Your 2019 guide to getting solar panels for your home in New Hampshire
This page is a complete guide to the complicated and sometimes confusing process of installing solar panels on your New Hampshire home. Since there's a lot to consider, we've separated the page into sections to help you find what you are looking for. If you find this page useful, please share it with someone who might also find it interesting!
** What's new for 2019 **
New Hampshire is one of those states that got solar right pretty early. The General Court passed a strong Renewables Portfolio Standard back in 2007, and with it came a good statewide rebate program to lower the up-front price of solar. It's now almost a decade later, and the state still has good rebates and high electricity prices, which are the major reasons solar is a great investment.
That foresight is refreshing, considering many states in other parts of the country still don't have concrete plans to back solar power. With good rules and policies in place, solar in New Hampshire makes sense practically and financially. It’s not enough, however, to rest on our laurels.
From the White Mountain National Forest, to the northern reaches of the Appalachian Trail, we have a lot of beautiful places to protect here, and we could be doing more. Read on to discover the potential for home solar in New Hampshire, and see just how the state could improve.
Breaking NewsThe New Hampshire Public utilities commission has approved a new net metering tariff, which means homeowners in the Granite State will be getting paid just a tiny bit less than they used to for their excess solar power. On top of that, the state has suspended solar rebates until at least September, 2017. Both of these changes mean the financial calculations below are no longer correct. New Hampshire can still be a great place to go solar, but it may be wise to take a wait-and-see approach until the end of summer. We'll update this section with any news as it arises.
Questions? Our network of solar experts are on call to assist you. Simply sign up for personalized assistance on our special solar deals page. You can get discounted on-grid pricing as low as $4,000/kW! This is paired with the New Hampshire solar incentives you see below.
The Solar Strategy section is focused on the 3 ways of paying for solar in New Hampshire, so you can decide which is best for you. We've created a tool that asks you a few questions and recommends whether you should pursue a solar lease, loan, or outright purchase. Then, we provide detailed analysis of how each works.
The Policy Information section contains all our latest research on the rules set by lawmakers and the Public Utilities Commission, which determine how easy it is to go solar in New Hampshire. These policies and rules govern everything from renewable energy mandates to interconnection, and have a huge effect on the viability of solar.
Finally, the Solar Incentives section includes information about money-back rebates and grants, tax credits, and tax exemptions for going solar in New Hampshire.
Click any of the boxes below to go to that section of the page, or scroll down to read the page in order.
|Your New Hampshire Solar Strategy|
|New Hampshire Solar Policy Information|
|New Hampshire Solar Incentives|
|Your New Hampshire Solar Strategy|
|Comparing Solar Investment Options|
|Paying Cash for Solar in New Hampshire|
|Solar Loans in New Hampshire|
|Solar PPAs in New Hampshire|
|Solar Purchase Payback Time in New Hampshire|
|New Hampshire Solar Policy Information|
|Renewable Portfolio Standard (RPS)|
|RPS Solar Carve-Out|
Your Solar Strategy in New Hampshire
Figuring out the best way to go solar in New Hampshire can be a little daunting. From loans and leases to power-purchase agreements, there are a lot of options out there. To help you pick the one that might be best, we've created the handy decision tool below.
We'll ask you a few simple questions about you and your home. Once you're done, we'll recommend a good option. Further down this page, we provide cost estimates and example return-on-investment calculations for all the various options:
How to pay for solar panels in New Hampshire
The chart above shows the 25-year returns for an investment in solar whether you choose to purchase a system with cash or pay over time with a loan or lease. One thing it's important to note is: solar makes you a lot of money in New Hampshire. Yes, we said "makes!" You see, New Hampshire's electricity prices are so high, going solar starts paying off right away. And with great rebates and tax credits, solar has never been cheaper.
