year 2019 has solar installers in Delaware working hard to keep up with demand caused by the pending reduction to the federal tax credit.

While the tax credit will only fall from 30 percent of the gross price to 26 percent, the idea that incentives for solar will decrease has people deciding to purchase solar this year.

Solar installation company Clean Energy USA of Rehoboth Beach has seen its installations rise by 80 percent through April 2019, in comparison to 2018. “Our installers are working really hard this year to keep up with the demand. We usually have a significant lull in the late winter, but this year has been different,” said Megan Spangler, vice president of operations at Clean Energy USA.

While some feared that political shifts might cause the solar tax credit to be eliminated altogether, with the 2018 Bipartisan Budget Bill, the federal government ensured that homeowners who invest in solar (and other sources of renewable energy) get reimbursed. After 2019, credits will be reduced each year before they go away entirely at the end of 2021.

Delaware lawmakers have also made sure that incentives to help the environment and encourage renewable energy development have remained in place. There are still state grants and other incentives in place to help offset the cost of consumers’ solar purchases.

“Delaware has been a bright spot for renewable energy policy around the country. They have done a great job encouraging renewable energy growth without new taxes and with minimal impact on ratepayers. It is popular among members of all major political parties and supported by Delaware’s forward-thinking lawmakers,” said John Sertich, president of Clean Energy USA.

Legislators know that by increasing the country’s usage of cheaper, renewable energy, they’ll ultimately start to drive down overall energy prices, saving money for consumers, companies, and cities alike. More expensive forms of fuel like coal become increasingly obsolete as renewable energy sources become more accessible. But even as the industry grows, with solar currently accounting for less than 2 percent of the country’s energy consumption, there’s a long way to go before these benefits will be fully maximized. Conventional forms of energy will continue to be costly to produce and expensive to consume.

The cost of electricity to utilities fluctuates with demand, typically driven by seasonality such as summer’s high temperatures. When everyone in the community is maxing out their HVAC system to keep their house cool, power companies are squeezed and must spend (and charge) more to meet demand. Solar eliminates the volatility of energy prices in 2019 and beyond.

Fortunately, the price of electricity becomes less significant to customers with solar because their power is coming from sunlight – a free and renewable resource. With solar panels, they’re generating their own power and purchasing less from the electric utility. And because solar panels last for decades, this means they go up in value over time as energy prices rise.

The economic benefits for solar customers in Delaware go even further. Motivated to increase the state’s demand for and production of renewable energy, Delaware’s lawmakers enacted a program called net metering. This allows the electric meters on solar-powered homes and businesses to spin backward when they are generating more electricity than they currently need to consume. That excess energy is sent back to the community power grid, and the solar customer earns a credit on their electric bill. Perhaps that means that the power they’re generating during daylight hours simply offsets the power they’re consuming at night. But either way, they only pay the net amount of their solar consumption. And at the end of the month, they’ll see a negative power bill if they’ve produced more electricity than they’ve consumed.

Saving energy and protecting the environment are important, and reducing carbon emissions is critical. In fact, Delaware state laws mandate that utilities derive 25 percent of their energy portfolios from renewable sources by 2025. But the real power of solar comes down to economy. Using the sun’s free and abundant energy means electric bills are drastically reduced, if not eliminated altogether. The state and local utilities have teamed up to provide rebates and grants to solar customers, offsetting even more costs. And the federal government provides that 30 percent tax credit ... but only for a few more months. This is the year for Delaware residents and business owners to reap the economic rewards before they’re gone.