Incentive Program for Photovoltaic Panels Restructured Following Unprecedented Demand for Renewable Energy Installations
October 13, 2009
Amount of Incentives Provided By NYSERDA Increased 64 Percent Over Last Year, While Number of Contractors Increased by 60 Percent
The New York State Energy Research and Development Authority (NYSERDA) today announced that in response to an unprecedented demand for photovoltaic panels, it is restructuring its incentive program for installation of photovoltaic (PV) panels to prevent depleting available funds and disrupting the installation business while still providing a substantial inducement to install PV panels. This change also will lead to an increase in the renewable electricity generated through the program with the available funds.
The restructured incentive plan, which represents a reduced amount of funding for each individual project, will continue to reimburse customers for approximately 30 percent or more of the installation cost. Furthermore, because tax incentives remain in place and the cost of systems has declined and is projected to continue to decrease, the cost to most customers is not expected to be materially affected by the new incentive structure.
"Over the past year, the demand for photovoltaic systems has soared as more individuals and businesses realize the need to invest in sustainable energy sources and the potential for substantial long-term benefits for saving energy,” said Francis J. Murray, NYSERDA President and CEO. “These incentives have been a valuable tool in supporting Governor Paterson’s clean energy agenda to help create jobs, reduce our greenhouse gas emissions, and increase our energy security.”
As of October, NYSERDA had received applications for $46 million in incentives for the installation of PV systems, or 64 percent greater than the entire amount provided last year. These incentives, which are paid to eligible installers but must be passed on in full to the customer, have benefited 512 residents, 123 businesses, and 145 non-profit institutions. In addition, the number of contractors involved in this business has grown by approximately 60 percent during the current calendar year to 174 contractors.
Since January, the price of solar modules used to construct these systems has decreased by more than 10 percent, and market assessments suggest that this reduction in module costs will continue over the next year as the recently ramped up global supply of PV modules meets demand. The decrease in PV module cost, on top of increases in federal tax incentives for PV, has provided an opportunity for New York State to restructure its program incentives to serve a greater number of customers.
"The PV Installation Incentive has helped to transform the market by bringing PV systems into the reach of more consumers than ever before,” Murray said. “Moreover, this program has been a critical catalyst for job growth by encouraging increased funding for community colleges and other groups to provide training for PV installation.”
Murray called the recent award of $3.5 million to Hudson Valley Community College a direct result of the demand for PV systems caused by the Incentive Program.
"Our new structure will help us continue to serve the greatest number of consumers as possible, prevent any potential disruption in contractors’ businesses, and provide a level of incentive that will ensure the continued growth of solar electricity and the solar electric industry in New York State,” Murray said.
For homeowners, the average cost of installing a PV system for a 2,000 sq. foot home is approximately $35,000. For these kinds of projects, the average incentive will be approximately $10,000, a decrease from $12,000 under the previous incentive program. These changes will have no impact on the federal and state tax credits also available to help provide incentives for consumers and businesses.
The funds to support this program are provided through the Renewable Portfolio Standard (RPS). The current PV incentive program officially ends on December 31, 2009. Applications will be accepted through this date or until funds are fully committed, whichever comes first. Determinations of the amount of funding available for this program are made by the Public Service Commission, and it is expected that the Public Service Commission will make an announcement on the future of the PV program in the near future.
Jeffrey Gordon, NYSERDA
518-862-1090, ext 3544
Last Updated: 11/26/2012