Colorado Solar Power Rebates, Tax Credits, and Incentives

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Colorado Solar Tax Credits and Rebates

Updated 1/25/09 -
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In 2004, Colorado clean energy advocates were the first in the country to ask voters to pass a ballot initiative creating a state-wide renewable energy portfolio standard. The RPS required 0.4% of the state’s power to come from solar by 2015. The vote succeeded. While four tenths of a percent may not sound like a whole lot, this legislation was a groundbreaking victory.

The state of Colorado enacted legislation (SB 145) authorizing counties and municipalities to offer property and sales tax rebates or credits to home and business owners who install renewable energy systems.

Eligible renewable energy property is defined as “any fixture, product, system, device or interacting group of devices that produce electricity from renewable resources, including, but not limited to, photovoltaic systems, solar thermal systems, small wind systems, biomass systems, or geothermal systems.”

The program is administered at the local level by individual cities and counties. Our solar experts have all the details about tax rebates and local tax credits for your municipalities. If you prefer to do the digging yourself, you may find the following links helpful:

Web sites for many Colorado cities can be found at the Colorado Municipal League website, www.cml.org.

Websites for Colorado counties can be found at the Colorado Counties, Inc. web site, www.ccionline.org.

If you live in Aspen, check out our Aspen page.

Business Energy Grants

Holy Cross Energy, a Touchstone Energy Cooperative, has developed a voluntary carbon reduction strategy designed to slow the growth of carbon dioxide emissions created in the generation of electricity. It offers its industrial and commercial members an energy efficiency grant which can pay for up to half the cost of a professional, engineering grade energy use evaluation of your business’ facilities, or up to half the cost of actual labor, equipment and/or material costs to install energy saving measures identified in an energy evaluation.

More details and grant application forms are available on their website under Green Programs at: www.holycross.com.

Residential Solar Incentives

Amendment 37 set the stage for sweeping changes to solar regulations in Colorado. Since the vote, state advocates successfully increased the net metering limit to 2 MW (equal to the country’s best standard established in New Jersey). The interconnection process has also been streamlined for systems up to 2 MW. As a result of Amendment 37, Xcel Energy has established a huge residential solar rebate program and will soon begin its commercial solar program.

The rebate you can take advantage of right now as a homeowner is $4.50/watt. The average cost per watt installed in Colorado is about $9.00, so you’re lined up to save about 50% off the cost of your system with this rebate. This is a huge sum of money. For specific explanations of how this would pencil out in Colorado, request to be contacted by one of our personable solar experts. Here’s a video explaining more details.

A representative from REC Solar explains how the rebates work in Colorado

Since it is so cool and relative sunny in Colorado, a 5kw solar system will knock out roughly 900 kWh of electricity per month – lots more than similarly sized systems in other areas of the country. A system this large will probably run about $40,000 to install. This may seem like a lot of money. However, subtract the 30% federal tax credit and we’re at $28,000. Now, subtract the Xcel energy incentive ($4.50 x 5000 = $22,500) and we’re left with a net cost of $5,500! When you finance that remaining sum, we find after working with our experts, Coloradans are able to pay even less monthly for electricity than they were previously without solar. Now you can see why Colorado gets our highest rating! Get in touch with a Colorado solar expert to lower your monthly bill!

Still feel like you need more reason to be contacted by a solar expert for more information? Sure, here’s some: In January 2007, the average price of electricity in Colorado increased to $0.10 per kWh. Since average usage here is about 1200kWh per month, we’re talking about a $120 monthly power bill. In January 2008, Xcel raised rates again by nearly 10% to $0.109 per kWh. Power bill then at the same usage = $130.

Just recently, Xcel announced the 3rd major rate increase in 18 months by raising rates by over 10% once more. The average residential electricity rate is now $0.12 per kWh. The power bill for the same usage is now $144 a month – an increase of roughly 20% over 2 years!

Check out the chart below. If electricity were simply to increase at a rate of 5.5% for the next 20 years, we’ll be looking at a $0.39 kWh charge for electricity from the utility. Our power bill for 1200kWh of usage will now total a whopping $468. Don’t think it can happen? Think again. Utility rates in Colorado have been increasing at 9% per year over the past 10 years. It is happening already.

Now more than ever is the time to get moving on solar energy in Colorado. By producing your own energy, you no longer have to worry as much about utility rate increases.

By producing your own power, not only can you reduce or eliminate your bill, but the value of your property will increase by 20 times your annual utility savings. Think about that for a second. Let’s say you save $100 a month by installing solar panels. That means your property will increase in value $24,000. Not only that, but this property value increase is tax exempt. It’s like adding an additional bathroom, heater, or living room onto your home without the property tax increase! The more electricity prices go up, the more valuable your investment becomes as well.

To get a more accurate picture of how solar would work on your home and cut into your power bill, have one of our personable Colorado solar experts contact you. They’ll discuss your roof options, outline shading concerns you may have and show you exactly how the federal, state, and utility incentives work. They’ll even tailor a solution for you.

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