Alaska State Solar Power Rebates, Tax Credits, and Incentives
STATE LEGISLATION
Alaska’s largest electric utility company, the Chugach Electric Association, recently installed and is operating a fuel cell system for the U.S. Postal Service. The one megawatt system is the largest commercial fuel cell installation in the nation, and marks the first time that such a system has been hooked up to an electric utility’s grid. Aside from that one event, Alaska has a very low profile in the promotion of alternative energy.
State legislators have no profile at all, particularly with regard to solar power. Alaska is the final frontier, and remote settlements mean many homes are built off-grid. Rising fuel costs are an added reason for the state to adopt aggressive measures to promote solar use by its residents. Having failed to provide such measures, Alaska’s Solar Legislator Score is “Pathetic”.
STATE INCENTIVE PROGRAMS, UTILITY REBATES, UTILITY LOANS, and UTILITY INCENTIVES
The Golden Valley Electric Association - Sustainable Natural Alternative Power (SNAP) Program serves about 90,000 residents in and around Fairbanks. Commercial, industrial, residential, nonprofit, schools, agricultural, and institutional GVEA customers are eligible for production incentives on solar thermal electric, photovoltaics, wind, and biomass installations. Systems up to 25kW in size qualify, but must be used exclusively for the generation of power sold to the utility; compensation is in the form of an annual payment. Program details: SNAP.
Loans to local government, municipal utility, and independent power producers are available through the only state solar incentive: the Power Project Loan Fund. Applicable to solar water heat, solar space heat, solar thermal electric, photovoltaics, wind, renewable transportation fuels, and municipal solid waste, the program is designed for the development or upgrade of small-scale power production facilities, conservation facilities, and bulk fuel storage facilities. Maximum loan amounts are determined by the amount of available funds in the program. Statutes and regulations are available here.
EXAMPLE RESIDENTIAL SOLAR INSTALLATION
If Alaska, our 49th state, were a sovereign nation, it would be the 19th largest in the world. There are a lot of wide open spaces to accommodate its sparse population of about 600,000 – an average of just slightly less than one square mile per inhabitant. Since Alaska is our northernmost state, it is also the coldest; nevertheless, the Alaskan skies provide plenty of sunshine for a solar energy system. Contrary to what some might assume, solar electric (photovoltaic) power is totally viable in Alaska (with the exception of a 3-month period in the dead of winter when efficiency is reduced by short daylight hours and a low angle of solar radiation).
We’ll look at a solar installation in Metro Anchorage, where about half the state’s population resides. Alaska’s high electrical rates but low usage produces an annual utility bill roughly equivalent to the national average; however, an array of solar collectors on a roof area of 450 square feet could produce enough supplemental power to cut that bill in half. A solar electric system would cost approximately $40,500 (midrange estimate for equipment and installation costs). Offsets include:
- Federal tax credit: $2,000
- Est. increase in Property Value: $8,700
- Est. 25-year Utility Savings: $18,253
- Est. greenhouse gas (CO2) saved over 25-year system life: 82.0 tons
CONSENSUS
It is quite apparent that the preceding numbers do not add up to a lot of encouragement for Alaskan homeowners to install solar energy, something which reflects on the lack of legislative priority. Not even Net Metering is available in the state. While there may be nearly a dozen other states that have similarly dropped the ball, Alaska’s leadership should look to the dozen or so more progressive states that have implemented many successful solar energy initiatives. In other words, Alaska, the performance bar is on the ground; pick it up and place it high.
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