Now let's discuss that chart above. We've examined three scenarios for going solar in New Hampshire, including a solar Power-Purchase Agreement (PPA), buying solar with a loan or home equity line of credit (HELOC), or paying for solar with cash. As you can see, the cash purchase option leads to the highest dollar-amount returns over time, but look a little closer. Taking a loan and paying for the system over time (the orange bars) means you'll actually spend zero dollars of your own money over time, while reaping a big financial benefit in year 1.
That's because you're paying for the system over time, but you still get all the benefits of paying up front. In New Hampshire, that means a rebate, a 30% federal tax credit, and huge annual energy savings. With those huge tax credits, you'll actually come out way ahead after the first year. And even though you'll be making loan payments for 15 years, the net cost will be so low that you'll never actually spend that first year's windfall.
Finally, take a look at the blue bars. They represent a solar Power-Purchase Agreement (PPA), which are also called third-party ownership. With a PPA, the solar installation company puts panels on your roof at no cost to you, and you make monthly payments that save you a little each month from what you had been paying the utility company. PPAs in New Hampshire are awesome, because the state's high electricity prices mean you start saving money right away. Your savings will start big and finish even bigger, because the lease cost will rise by less than the electric company's annual rate hikes. Third-party ownership is an excellent option even if you have equity or cash to put down, because it can save you tons of money!
Read more below about each of three very good options for solar in New Hampshire.
Option 1: Paying cash for solar
An outright purchase used to be the only way to get solar, and it's still the option that provides the "biggest" financial returns. The reason we put "biggest" in quotes here is because it's technically true—with rebates and tax credits, solar costs less than ever before, and the electricity savings in New Hampshire are so good that a solar installation pays itself off in just a few short years. But if you're interested in solar as an investment, taking a loan to pay for the system is a better option.
With a loan, you can make monthly payments instead of putting $14,000 down on a solar system, which means you save money on electricity as you pay down the cost of your panels. If you have equity in your home or can get a large loan with an interest rate of 4% or less, a loan is the option to go with. It's like being able to start a business that is sure to succeed, just by having a roof. Read about loans below.
If you've got cash and you prefer to pay up front, you'll have to plunk down $14,150, but tax breaks and energy savings will erase a bunch of that after just 1 year. Over 25 years, your system will have produced over $22,600 in income, after your system cost is paid back. The reason this works is that solar offsets your electricity costs—enough to save you $1,053 in year 1—and it just goes up from there. As the electric company raises rates, you save more and more, and more...
Net Present Value: $7,137
Net Present Value (NPV) measures how good of an investment something is, compared to the best alternative. We use a 6% return to evaluate all solar investments, and ew Hampshire's $7,137 NPV on a 5-kW solar system means you'd be that much better off investing your money in solar over 25 years than in, say, stocks. With investment return like that, you'll be padding your wallet while you save the planet. Good job! But check out what happens to NPV if you buy the same system with a loan that you can pay back over time.
Here’s how the numbers work for a 5-kW rooftop solar system in New Hampshire:
- Installing a typical 5-kW solar system should start at about $14,150 after New Hampshire's $500/kW solar rebate. That's cheaper than solar has ever been, but it still might seem like a big investment. Don’t worry, because after tax breaks and energy savings, your first-year costs will be considerably less than that.
- The Federal government offers a great income tax credit of 30% of system costs. That's $4,245 you won't be paying to Uncle Sam this year, and it brings your first-year investment down to $9,905.
- After those tax credits, we subtract your first year’s energy savings, which we estimate to be $1,053. That reduces your cost after the first year to only $8,852—a savings of more than 37% off the post-rebate cost of your system. That's a huge cost reduction!
- Those electricity savings will quickly make your money back, and your system will pay for itself in just 9 years. You'll see a total net profit of $22,614 by the end of your panels' 25-year warranty. The internal rate of return for this investment is an amazing 12.7%. That's about twice the return of an investment in index funds, and it's more reliable, too!
- And here's a nice bonus to consider: your home's value just increased by $24,000, too (your expected electricity savings over 20 years).
