State solar subsidies fall victim of downturn

State and local governments are slashing tax credits for solar arrays.
Written by David Worthington, Contributor

If you were planning on covering the cost of decking out your house in solar panels with a tax credit, you should take pause before you act. Many state and local governments in the U.S. are cutting back or eliminating programs that incentivize clean energy to make up for budget shortfalls.

Today, Scientific American published a roundup of rebate programs that were either suspended or cut – from Arizona to California, Florida, Massachusetts, New Jersey, and Pennsylvania. The subsidies are provided to help cover the upfront costs of purchasing solar arrays. Oregon reduced its tax credits earlier this month.

In Florida, one family had the cost of its solar array added to their property's assessed value, and were given a tax increase for going green. An existing state tax incentive for installing renewable energy systems was recently repealed when Florida voters approved a constitutional amendment that was intended to promote renewable energy.

The state Legislature passed nothing in its place, and owes approximately $US40 million in outstanding rebate checks.

In New Jersey, a trade association that represents solar contractors filed suit against the state in May for taking money from a ratepayer's fund without replenishing it. The suit alleges that the state acted unconstitutionally.

However, there is at least some upside for homeowners: Scientific American notes solar arrays are becoming more affordable over the long haul. The articles notes that costs are offset by the higher market value of the tradeable credits that homeowners receive for the solar power that they generate, and that the average price of an array has dropped by a third over the past several years.

This post was originally published on Smartplanet.com

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