2012 Florida Solar Panels Update
Florida seems to like its renewable energy policy like it likes its traffic around Miami: stop and go. Some of the laws here are A-OK, maybe even perfect! Others are, well … nonexistent.
No Renewables Portfolio Standard, no property tax exemption, no statewide solar power rebate or tax credit program.
Luckily some of the utilities, including those in many of the major population centers, have picked up the slack by offering their own rebates on your shiny new photovoltaic solar power system.
All in all however, Florida’s legislation on renewable energy is lacking. We’re resting entirely on the backs of the utility companies’ solar power rebates. It’s time to get Tallahassee back on the job, and kick-starting those statewide programs again!
Florida’s (Lack Of A) Renewable Portfolio Standard
A Renewables Portfolio Standard (“RPS”) is a law or other piece of regulation that mandates that a certain percentage of at state’s energy production comes from renewable resources by specified target dates. If you keep up with renewable energy policy, you already know that a great many states have passed such standards. Many of the RPS’ mandate goals as high as 30%, even 40% production in the not-that-distant future.
So what’s going on in Florida? All those people, all that money, and no statewide RPS? We’re not just disappointed; frankly, we’re shocked. Props to JEA (formerly Jacksonville Electric Authority) for voluntarily opting into an agreement with some environmental organizations to produce 7.5% of its power from clean, renewable sources by 2015. Really, we meant that – but 7.5% in one of the state’s smaller cities is just a drop in the bucket.
Florida needs to get on board with Colorado, California, New York, New Jersey, Connecticut, Rhode Island, Oregon, Washington, Arizona, and so many more states that have already passed strong RPS’s to ensure a bright future for solar power and other renewable energy. And believe me, a strong RPS is integral to that bright future. Nobody wants to give you free money – least of all the utilities. Without a strong RPS pushing them, the fat-cat politicians and businessmen have no incentive to give you incentives. Solar panels in Florida can be a great source of energy for the state, but the state needs to help get the ball rolling.
Florida Solar Panel Performance Payments
While many states offer performance payments to homeowners with solar panels, Florida only has this option with a couple of small local utilities. We hope this isn’t becoming a trend. As to those local offers:
First up, for those of you in the Gainesville area, Gainesville Regional Utilities (“GRU”), offers a solar Feed-in Tariff (“FIT”). If you opt into the program (we’ll get there in a second) GRU will purchase energy form your solar power system via a standard offer contract at predetermined rates for a period of 20 years, plus the remaining balance of the calendar year in which the contract is executed. Right now that contract rate is $0.32 per kilowatt-hour (“kwh”).
Residential customers with PV systems less than 10 kilowatts have the option to enter into a FIT agreement and sell 100% of their electricity to GRU, or to net meter (discussed below) and sell only their net excess generation to GRU. For those residential customers who choose to net meter, GRU offers a rebate as well, which we’ll cover in just a moment.
Generally the best option for a small residential system is to use the power you generate, and take the net metering credits for any savings. The choice, however, is unique to everyone’s home and how much solar power they produce. Don’t worry – the installers we partner with are experts at help finding the set-up that’s best for you and your wallet.
In addition the Gainesville program, the Orlando Utilities Commission will pay customers to produce solar power at the rate of $0.03/kwh.
That’s not a lot – in fact it’s far too little, but it does add up to a couple hundred bucks a year with a standard 5kw system and hey, cash is cash, especially in a place without statewide performance incentives.
Under this program, the electricity output of your solar power system is used to power your home and you still get paid based on total output, so that couple hundred bucks really is free money – you don’t have to sacrifice any other benefits of your solar power system to collect it. Any net excess generation produced by your system is credited back to you at the utility’s full retail rate.
Sadly that’s the end of the currently available performance incentives for solar panels in Florida. Again, just a drop in the bucket. Until the state creates a uniform performance incentive for all residents, or until the big utilities in Miami, Ft. Lauderdale, Palm Beach, and Tampa get on board with their own icentives, performance incentives in Florida won’t do much to encourage solar power.
Florida Solar Utility Rebates
OK. It’s official. This is a trend. Florida has no statewide solar rebate program, and again we see only a few patchwork fill-ins from individual utility companies. The statewide rebate program you may have heard of, Florida’s Solar Energy Systems Incentive Program, is sadly no longer taking new applicants. Here’s a summary of the currently available rebates for solar panels in Florida:
|Utility Company||Rebate amount||Cap|
|Florida Power & Light||$2,000/kw||$20,000|
Florida Solar Panel Tax Credits
Well now. This is bad indeed. The first part of the trend is continued — Florida has no state tax credit to incentivize solar power– but this time individual utilities can’t help fill in the holes. Florida is dropping the ball on everything so far!
Solar Tax Exemptions in Florida
Whew! That’s more like it. We were getting really worried there, Florida. Thankfully just when we were giving up hope, you come up with the perfect renewable energy law! Solar panels in Florida are 100% exempt from all Sales Tax, for both purchase and installation. This exemption, first passed in 1997, was made permanent in 2005.
