Trillium Lake, near Mt. Hood
Oregon, sweet Oregon. The residential solar program has been sunny here, and may it roll on! Land of plenty: water, food, commerce, and even sunshine (east of the Cascade Range is sunnier than west). Home to numerous wineries, beaches, rainforests, the Cascade Range, Columbia Gorge, high desert, and the lovely city of Portland; Oregon is still one of the best places to grow your own power, too.
Oregon has put together a remarkably good package for you over the last decade.
It used to be even better, especially for business owners and schools. The (BETC), business energy tax credit, affectionately know as “betty,” needs funding to continue. As for Bonneville’s generous “Solr4OurSchools”, today schools need to apply for a small chance at that grant. One great thing remains: most provisions for YOU the residential homeowner remain INTACT.
The Energy Trust of Oregon began working to collect funding for the state solar power rebate beginning in the early 2000’s. By 2009, it was distributing an excellent rebate AND providing excellent information for every interested PV enthusiast. Unfortunately, the money that Oregon Energy Trust offers has become quite the moving target. We can only hope that the agency does as well keeping its funding levels as it did gathering them together in the first place.
Oregon doesn’t leave all the glory to the Energy Trust by itself. The State offers you an even larger discount off your state taxes. So in general, the state is still showing every sign of continuing to shine in solar.
Oregon’s Renewable Portfolio Standard
An RPS is a law, state or national, that says that a utility must get some percentage of its power from renewable resources like solar and wind. More info and you win a prize if you read all about the RPS here. (Not really about the prize.)
Oregon’s renewable portfolio standards (RPS) are among the best in the country, and certainly the easiest to remember: 15% by 2015, 20% by 2020, and even 25% by 2025. So every utility in the state of Oregon is required to source at least 25% of its power from renewables by 2025, and that does NOT include large hydro.
Not as good or ambitious as California’s most aggressive 33% by 2022. But the trend would suggest (to the suggestible) that Oregon is taking a more sustainable, gradual approach. Might we have 100% renewable energy by 2100? Not without improvements in solar panels! But seriously: if you did count hydro, Oregon already IS 100% renewable for a good part of the year, when thermal (coal, nuclear and gas) generation drops down near zero for many months at a time (spring.) Hydro-power doesn’t count for RPS standards, and there’s no further target past 2025; but may future improvements in (solar!) technology make the ultimate goal possible.
Realistically, the legislature could make some very large improvements in the RPS standards today, if it wanted to. For instance, a “solar carve out,” or a percentage of generation that has to be met using residential solar power. If the Oregon RPS standards adopted a solar carve out, like states such as Nevada or Colorado have, the utility companies would be much more willing to offer incentives to middle-class homeowners. That instead of to millionaire land development moguls who are putting more large scale wind into the grid than the system can handle.
Oregon’s Electricity Prices
The average cost of electricity is a relatively cheap $0.12/kwh in Oregon. The reason is that the Pacific Northwest has an abundance of cheap hydro-power; lavishing the region with the lowest cost energy in the nation for 100 years running.
Prices have gone up recently, mostly because utilities are adding more and more wind power. Wind provides lots of low cost energy, but only when the wind is blowing: especially during the spring and at night. Spring coincides with large runoffs in the Columbia river, fueling hydropower to the max. Night time is when people are sleeping and not using the power. The utility has to actually pay the neighboring utilities to use extra power at times: not as great for rate payers here as elsewhere. Also, the huge fluctuations in the power supply require expensive solutions, raising rates. In spite of the difficulties, Oregon remains committed to the carbon offset that wind provides, even in the face of attendant rate increases.
As rates climb, and they will, residential solar will be a better and better alternative to the expected cost escalation. What’s more, unlike the wind, the sun shines during the day when the power is actually needed!
Oregon Solar Performance Payments
Performance payments are paid over time to the owner of a renewable generating system (you) for how much renewable energy you generate.
Unfortunately there are only performance payments in Oregon for EWEB customers (Eugene), and then only for systems larger than 10 kW, twice as large as most solar systems. The payments range between $0.07 to $0.11 per kilowatt, so you might consider purchasing a huge PV system in Eugene.
As for Pacificorps and PGE, if EWEB can do it, which one of the others can do a better job as Eugene at maintaining performance payments? Suggestion: give them to residential customers with smaller systems!
Net Metering in Oregon
Basically, with net metering if you generate more power than you need, you’ll get a credit on your next bill. Oregon provides 100% net metering, but you can’t keep carrying the credit over from month to month like you can in some states like Connecticut and Nevada. If you could, I would expect solar systems in Oregon to be a bit larger than the typical sweet spot of 3.29 kilowatts (word on the street, Talk to your installer) as encouraged by the Oregon solar incentives.
