2006 is the Year to Add Solar to Your House


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2006 Is the Year to Add Solar to Your House

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You can save up to $100 per year with an easy to install programmable thermostat.

Update: the Solar Energies Industries Association (SEIA) has developed a guide to Federal Tax Incentives for Solar Energy. You can receive a copy free at their website.

The new Energy Bill has a nice tax break for homeowners who want to add solar power to their homes. The last time the federal government gave individuals a tax break on solar was 20 years ago. As it stands, the tax breaks are just for 2006 and 2007.

Starting in 2006, you'll be able to get a credit of 30% of the system's cost, up to $2,000. This is after any state incentives.

You can actually get two tax breaks for a maximum of $4,000. You can install a PV (photovoltaic) system to generate electricity. That will qualify for one tax break. Secondly, you can install a system that heats water, either as a water heater or for radiant room heating. That also qualifies for a tax break. In addition, Maryland is extending it's grants. For residential solar water heating installations, there's a grant of 20% of system costs, up to a maximum grant amount of $2,000. For residential photovoltaic installations, it's 20% of system costs up to a maximum grant amount of $3,000. These were set to expire in 2005, but have been extended to accommodate the new Energy Bill incentives. more about Maryland's program

To be eligible for the solar hot water system tax credit, the system must be certified by the Solar Rating and Certification Corporation (SRCC) and produce 50% or more of the hot water needed by the residence. There is no qualification provided for PV systems.

The solar industry considers this a big deal that will really help boost the number of new installations. Locally, there aren't too many qualified solar contractors, so they may get very backlogged. It makes sense to contact one soon to learn about your options. The new credits apply to systems placed in service in 2006 or 2007, so you could start the process now.

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