- In addition to all that cash (and home value), you’ve created some green for the earth as well by not using electricity from fossil fuels. It's like planting 97 trees a year, every year your solar power system is humming.
Keep in mind, the numbers above are based on an average home in New Hampshire. If you're ready for a custom quote for a solar panel system, our network of experts are on call to assist you. Simply sign up for personalized assistance on our special solar deals page.
Option 2: Using a loan to pay for solar
You don't need $16,000 sitting around to pay for solar. As long as you have equity in your home, you can still own solar panels and reap all the benefits. Heck, even if you do have the cash, getting a loan to pay for solar is by far the best option when it comes to percentage return on investment.
That’s because, in New Hampshire, using a loan to pay for solar is like investing in a business that's sure to succeed, and also earns you a tax break. You'll come out thousands ahead this year, and you'll still see a spectacular profit over the 25-year life of your system. The reason this works so well is that you're paying over time, but reaping all the benefits now. Your yearly energy savings will nearly offset the loan payments, which might sound like it's too good to be true... so let's take a look at the numbers.
A solar purchase like this will make sense for you if the following is true about you and your current situation:
- You can qualify for a solar loan or home-equity line of credit (HELOC) for $14,150, with a fixed rate of 4% or lower and a 15-year repayment period. Don't be put off if you're offered a higher rate. It just means a tiny bit less of the thousands of dollars you'll make with solar.
- You love making money without much risk.
Net Present Value: $7,580
Net Present Value (NPV) measures how good of an investment something is, compared to the best alternative. We use a 6% return to evaluate all solar investments, and New Hampshire's $7,580 NPV on a solar loan means you'd be that much better off investing your money in solar over 25 years than in, say, stocks. That's a huge number, and it shows how getting a loan for solar is so much better than the alternatives. You can rest easy with a solar loan knowing you're doing right for your pocketbook at the same time as you're doing right by the planet!
Here’s how the numbers pencil out for a New Hampshire homeowner who purchases a 5-kW system with a loan:
- Installing a typical 5-kW solar system should start at about $14,150 after the state solar rebate. That's how big your loan will need to be to cover it.
- The electricity you'll save in the first year of operation would have cost $1,053, but your annual loan payments will be $1,256, meaning you would spend $103 on solar this year, but...
- You'll get huge tax break! Uncle Sam will give you 30% of the cost of your system back as an income tax credit, which in this case means $4,245 you won't be paying the Feds this year.
- That huge tax credit means you'll come out $4,042 ahead after year 1, and it's pretty smooth sailing from then on out. Your yearly net cost (electricity savings minus loan payments) for solar will be $187 in year 2, and will turn into yearly profits in 2028, as the cost of electricity rises but your loan payments don't.
- By the time you've paid off your loan in 2031, you'll see yearly savings of more than $1,300. After 25 years, your total profit will be $17,924!
- On top of the green that will stay in your pocket, your system will mean green for the environment, too—97 trees-worth, every year!
Keep in mind, the numbers above are based on an average home in New Hampshire. If you're ready for a custom quote for a solar loan, our network of experts are on call to assist you. Simply sign up for personalized assistance on our special solar deals page.
Option 3: Buying the electricity, not the panels with a Power Purchase Agreement (PPA)
A PPA is a great way to go solar if you haven't got stacks of cash or oodles of equity in your home. With a PPA, it's possible to get solar panels for $0 down and see big savings over 20 years!
As for leases in New Hampshire: the electricity costs here are pretty high—over 33% higher than the national average. That means a PPA saves you money starting on day 1! For now, the payments on the energy produced by a 5-kW solar system should be around $706 per year, but the energy the panels generate will save you $1,053 per year. That's $347 you get to keep in your pocket this year, just for saying yes to solar!
And those savings will only get larger over time. As the utility company raises rates, your lease costs will go up by a smaller amount, meaning you'll see greater annual savings. Over 20 years, our estimate shows a total savings of $10,031. And the best part is the panels will be owned and maintained by the installation company, so all you have to do is brag to the Joneses down the street about your green habits!
