| Description |
Variable fuel prices and the interest in pursuing less carbon intensive energy has led to a variety of federal and state policies for renewable energy. Solar photovoltaic (PV) has become a commonly used renewable technology. Despite a high upfront cost, solar PV has a long economic life, little maintenance cost, and is relatively easy to install. The State of Utah has had one of the longest lasting renewable energy tax credit policies in the nation. The program has seen a 1,200 percent increase in processed solar PV credits between 2010 and 2015. It is estimated to have tripled in 2016 to around 12,000 applications. The credit is set to expire by the end of 2017. This paper identifies major renewable energy policies and the specific impact of PV tax credits on Utah's residential PV adopters and taxpayers. Additionally, I look at national trends as well as the incentive to households to install PV by examining payback periods with and without the tax credit. Finally, I propose a phase out of the current tax credit and replace it with a credit towards individual energy storage. The current electrical grid is unable to support intermittent sources of energy like solar PV. Thus, residential solar PV consumers must purchase their own distributed energy storage systems in order to compensate for peak usage. To properly identify the appropriate tax credit for a solar storage system, I design the optimal grid connected PV system and battery storage for a standard Utah home. |
