Solar energy systems provide you with an effective way to lower utility bills, but the initial cost of having one installed can be difficult to estimate on your own. There are a number of factors that are involved in determining the cost of a residential or commercial solar energy system. If you’re trying to come up with a budget for one of these systems, take the following factors into consideration. You should also keep in mind that Colorado offers several rebates and incentives to make solar energy more affordable.
Solar Cost Factors
These are some of the factors to take into account when you’re figuring out how much you can afford to spend on a solar energy system. The costs for these systems can vary widely depending on the following:
- Whether you qualify for incentives and rebates offered by Colorado state and local governments and local utility companies
- The average costs of utilities in your local area
- The financing method you choose, such as leasing a system, purchasing one or financing one
- The size of your home or building’s roof, as well as other roof elements
- The amount of energy your home or business uses on a regular basis
- The type of hardware you choose for your solar energy system
Rebates and Incentives
Taking advantage of rebates and incentives offered by the government or utility companies can help bring down the cost of solar energy systems. The qualifications for these rebates and incentives differ, so it’s important to make sure you’re eligible before factoring these into your budget. Keep in mind that some of these also expire, although new ones are often introduced as more and more homeowners and businesses in Colorado make the switch to solar energy.
- Federal incentives: The federal government offers a residential income tax credit on renewable energy. With this credit, you can save 30 percent on the cost of your solar energy system. This incentive is set to expire at the end of 2016, although there is a chance that it could be renewed.
- State incentives: Colorado’s state government offers state loan programs, including a Direct Lending Revolving Loan Program for businesses and an Energy Savings Mortgage Incentive for New or Existing Homes for homeowners. These incentives help homeowners and businesses pay for the initial costs of investing in solar energy systems.
- Local incentives: City and county governments throughout Colorado, including Boulder, Denver, Roaring Fork Valley and Eagle Valley, offer local grant, loan and rebate programs, such as the Denver Energy Challenge for Businesses and the Renewable Energy Rebate Program. The qualifications and amounts for each of these varies.
- Utility company incentives: Utility companies in Colorado offer loan programs and rebate programs to help more homeowners and businesses save money on installing solar energy systems. Some of these include Xcel Energy’s Residential Energy Efficiency Rebate Program and the Southeast Colorado Power Association’s Energy Efficiency Rebate Program.
- Sales tax incentives: Some cities in Colorado, including Boulder, offer incentives on sales taxes for those who install solar energy systems. These include the City of Boulder’s Solar Sales and Use Tax Rebate.
- Property tax incentives: Property tax exemptions for Colorado homeowners and businesses are available for those who qualify. The state offers property tax exemptions for residential renewable energy equipment and community solar gardens.
With all of the factors involved in estimating the cost of solar energy systems and the wide range of incentives and rebates available, it’s important to have a reliable solar installation company assist you. ARE Solar can provide you with an estimate for your home or business and information on available incentives and rebates.