Solar thermal systems have been around for over 100 years and remained a cost effective alternative to gas and electric bills around the world…. except the U.S. The bust and boom of solar incentives in the 1980’s decimated the U.S. solar hot water industry, but after 30 years, solar incentives are back…. at least for now.
Recently, a number of states have implemented solar hot water incentives for businesses, such as hotels, apartment buildings, restaurants, laundry mats, car washes, etc. Each state has its own policy and every business has different needs, so the net costs will vary. Use our solar thermal cost estimator to find out your costs, or check out a sample of commercial solar thermal rebates in these states, below.
- Arizona: Commercial buildings are eligible for a 10% tax credit of up to $25,000 for one building, or an aggregate of $50,000 per customer in one year. The Phoenix based APS provides a performance based rebate, which can range between $0.051/kWh-equivalent and $0.07/kWh-equivalent, up to 50% of total system cost. Other utilities in Arizona have their solar water heating incentives, as well.
- California: Natural gas heated commercial or multifamily buildings up to $500,000 towards the cost of a solar thermal system.
- Hawaii: State rebates for commercial installations add up to $125 per deferred kW, plus $0.05/kWh for retrofits. In addition, businesses can receive a state tax credit of 35% of the actual cost or $250,000, whichever is less. Hawaii businesses also get a 100% real estate tax assessment exemption for the new solar hot water system. Your business may also qualify for specific utility rebates as well, such as Kaua’i Island Utility Cooperative (KIUC) which pays for 50% to 80% of equipment costs.
- Florida: In Florida, commercial buildings and apartment buildings receive 15 per 1,000 BTU/day for solar hot water installations, up to $5,000. In addition, Florida has long exempt any sales tax for solar thermal systems.
- Texas: Businesses get a 10% corporate tax deduction based on amortized cost. All Texan companies are also free of any property tax assessment from the new solar hot water equipment. In addition, each utility has their own rebate program.
- Pennsylvania: Pennsylvania’s new Sunshine solar program provides businesses a rebate up to 25% of installed system cos, to a maximum rebate of $20,000.
- Maryland: The Maryland Energy Administration (MEA) is giving mid-size commercial and industrial companies a solar hot water grant of 15% of installed cost up to $25,000. The solar thermal system must be at least 100 square feet in size. Businesses may also qualify for an additional state rebate of $2,000.
- The Federal Government. Finally, in addition to all of the above, the U.S. government provides all businesses a 30% Federal Investment Tax Credit that is calculated before any state or local incentives, but subject to being taxed as income.
America is finally becoming serious about incentives for solar thermal systems for businesses. However, please keep in mind that these incentives are always subject to available funding. Sometimes utilities or states run out of rebate money due to high demand. Check with a local free hot water installer to find out what programs are currently available in your area.