Where’s the matching property tax exemption though? Looks like we’ve fallen off the horse again here. When you install a solar power system, your home goes up in value because of the money you save on your electric bill. Most solar-friendly states exempt you from 100% of the ensuing property tax increase. But apparently not Florida … (sigh).
Utility Prices in Florida
Florida pays an average of 11.59 cents per kilowatt-hour of electricity. That’s more or less par for the course; the national average is 11.43 cents/kwh. Cheap electricity rates mean you’re probably not feeling too much of a strain in your pocketbook …. yet. Just don’t forget why electricity is so cheap.
That’s right, fossil fuels. Lots and lots on non-renewable, greenhouse gas producing fossil fuels. When all those fossil fuels really start to bite us in the butt, or start to run low … or both … electricity rates are going to rise, and fast. When that happens you’re going to be really, really happy you switched early to all that efficient, clean solar power that will be in high demand.
In the meantime, solar power will still save you a chunk of change here. We’ll go over just how much in a minute.
Florida Net Metering and Interconnection
Net Metering requires your utility to monitor how much energy your solar power system produces and how much energy you actually consume, and make sure you get credit for the surplus. Florida’s Public Service Commission “PSC” set specific standards for net metering back in 2008. The PSC rules apply only to the state’s investor-owned utilities; the rules do not apply to electric cooperatives or municipal utilities. Municipal utilities and electric cooperatives are required to offer net metering, but specific standards are not set by law.
Assuming you’re a customer of an investor-owned utility (most of us), any net excess generation (NEG), i.e. any surplus energy, is carried forward as a credit at the full retail rate to your next bill for up to 12 months. At the end of a 12-month billing period, the utility pays you for any remaining NEG at an avoided-cost rate.
Florida’s really making a late comeback here, because not only is that just about the perfect net metering law, it looks like you won’t have any problems getting on the grid. Unlike most states, Florida has no set capacity limit, i.e., you won’t get blocked form hooking up to the grid for net metering just because some of your neighbors have already done so. Your small residential system also lacks any of the possible hurdles and red tape that we’ve seen in other states. Now that’s more like it, Florida!
Overall we gave Florida a mediocre grade on interconnection standards because of the requirements for a redundant external disconnect switch and the mandatory insurance requirements for larger solar systems. Don’t worry though! These problems shouldn’t apply to you and your single-home system. For all systems under 10kw, it should be smooth sailing to get connected to the grid and start raking in those net metering savings.
5kW Example Return on Investment in Florida
What do all the numbers add up to for you? Let’s check:
We based our Florida solar panel rebate numbers for a resident of the Miami area. Check the chart above for what rebate you qualify for, and remember of course that all of these calculations are estimes. Your home is unique and how much power you generate and how much money you save depends on that uniqueness. The best way to find out how much cash switching to solar can save you is to get one of our free quotes, and an expert installer in your area can draw up a home-specific estimate for you.
Installing a typical 5kW of solar panels in Florida should start at about $25,000. Don’t freak – that’s gonna drop fast!
- Here’s here that big fat solar power rebate from FPL comes in handy! At $2,000/kw, we subtract $10,000 for your rebate, giving us a new starting cost of $15,000.
- The feds are smart – they calculate your 30% federal solar tax credit on your costs after state rebates. So we take 30% of $15,000, and subtract another $4,500 for a new price of $10,500.
- Finally we subtract your first year’s energy savings, which we estimate to be about $768. That brings your final cost after the first year to $9,732. That’s 39% of where we started – a discount of 61%!
- With a conservative estimate for the future rise of electricity prices, you can expect your new solar power system to pay for itself in about 10 years.
- In addition to those direct wallet-fattening savings, you also increased your home value by $15,368.
- On top from all that green in your pocket, you’ve created a bunch of green for the planet; 117 trees worth, every year your solar power system is humming, and you’re not buying fossil-fuel based electricity.
Like we said, the best way to know exactly how much money solar power can save you is to talk to one of our partners on the ground. Just fill out the form below and one of then will be more than happy to go over all those details and help you craft a plan to get the absolute most out of a solar power system in your home. Your quote is 100% free (yes, that’s right, 100% free) and you can get as many of them as that smart shopper in you desires!
Florida Solar Panel Consensus
If you’re lucky enough to cash in on one of those big utility-backed rebates for solar panels, Florida offers an astonishingly low initial cost (when you figure in that 30% federal tax credit as well) and a decent overall payback timeframe. That’s enough to earn a B from us, despite the gaps in statewide policy.
Careful though. We used to have a strong statewide solar power rebate program here, but dried up funding and failed promises held it up for years before it closed altogether. The utility rebates seem to be humming along, but if they dry up the way the statewide program did for solar panels, Florida is going to plummet to the bottom depths of our rankings.