An Objective Look at a Selection of Incentive Programs for Residential Solar Power Systems

There are some notable incentive initiatives by both local state and federal governments to encourage the installation of residential solar power systems. The efficacy of these programs has been instrumental in driving up demand for solar as well as other options of renewable energy solutions.

Residential customers can benefit from these offers in 3 distinct ways. They include net metering, feed-in tariffs as well as Building Integrated Photovoltaics (BIPV) type of incentives. The following is an account of how each of the options can be made to work for optimal effect in your domestic renewable energy project.

Options in FIT Programs

Even though feed-in tariffs are an idea that has been in operation for well over three decades it only very recently that it has been integrated to a large scale in utility grid power supply programs. In fact, in many areas it is considered more like an experimental undertaking rather than a mainstream idea in operation of energy supply systems. The efficacy of the system lies in the fact that independent power producers, including small scale domestic power producers, are afforded the chance to gain substantially from these arrangements.

The federal government sanctioned the operation of FITs way back in 1975 as a deliberate policy aimed to encourage the private sector and individuals to join state bodies in generating electricity. This was seen as an apt response to the implications of the Oil Crisis. The most iconic piece of legislation that formed the backbone of this policy is the PURPA (Public Utility Regulatory Policies Act). While some lauded it as visionary, there are those who still feel that it remains excessively burdensome on ordinary electricity consumers in a bid to gratify renewable energy producers.

Benefits From Net Metering Programs

There are those who mistake the concept of feed-in tariffs with net metering programs but there are subtle differences between the two. Unlike FITs, these programs are not available for systems without an on-site load such as solar farms. Net metering programs are expressly aimed at domestic producers who have installed alternative production systems with an equal or lower capacity than what their site demand load is. They are meant to provide a platform for homeowners who want to earn incentives for installing renewable energy solutions at homes. They are not meant for anyone with ambitions to sell power to the utility providers.

The Energy Policy Act of 2005 was instrumental in giving options that helped propel net metering program growth. This act made it mandatory for all public utility companies to provide net metering equipment to customers who demand for it. The development of Time of Use (TOU) net metering technology further gave a boost to the development of these arrangements.

Incentives Offered for BIPV Homes

Building Integrated Photovoltaics (BIPV) is a relatively recent albeit revolutionary concept that has seen a considerable rise in the number of solar power homes. Initially the technologies involved were too costly for a vast majority of homeowners to afford. This is why perceptions were that BIPVs were only for corporate solar power producers.

In the United States, the offers given for residential solar power systems that make use of BIPV vary from state to state. Other than zero rating of the tax due to those who buy the materials used, there are incentives that give considerably higher kWH compensation if a BIPV home has a feed-in program integrated.


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