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View Diary: Koch, ALEC and giant utility company about to derail Arizona's private solar industry (184 comments)

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  •  Small PV subsidies, continued (1+ / 0-)
    Recommended by:
    catilinus

    3)Again, the decline or disappearance of direct utility subsidies (rebates), does not imply that strong subsidies are not still in place.  While specifics differ by state, utility, and locality, here are some examples of continuing subsidy (cash back or reduced outlay comapred to projects in the general economy):

    A)30% federal tax credit
    B)State tax credits (varies, but AZ is 25% up to $1K for residential, or 10% up to 25K for a commercial building)
    C)Exemptions from sales and property tax in many jurisdictions
    D)Exemptions from building permit costs in many jurisdictions
    E)Exemptions from utility interconnection upgrade costs in many jurisdictions
    F)Net metering in most jurisdictions

    •  Additional commercial subsidies (1+ / 0-)
      Recommended by:
      catilinus

      50% bonus depreciation (has been renewed each year, but currently expiring at year end) and special basis treatment (only half of 30% rebate must be deducted from depreciation basis).

    •  Utility upgrades for small PV (0+ / 0-)

      Why might small PV drive a need for utility upgrades?  Because PV has relatively low 'capacity factor' (the fraction of kwh actually produced compared to production at full kw output 24/7/365), if a PV install is sized to fully offset kwh usage of a typical house or small business, the array must be made large, such that the peak kw output is substantially higher than the previous peak load demand kw.  Because the transformer and secondary conductor serving the load have been installed to serve the load (without excessive thermal load or voltage drop), they may well be too small to serve the PV without upgrade.  This is exacerbated by the fact that load causes voltage drop, but generation causes voltage rise.  The utility system will often be able to allow less voltage rise than voltage drop, since utility voltage ranges are higher than utilization voltage ranges.  Also, because these problems are relatively new to utilities, it is common for needed upgrades not to be identified and performed at initial DG interconnection.  This will usually be even more costly than prompt upgrades, since performance problems and diagnosis time will be added costs.

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