Net Present Value: $5,369
Net Present Value (NPV) measures how good of an investment something is, compared to the best alternative, like an investment in the stock market. We use a 6% return to evaluate all solar investments, and since you'll start saving from day 1 with a solar PPA in New Hampshire, a the NPV is totally great! That number is pretty huge for a $0-down investment, so you can rest easy with a PPA in Arizona knowing you're doing right for your pocketbook at the same time as you're doing right by the planet!
Here's a little more about how a New Hampshire solar PPA works:
Keep in mind, the numbers above are based on an average home in New Hampshire. If you're ready for a custom quote for a solar PPA, our network of experts are on call to assist you. Simply sign up for personalized assistance on our special solar deals page.
New Hampshire Solar Policy Information
Ever wonder why solar seems to be everywhere in some states, but not in others? We did too.
State legislatures and public utilities commissions can enact rules to make solar power accessible for everyone. Favorable rules explain why some of the cloudiest states—New York, New Jersey, and Connecticut, are doing so well with solar, and yet some of those with the most natural solar resources—like Alabama, Mississippi, and Georgia—are doing so poorly.
Below is important information about the public policy, rules, and economic reasons that affect your ability to go solar here in New Hampshire:
New Hampshire's Renewable Portfolio Standard
24.8% by 2025
A Renewables Portfolio Standard (“RPS”) basically requires a certain percentage of a state’s energy production comes from renewable sources like solar panels by a specific date in the future. A strong RPS is important because it forces utility companies to promote conversion to renewable energy. That generally means free money for you in the form of solar power rebates and performance payments when you switch to solar.
If you keep up with renewable energy policy, you already know that some states have RPS goals as high as 30%, even 40% production in the not-that-distant future. We’re not quite at that level here, but our RPS is pretty strong! New Hampshire’s RPS, first passed in 2007, mandates that utilities (excluding municipal electric companies) generate 24.8% of total electricity output from renewable sources by 2025.
New Hampshire's RPS solar carve out
.3% by 2025
As stated above, utilities must generate about 25% of their electricity from renewable sources by 2025. That figure also includes a specific carve out of 0.3% generation from solar power. While it's laudable New Hampshire has put together this requirement, point three percent isn't that inspiring compared to what other more progressive states have accomplished.
New Hampshire Electricity Prices
New Hampshire residents pay an average of 20 cents per kWh of electricity. That’s 48% higher than the national average of 13.6 cents/kWh. We know it's annoying how high your electric bill is every month, but that additional cost also reflects an opportunity to save with solar panels. High electricity prices mean big savings when you’re producing your own electricity.
Even with the comparatively high prices here, we still think the cost of electricity is too cheap. Electricity prices are driven down short term by burning dangerous amounts of coal. But as you already know, there are huge long-term costs associated with those short-term savings. When those long-term costs start to really kick in, electricity prices are going to rise and rise (and rise). With New Hampshire as a good example, we can see within the past calendar year that they already have; electricity costs have risen by 2 cents per kWh, a trend we expect to continue. However, you’ll be saving and saving and saving with all that cheap, earth-friendly solar power you’ll soon be producing.
New Hampshire Net Metering
Net Metering requires your utility to monitor how much energy your solar power system produces and how much energy you actually consume, and make sure you get credit for the surplus. The New Hampshire PUC has adopted uniform rules that require all utilities to offer net metering to residential customers. Surplus energy will be applied as a credit to the next month’s bill, and credits can be carried over indefinitely. In addition, customers on the default service plan may elect to receive annual payments for net metering surplus, if the surplus exceeds 600 kilowatt-hours (kWh).
That’s pretty strong, but there might be changes coming soon. H.B. 1116, enacted in May 2016, raises New Hampshire's net metering aggregate capacity limit from 50 MW to 100 MW. The bill also directs the Public Utilities Commission to initiate a proceeding to develop new alternative net metering tariffs. That could spell trouble, as other formerly solar-friendly states have not proven good at coming up with replacement for net metering.
