There are several factors that go into whether or not solar is a good fit for your home or building:
- Does your roof get much sun exposure?
- What’s the condition of your roof? What material is it made of?
- Does solar make sense for your budget?
- Is your building energy efficient?
The first question should always be whether your building is energy efficient. Energy efficiency upgrades should always precede or accompany solar investments. These are often very cost effective, but less in vogue than solar electricity. They include lighting upgrades and replacing refrigerator and other equipment or appliances with more modern and efficient products.
Next, do a solar spot check on your own. Is your roof shaded by trees or other buildings? If your roof is sloped? Is there a south-facing slope? If there is an uninterrupted southern exposure, your home or building may be ideal for solar PV.
What incentives are available?
There is a 30% federal investment tax credit (ITC) for solar energy systems in place until December 31st, 2016. Both residential and commercial customers can take advantage of this tax credit. This credit has been extended through 2020, but the credit rate will reduce each year.
In addition to the federal ITC, many states, counties, municipalities and utilities offer rebates or other incentives for solar energy technologies. Iowa is currently offering an incentive tax credit for half of the federal credit toward the total project cost, with limits of $20,000 for commercial and $5,000 for residential systems.
For Iowa residents, the federal and Iowa state tax incentives combine to offset 45% of the cost of a residential solar PV system. Individuals receive this credit in the form of a tax break, which reduces tax liability. This tax break can be taken all at once or spread out across multiple years.
Commercial and agricultural customers can also depreciate their arrays for additional tax benefits. The amount you can depreciate depends on your tax bracket. Solar is eligible for a 5-year recovery period.