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City of Palo Alto Increases Solar Water Heater Rebate

A big solar thermal rebate program for a small California City

The City of Palo Alto’s municipal utility has followed through and essentially matched the solar hot water rebate amounts under California’s CSI Thermal program. Home to Stanford University and the heart of Silicon Valley, the utility is following the lead of California’s three major utilities (PG&E, SCE, SDG&E), which recently increased their solar hot water rebates by 45% for residents and 13% for commercial applications.

As with the CSI Thermal program, Palo Alto single-family residential customers with existing natural gas hot water systems will receive $18.59 per therm displaced by the solar thermal system, up to a maximum of $2,719.

Based on the above per therm rate, the average rebate will be about $2175 for a two-collector solar hot water system for a family of four to five. The actual rebate amount will depend on many factors, including the equipment purchased and the amount of sun that can potentially hit your roof. The more the system can potentially produce, the higher the rebate.

The same variables hold true for multi-family (duplexes, condos, apartment buildings) and commercial applications such as hotels, restaurants, laundry facilities, and nursing homes, although the per therm rate is lower.  These owners will receive $14.53 per therm of natural gas displaced.

There is one significant difference between the Palo Alto program and CSI Thermal program: Palo Alto commercial customers can only receive a maximum rebate of $100,000. That’s not as generous as CSI Thermal program, which will give commercial projects a maximum of $500,000 for the incentive.

As with any sate program—regardless of utility—homeowners and commercial owners will receive an uncapped 30% Federal Investment Tax Credit (30% ITC) off the installed cost of the system. The calculation varies, so see the above link for more information on how to calculate this tax incentive and get a link for the IRS tax forms.

Another common solar thermal rebate requirement that Palo Alto is adopting is that the solar hot water equipment must be certified by the Solar Rating and Certification Corporation (SRCC). For residential solar thermal systems, that means the system must have the SRCC OG-300 certification.

Larger commercial projects only need the solar panels (or solar collectors) to have SRCC OG-100 certification. However, Free Hot Water does have pre-engineered OG-100 kits that make systems almost as easy to install as the OG-300 kits.

While Free Hot Water is not an installer, we do have a new pilot program for Northern California where homeowners can purchase an OG-300 system and blueprints directly from us at a discount. We can then refer you to one of our Certified Free Hot Water installers, who will install the system at a pre-negotiated price.

For more information on this program for the City of Palo Alto service area, pleae contact breene@freehotwater.com.

This entry was posted in 30% Investment Tax Credit, CSI Thermal Program, OG-100 Solar Hot Water Collectors, pre-engineered solar thermal systems, Residential Solar Hot Water, Solar Rebates, SRCC OG-300 solar systems. Bookmark the permalink.

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