The Louisiana Legislature and Governor have recently passed legislation expanding the existing 50% tax credit! The new act, Act 467, closes a loophole in the pre-existing state tax credit and allows people other than the homeowner to take advantage of the incentive.
That’s very exciting news and it means that homeowners will be able to go solar with paying the upfront investment. Leasing options and power purchase agreements will soon be available in the New Orleans, Louisiana residential solar market. Because the tax credit is now transferable, third party entities such as installers, developers, and financiers can purchase solar energy systems, receive the tax credit, and then be able to lease the systems to homeowners. Homeowners can then pay a bill to the system owner, in the same way that they currently pay a bill to the utility. The new bill through the lease or power purchase agreement is lower than the the existing bill. The homewoner is also getting the added environmental benefit of running their home on solar energy instead of using electricity.
Historically this was only done on large commercial systems over 100 kW in size. Since it’s a monthly charge for electricity, the economics are very simple to evaluate, and if it’s cheaper than your electric bill then it’s a no brainer. This is making residential power purchase agreements very popular given that the relatively high capital cost is often the biggest drawback to going solar.
In short, the leasing/power purchase option makes installing solar panels on your home more attainable than ever – the panels are on your roof and you use the energy, but you don’t have to pay the big bucks out of pocket.
This new bill is clearly another step in the right direction toward government encouragement and promotion of solar energy. The 50% state tax credit can be combined with an additional federal solar tax credit, which can be as high as 30%. Bascially, all of this means that it’s a great time to go solar in Louisiana.
If you have questions about solar leases or power purchase agreements, just ask and our solar expert will give you more info.
June 4th, 2010 at 2:49 PM
can u have more than 1 system per home
June 4th, 2010 at 5:08 PM
Hi Kevin,
Yes, you can have more than 1 system per home. The tax credit available for solar in Louisiana does limit the total size of the system(s) in a given household to 25 kW and the maximum credit available for a given system is $12,500, but multiple systems are permissible within those limits.
October 26th, 2010 at 8:05 PM
Is the federal tax credit transferable?
February 21st, 2011 at 2:31 AM
are lease or power purchase agreements available in louisiana now, in 2011?