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Creative Financing Gives Solar A Boost

(An excerpt taken from the Venice Gondolier Sun By Greg Giles, ggiles@venicegondolier.com, News Editor – June 1, 2008)

Having reauthorized Florida’s solar rebate program and adopted a new net-metering rule that requires utilities to deduct from a bill the electricity generated by those using their solar systems – at nearly the retail rate, Congress is now debating whether to reauthorize its $2,000 tax credit incentives.

The substantial incentive makes “going solar” less expensive.  Some consumers say they’ve recouped almost 50 percent of the cost of solar photovoltaic systems from these incentives.

But is it enough?

Everyone knows a solar system eventually pays for itself, unlike most big ticket items like your car or refrigerator or air conditioning unit.  Yet the up-front investment can be substantial. It’s the hill most consumers have difficulty climbing.

Those who can afford an outright $20,000 to $40,000 purchase can realize significant saving immediately.

For the vast majority, however, this kind of home improvement requires a loan.

Solar companies are coming up with new and creative financial arrangements to help consumers do just that.

Tom Harriman, of Harrimans Solar Inc., handles most of the solar rebate and federal tax credit forms for his clients.

When it comes to consumers who need to finance a solar purchase, Harriman puts them in contact with companies like Solar Financing LLC in Osprey.

“They have several programs that work well,” Harriman said.  The cash programs take car of the state rebates and federal tax incentives. The loan programs are essentially home equity loans specific to solar, he said.

“The solar financing was for increased affordability.  We see folks taking advantage of this.  The payback is three to five years for a solar hot water system.  That’s the no-brainer part of this.

“With net-metering going into effect and the property tax exemption rule that’s  going to be reinstituted (property taxes won’t go up because a solar system is installed) it’s never been more affordable, Harriman said.

Sold and saving

Venice resident Philip Myers, a retired contractor, was sold on “green building” long ago.  But it wasn’t until he moved to Florida that he got serious about the solar aspect of green building.

“I wanted to take energy efficiency to a new level,” Myers said.
 He did.  The proof is his monthly Florida Power and Light bill – a whopping $8.12 last month.

Last year he installed a solar hot water system and a photovoltaic system hooked up to the electrical grid.  The system price was $34,000 for a 3-kilowatt system.  State and federal incentives brought the price down to only $14,000, which he took from his retirement savings.

“The amount of discounts and tax credits caused us to make the decision to move on it,” Myers said. “After all those refunds, we spent only 42.5 cents on the dollar.  At that point it was like buying a small car.”

After that Myers was hooked.  He began monitoring his usage online.  He noticed how greatly it reduced his electric bill – and decided to push the green envelope further.  He put in additional insulation in the home, added insulated windows and UV protection to further reduce the electrical load.

His family began “doing some lifestyle stuff, like not leaving lights on and using compressed fluorescent bulbs throughout the house.”

The family now washes clothes on sunny days instead of in the evening when it would require using electricity from the utility grid.  Same with the dishwasher.Without the solar systems and lifestyle changes, he estimates his bill would be between $130 and $150 per month for his 950-square-foot manufactured home. “We are pretty conservative.  When we saw 42 cents, in the end it made sense.”