Solar Panels?

"Cap and Trade" and other items are coming up all the time now along with "Carbon Footprint". Coal is dirty, nuclear power is dangerous, oil is polluting, etc - we are constantly hearing the tirade of how our power consumption is polluting this world and leading to Al Gore's climate change.

Recently the utility companies have been under pressure to obtain alternative energy sources that are renewable (hydro, solar, wind) and so they began offering incentives. The federal government has decided not to tax any purchases of this kind and the state of Arizona has followed suit. In addition to not taxing the equipment and the install, Arizona is giving up to $1000 in tax credits and Uncle Sam is giving 30% of the cost back in credits too. To sweeten the pot they gave us 5 years to claim these credits. Now this isn't like a child tax credit so you'd need to get your tax advisor's take on this as it is possible to not realize all of the credits you are eligible for.

Now with some improvements in PV (Solar Panels) and the cost of equipment and installation going down somewhat, it seemed like the best time to pounce before incentives decrease. So we have hired a company to install a 5 kilowatt hour system on our roof. It costs around $25K. SRP is reimbursing us up to the 5 kWh level at a rate of $2.15 per watt or $10,750.

So the breakdown of my costs is about $5,800 after I realize my tax benefits. So 5 years ROI. I was given an 18 month interest free loan that we are going to pay off before earning any interest and our electric bill will go down an average of $100 per month. If we make more power than we use than a credit is created on our meter as it will actually run backwards if we put energy out on the grid.

So I'm excited. I know there are a few things that may become major obstacles; some things will be a bigger issue than I have accounted for, and some things will be better than I imagined. I'm looking forward to having this bad boy installed and start reaping the benefits financially . . . and if I happen to be doing something "green" in the meanwhile then I can feel good about that too.