New Hampshire Interconnection Rules
Statewide, but complex
Interconnection in New Hampshire is more of a mixed bag. Utilities may not require customer-generators to perform additional tests, or pay for additional interconnection-related charges. Insurance is not required. That’s great. What’s not so hot is the lack of differentiation between different system sizes. The process for your small residential system is the same as the process for a giant industrial system. That’s needlessly complex and time-consuming, and legislators are missing a tremendously simple opportunity to make the conversion to solar power easier for you.
Of course, if you’d like some personalized assistance, get in touch with us and we’ll have an expert contact you in a jiffy.
Solar Incentives in New Hampshire
Next to high electricity prices and net metering, solar incentives have traditionally been the most important factor for whether home solar power makes financial sense in a state. In the past, some states with otherwise lousy policy had tremendous incentives that drove down the up-front cost of going solar so much that homeowners could save oodles of money even without net metering or a good RPS.
These days, the big incentive most people can get is the Federal Solar Tax Credit that earns you 30% of your total system costs back after just 1 year. State incentives play less of a role than in the past, but some really good ones are still out there, ready to help homeowners go solar and save money before you know it.
Let's see how New Hampshire measures up:
The availability of state solar incentives for residential solar systems was sourced from the Database of State Incentives for Renewables and Efficiency, utility company websites, and the state public utility commission.
New Hampshire Solar Power Rebates
$200/kW statewide (max $1,000), plus $250/kW for NHEC customers
The New Hampshire Public Utilities Commission (“PUC”) runs a statewide solar power rebate program that offers $200 per kilowatt (kW), up to $1,000 or 50% of project costs, whichever is less. All residential systems are eligible for the rebate, but because the maximum incentive is $1,000, that means a de facto cap of 5-kW for the rebate.
On top of the state's rebate, if you are a New Hampshire Electric Co-Op customer, you can get an additional rebate of $250/kW, up to a maximum of $1,375. For our example 5-kW system, the two rebates combine to equal a cool $5,000 off your shiny new solar system.</p?
Keep in mind, these incentives have to be applied for and approved before you begin construction, so get your ducks in a row, or, heck, connect with a local installer in New Hampshire and have them do all the paperwork for you!
New Hampshire Solar Tax Credits
No State Income Tax
Since there's no state income tax in New Hampshire, there aren't any solar tax credits to redeem! However, you can still take advantage of the 30% federal solar tax credit (more on that in the 5kw example below).
New Hampshire Solar Performance Payments
New Hampshire does not offer any performance incentives for solar power. Both the utilities and the legislature are missing a prime opportunity for a simple and direct way to encourage enough renewable energy to meet those RPS goals. State legislature would be wise to make a change in this department, as it is easy to encourage people to make a change that will benefit them both in the short term and long term, as performance payments have the ability to do.
Property Tax Exemption
When you install a solar power system, your home appreciates by twenty times your annual electricity savings. New Hampshire allows cities and towns to exempt that increase in home value from all associated property taxes. More than 80 cities and towns in New Hampshire have adopted a property tax exemption for one or more of these energy sources. Here's a full list of the cities and towns that have adopted a property tax exemption for solar power. Don’t fret the details; expert solar installers we partner with will walk you through all the details.
Sales Tax Exemption
No State Sales Tax
This is an area in which us “New Hampshirites” luck out. As residents of the state are well aware of, there is no state sales tax. Many states offer a sales-tax exemption, but residents of New Hampshire need not worry about this.
The consensus on New Hampshire solar power rebates and incentives
Not too shabby at all, but we definitely still have room for improvement here. The strong RPS and the adequate solar power rebate program are a solid start, but we’d really like to see an expanded rebate or a performance incentive program to help push the payback timeframe under 10 years (at the least) before we can give New Hampshire top marks. For now we’ll have to settle for a solid but not spectacular “B” here.