Cindy’s Lobstah and Chowdah!

Solar Legislator Score:

2012 Update

Known for a bit of everything from beaches to quaint seaside towns and windswept rocky coastlines to fantastic mountain hiking trails and thousands of lakes, Maine is an outdoor wonder. All that wonder is full of energy too. The wind, the tides, and most importantly, the sun are all at work keeping Maine fueled. The real question is how has the legislature done in promoting all the energy that’s just lying around for the taking? Keep on reading to find out.

Maine’s Renewable Portfolio Standard

A Renewables Portfolio Standard 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. Maine has one of the strongest Standards in the nation, paving the way in agressive renewable policy with a requirement that 40% of total retail electric sales come from renewable resources by 2017, including a 10% requirement “new” resources installed after 2005 that eliminates some of the less efficient and environmentally friendly power generation methods. Utilities must currently generate 5% of electricity from these new resources. That requirement will raise 1% per year until the target is reached.

Solar Performance Payments in Maine

Maine’s Community-based Renewable Energy Production Incentive, currently in a pilot program, offers a payment of $0.10 per kilowatt-hour (“kwh”) of solar power produced. While that sounds nice, this incentive literally purchases the electricity from you; it’s not a premium paid simply for producing the energy. That means that if you choose to take the $0.10/kwh, you’re not cashing in on the savings offered by net metering. With current retail electricity rates above 14 cents (discussed further below), your single-home system will almost certainly save you more money by simply using the power yourself and getting credit for any surplus through net metering, rather than selling it under the Community-based Renewable Energy pilot program. If you do choose to sell your power to the pilot program, you the standard offer of $0.10/kwh comes with a 20-year contract.

Maine Solar Rebates

Efficiency Maine offers a solar power rebate on the installation of your new solar power system. Yep! Free money, just for switching to clean solar power. The current rebate is $500 per 1000 kwh of estimated annual electricity production. The solar rebate is capped at $2,000 for residential systems.

Solar Tax Credits in Maine

Maine lacks any tax credits for solar power. Now, you may think we’re being greedy because of the solar panel rebate available here, but a lot of Efficiency Maine’s funding comes from the system benefit charge already built into your electric bill. You’re really just getting your own money back! We think the legislature can do more by offering you a personal tax credit to help offset the cost of switching to solar power.

Solar Tax Exemptions in Maine

Unfortunately Maine does not currently offer any tax exemptions for solar power. Usually states with an RPS as top-notch as Maine also hit the easy spots, like offering a full exemption on associates sales and property taxes (on your home’s increase in value; we’ll get to that). This is another easy opportunity to make switching to solar power even easier for you, without much cost to the state.

Utility Prices in Maine

Maine pays an average of 14.34 cents/kwh of electricity. That’s noticeably above the national average of 11.43 cents/kwh, but 14.34 is also noticeably below the New England regional average of 16.09.

We know you hate those electric bills, but here at Solar Power Rocks, we actually think electricity prices are too low. At least for current production methods. Most of our electricity still comes from burning millions of tons of fossil fuels. The cost of those fossil fuels in dollars and cents may be low (for now), but the environmental costs are astronomically high. Switching to solar power now saves you money (and helps save the planet); when scarcity and environmental costs drive up the monetary costs of fossil-fuel based energy, the early switch to solar power is going to be saving you piles and piles of money. Just remember to thank us.

Maine 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. If you produce a surplus, you get credit for it on your bill.

Maine requires all utilities to offer net metering to individual customers. Net excess generation in any month is credited to your bill for the following month. That’s a real strong start. Unfortunately credit does not carryover indefinitely. Any unused credit reverts back to the utility without compensation after 12 months. In addition to allowing you to keep your credits indefinitely (or take a cash payment at the end of those 12 months) we’d like to see regulations specifically forbid the utilities from charging you any extra or unanticipated fees in the net metering process.

Maine also has a very strong interconnection law, covering all utilities and project sizes under a tiered system. Your residential system is likely to be in tier 1 (10 kw or less), which means you get simplified procedures and an application fee of only 50 bucks. Your system is also exempt from any insurance coverage requirements.

5kW Example Return on Investment in Maine

What do all the numbers add up to for you? Let’s check:

Installing a typical 5kW solar system should start at about $25,000. Don’t worry, that’s going to come down a lot in year 1.

• First we account for the state solar power rebate from Efficiency Maine. Subtract $2,000 for a new price of $23,000.
• The federal government calculates the 30% federal solar tax credit based on out of pocket costs, i.e. after the state solar rebate. Subtract $6,900 (30% of $23,000) for a new price of $16,100.
• After the federal solar tax credit we subtract your first year’s energy savings, which we estimate to be about $896. That brings your cost to $15,204, a price drop of nearly ten grand already.
• 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 13 years. After that you’ll be turning a profit (yes, a profit) for the rest of the life of your solar panels (typically about 25 years). We estimate that profit to be about $25,000 through 2037.
• In addition to all that money directly in your wallet, that new solar power system also increases your home value by $17,921.
• Not to be forgotten, you’re also pumping out a bunch of green for the environment. Tree green that is. The fossil-fuel energy you’re not using is the carbon-saving equivalent of planting 110 trees a year, every year your solar power system is humming.

These numbers are estimates. 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. 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!

Maine Solar Consensus

Solar policy is a bit stop and go here. The RPS is one of the strongest we’ve seen – a whopping 40% by the not-very-distant 2017. Strong net metering and interconnection laws make sure that you can get onto the grid and take advantage of higher than average electricity costs for higher than average savings. On the other hand, Maine lacks tax exemptions and performance payments that have helped promote solar power elsewhere, and the state solar power rebate program is limited. That kind of mixed policy suggests a mixed grade, and so does that 13 year payback timeframe – not terrible, but certainly not great. Maine ranks in at a “C” for now, but there is room for fast improvement under the umbrella of that strong RPS. We’ll check back in soon and see how solar policy progresses here.