Some states allow 100% off on sales tax for PV equipment, but Oregon doesn’t have a sales tax, so there’s no discount. Just the same 100% break on sales tax as everything else you buy here!
Good news is that your home solar panel system is property tax exempt! You’ll be adding a hefty sum to your property value (roughly twenty times your annual utility savings). It’s heartening to know that by doing right by the environment, future generations, and your pocketbook, you won’t be penalized come tax time. Do the paperwork, and use this law to keep the tax man away.
Energy Trust Rebates (and RECs)
The Oregon Energy Trust has a great incentive for home solar energy installations, but the amount of the solar power rebate is a moving target, and there is fear that it might go away. Not the right feeling to drive investors and suppliers, but it’s free money nonetheless.
Solar rebates used to be $1,000 a kilowatt for PGE customers and $1,500 for Pacificorps customers late 2011. In April, 2012, they said it was $1,000 for both, and on their website it reports $750 for PGE.
The maximum solar panel rebate used to be $5,000 for one utility and $7,500 for another, now we hear $5,000 for both. Your best bet is to connect with Oregon solar installers we trust at the bottom of the page so they can get you the most up to date information.
Regardless, if you get your Energy Trust incentive, which you can and should, the only downside is your RECs will be owned by the utility. RECs are credits that can be sold to utilities so that they can meet their RPS standards. If you take the Oregon Energy Trust rebate, the utility will already own your RECs, so you can’t go selling them to someone else.
Oregon Solar Tax Credit
The maximum Oregon Tax Credit for Solar is $6000, which you will get all of, but not immediately. The total amount gets credited to your tax returns in $1500 chunks each year, for the first four years of your happy new life as a PV system owner.
5kW Example Return on Investment
Oregon has more sun than you would think, especially in the eastern half of the state. However, for now we take OFF our rose colored sunglasses and do an estimate for your house in rainy, but progressive Portland:
- Installing a typical 5kW solar system in the Rose City might run you, say $25,000. (Don’t panic, this is gonna drop quite a bit in a second)
- The Energy Trust of Oregon cuts five thousand dollars out of the initial cost in the form of a one-time solar power rebate! (SPR tip!: Ask an installer further down the page if they can take the credit for you in advance so you don’t have to wait for the check.)
- The State of Oregon gives you $6000 off your taxes in pieces of $1,500 spread out over four sunny tax years. So, in the first year alone you get to take off $1,500
- The fed takes a look at the remainder, and gives you 30% off of what’s left back on your federal income taxes the year you installed the system. In our example, the federal solar tax credit lands you a hefty sum of more than $4,000.
- Your annual electricity savings are right around $743 per year, and you can expect that to continue for the life of your equipment, which is nearly as long as you care (20+years.)
- The biggest boon is not so obvious, but it’s the increase to the value of your home: we calculate $14,859 on a rainy day, probably more! Keep in mind that property value increase is tax exempt!
- Money aside: What you did for mother earth was the equivalent of planting 104 trees. Oregon loves trees, and loves you as well for doing a good thing.
Back to the pocketbook though, your home solar panel system should pay for itself in 10 years, not bad at all for Portland.
In sunnier Bend, or Prineville, we would expect that bright, (ohh briight!) sunshiny day of having your PV system pay for itself come a year or two earlier.
To find out how the numbers work out for you, fill out the form below and we’ll connect you to experts we trust in Oregon to get calculate realistic estimates for you based on your unique energy usage, location, shading, roof orientation, and roof type. They’ll even do it for free!
Also, as of 2012, there are even plans available that let you go solar for nothing down, also called solar power purchase agreements (PPAs). You’ve probably heard of them before. Be sure to ask your Oregon solar installers about that possibility too if you’re interested.
Oregon spent a decade building funding for its collective PV powered house. That is represented by the Energy Trust of Oregon, as supported by a fairly liberal legislature. The biggest trick is making sure we maintain funding for these excellent programs.
And it only makes sense for the utility that Oregon does that: the Northwest has a ton of wind and hydro, which works almost TOO well during the winter and spring. But come summer, Oregon must fire up a bunch of yucky thermal power plants to meet the electrical load during the day. Don’t forget: during the day, during the summer, it’s actually pretty darn sunny all across Oregon.
The list of improvements includes a solar carve out for RPS standards, performance payments across the state for smaller systems, and to keep funding for the good work. Oregon residents are either very liberal or very independent: two perfect dispositions to make us all residential PV owners. Just what the grid needs if we are to make our target of 100% renewable energy by 2100! Just the logical trend. Seriously though, keep up the good work, Oregon!