This solar newsletter was originally published on March 9, 2018.

IRS Decision May Be Huge for Solar-plus-Storage Customers

The IRS stated in a letter released last Friday that federal tax credits for solar extend to battery systems added as retrofits to solar installments.

The letter was released in reply to a query from customers, who wanted to claim a federal Investment Tax Credit (ITC) for a battery, inverter, wiring and software they added to their existing rooftop PV system to store energy from the solar panels.

The letter found that, under these operating restrictions, the entire cost of the retrofit is eligible for the ITC (currently 30%).

According to GTM Research analyst Brett Simon, the policy that could “open the floodgates” for residential solar installers eager to add energy storage to their mass-market offerings.

However, the IRS letter ruling currently only appliesis “to the taxpayer who requested it,” and “Section 6110(k)(3) of the [Tax] Code provides it may not be used or cited as precedent.” So, for now, the wider impact of this decision remains uncertain.

 

Packed House at Solar Networking Meeting in Grand Rapids

On Monday, March 5, Michigan EIBC hosted its first Michigan Energy Forum of 2018 in Grand Rapids at member company Varnum’s downtown office. Michigan EIBC president Liesl Clark kicked off the meeting with an overview of Michigan EIBC’s events, programming, and advocacy. Laura Sherman, Michigan EIBC’s vice president for policy development, opened the conversation on solar policy in Michigan. Laura explained that of the 92,000 clean energy jobs in Michigan, 5,672 are solar jobs, and the clean energy job market grew almost three times faster than the broader job market.

Laura gave a brief policy update, highlighting Michigan EIBC’s legislative and regulatory action around solar. Representative Tom Barrett has introduced two bills to clarify the taxation of solar panels: HB 5143, which would exempt solar panels from real property tax assessment and HB 5680, which would add solar panels to the list of property improvements that do not increase true cash value (as listed in 1893 PA 206). Michigan EIBC has been working with Rep. Barrett to find the best path forward on a bill that will pass Committee. In other news, on Friday March 2, Representative Yousef Rabhi introduced HB 5692 and 5693 to strike the distributed generation tariff language from both PA 341 and PA 342 and revert back to the existing net energy metering program. . Laura also discussed Michigan EIBC’s involvement with the Michigan Public Service Commission (MPSC), including the new distributed generation tariff program, PURPA cases, the CON proceeding, Voluntary Green Power Pricing, and Integrated Resource Planning.

The main event was Julie Baldwin, Manager of the Renewable Energy Section at the MPSC who discussed ongoing issues at the MPSC including PURPA regulations and the Distributed Generation tariff. Julie gave an overview of UPPCO’s and Consumers Energy’s PURPA cases (U-18094 and U-18090, respectively). She highlighted that over the last 14 months, Consumers Energy has received 289 interconnection applications, representing 1,256 MW of capacity. The Commission is currently conducting a rehearing to fix small errors in Consumers Energy’s Standard Offer tariff. The Commission also opened a new docket (U-20095) to determine how utility capacity requirements should be determined. Comments in this docket are due by March 19th. Until that methodology is determined and applied to Michigan’s utilities, the Commission made an interim decision that for Consumers Energy, only the first 150 MW in the queue will receive full avoided capacity payments. Julie agreed that it remains to be determined to which “queue” this decision applies.

Julie also explained the Commission’s recent Order in the Distributed Generation tariff docket (Case No. U-18383). The Commission has agreed with the proposed an “inflow/outflow” system in which customers pay the full retail rate for energy they use and are compensated at a certain rate for excess energy they produce. The Commission will open a contested case to determine the value of the “outflow” credit customers will receive.

Despite confusion regarding language in the MPSC Order, Julie indicated that it is the Commission’s intension to abide by their July 12, 2017 Order and allow customers to sign up for net energy metering for 10 years as long as they are “participating” before a final tariff is established in a future utility rate case filed after June 1, 2018. This means that the earliest the new DG tariffs could go into effect is April 4, 2019. Comments in this case on a number of questions posed by the Commission are due March 12.

Michigan EIBC thanks our members, representatives of the solar industry, and MPSC staff for a packed house and robust discussion!

