A unique program in St. George, Utah, provides residents with green power, tax credits, and an opportunity to own shares in solar infrastructure—without having to install panels oWhat Happened
In 2008, construction began on a solar farm that would provide solar electricity to consumers with no set up, no maintenance and no risk. The result is a unique program in St. George, Utah, providing residents with green power and tax credits.
How it Works
The city’s electric utilities built the photovoltaic facility to enable residents to supplement conventional energy with solar power. Instead of asking residents to install solar panels on their homes, the solar farm ostensibly enables residents to own shares of solar power.
The SunSmart program can provide enough solar power for 26,272 homes, helping to avoid more than 1.6 million pounds of carbon dioxide output. Through SunSmart, customers living in St. George can purchase units of solar kilowatts (kW). Each “unit” is the equivalent of about 140 kilowatt hours of electricity per month for the minimum life of the program (estimated at 19 years). The kW units costs $5,000 and can be rewarded with an income tax credit of 25 percent of the purchase price, up to $2,500; if more than one unit is purchased, the maximum tax credit could be reached.
Consumers who purchase SunSmart also receive a monthly energy credit on their utility bill based on the amount of energy actually generated in a particular month by the unit they own. The value of those energy credits can increase if the price of electricity increases.
Why a Solar Farm?
According to SunSmart, there are several benefits to solar programs that do not require individuals build their own home solar arrays:
- Costs: Building a large solar project lowers the initial equipment and operating costs, making sustainable solar energy a more affordable choice.
- Maintenance: The city’s electric utilities will maintain the plant, eliminating the time, effort and expense to maintain an at-home solar-powered system
- Sustainability: SunSmart participants will support environmentally-friendly power generation and sustainable energy in their local community.
- Credits: The City worked with the State Legislature to make it possible for homeowners to receive state tax credits for renewable energy investment not on the homeowner’s own property. St. George is the only city that currently offers a program that takes advantage of this tax credit for an off-site system.
Similar Successes
Other cities are going the same route, recognizing their ability to provide the demand many homeowners are seeking. In Berea, Kentucky, Berea Utilities began offering leases of 60 photovoltaic panels in its solar farm to local residents. Each lease costs $750 per panel. The lease covers a 25-year period, with owners receiving a credit every billing period for electricity generated by their panels. The cost per watt is only $3.19. As leases come in, the utility will use that money to add to the solar farm. In just four days, Berea sold out of leases for its first farm, which went live in 2011. Phase two sold out of its 35 panel leases.
Likewise, the Poudre Valley Rural Electric Association in Fort Collins, CO, recently completed a 494 panel Community Solar Farm for its customers. Each panel will produce 395 kW hours annually, worth an estimated $35 worth of credits on a customers bill. Each panel has a 50-year lifetime and will save 17 million car miles or represent the equivalent of 23,500 trees planted.