 

 

Solar Newsclips

In Michigan

• As solar energy gains popularity in Michigan, solar leasing has become a profitable option for farm owners.
• Consumers Energy’s claim that it doesn’t need any new capacity over the next decade is stalling hundreds of megawatts of new solar projects, according to developers seeking PURPA contracts with Consumers Energy.
• A case before the Michigan Tax Tribunal is underway to decide if Ann Arbor can keep taxing solar energy systems as property improvements.
• A solar farmhouse near Ann Arbor is recognized as one of world’s greenest homes.
• Eastern Michigan University is looking to increase safety throughout campus with the installation of solar panel lighting units at each of its bus stops.
• A solar installation is being considered as part of a planned “eco-industrial park” at a former vehicle manufacturing plant in Flint, Michigan.
• Hundreds of residents attended an open house for a proposed 20-megawatt solar project in Mendon.
• Traverse City Light & Power launched a pilot program for enrolling low-income households in community solar.
• Traverse City Central students are working to bring solar panels to their high school campus.
• A study aims to enhance communities’ access to solar in the western Upper Peninsula.

Across the Country

• U.S. solar installers are significantly more optimistic than they were in 2016, according to a recent survey. Here’s a closer look at the 10 states with the most solar jobs in 2017.
• Utility companies across the country are increasing their reliance on solar energy and batteries, which could edge out natural gas in power markets.
• The CEO of Sol Systems explains why solar will be the dominant source of new electricity generation in the United States by 2022.
• More homeowners are considering solar-plus-storage in light of recent natural disasters as a way to boost resiliency. In remote areas of Puerto Rico, for instance, interest in disconnecting from the grid by installing solar-plus-storage is on the rise.
• The Solar Foundation’s latest National Solar Jobs Census shows that the solar industry lost 9,800 jobs in 2017, marking the first annual drop recorded by the National Solar Jobs Census since it started collecting data in 2010.
• A new book explains how solar can provide a third of global electricity by the middle of the century.
• Investing in rooftop solar is starting to make sense financially in parts of the country, says a staff writer for Politico Magazine.
• Accounting for the cost of power outages can change the breakeven point for investments in solar-plus-storage systems, according to a new report.
• The solar module-level power electronics maker SolarEdge is pairing PetersenDean Roofing & Solar to create more affordable access points for the burgeoning renewable energy industry.
• Global solar tracker shipments reached a record 14.5 gigawatts last year, with NEXTracker accounting for a third of all solar PV trackers sold, according to a new report.
• Nationwide is investing in a fund looking to develop 330 megawatts and $500 million in solar projects across the U.S. in the next year. 
• A North Dakota entrepreneur developed a prototype that would make it easier to install solar panels on steep rooftops.
• Tesla has begun construction on what is being billed as the world’s largest rooftop solar array at its Gigafactory in Nevada.
• Legislation in Indiana would prohibit homeowners’ associations from imposing new rules on rooftop solar installations.
• Grazing sheep are being used to control vegetation at utility-scale solar facilities in agricultural areas across the country.

From Washington

• The cost of rooftop solar could fall as low as $0.05 per kWh by 2030, compared to 13 cents today, according to a DOE report.
• The IRS says a 30% solar tax credit can be applied to battery systems that are added as retrofits, as long as they only charge from the sun.
• Pending tariffs on imported steel and aluminum could add up to 2 cents per watt to the cost of utility-scale solar projects. 
• According to Greentech Media, President Trump’s recent claims that new import tariffs have prompted “at least five” solar plants to open aren’t true. In fact, the imposition of tariffs has resulted in a slate of legal challenges  against the Trump administration, including opposition from Canada and the European Union.

 

Events to Watch:

EUCI invites you to its Renewable Energy 101 Forum, March 12-13, in Portland, Oregon. Learn more and register here.

EUCI is hosting two courses on smart metering: Smart Metering 101 and Advanced Smart Meeting courses on March 19 and March 20, respectively.

EUCI invites you to the Renewable Energy PPAs conference, April 3-4 in Denver, Colorado. Register here.

EUCI invites you to the Utility-Scale Solar Power Plant Fundamentals conference on April 18 – 19 in Portland, Oregon. Register here.

You’re invited to present, advertise, exhibit, or sponsor at The Energy Fair, June 15-17 in Custer, Wisconsin. Learn more and register here.

The Solar Energy Industries Association (SEIA) and Smart Electric Power Alliance (SEPA) invite you to Solar Power International, September 24-27, in Anaheim, California. Registration opens in spring of 2018 here.