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apply that credit to the next billing period. Large commercial customers that produce excess generation may choose between valuing excess generation at a rate based on avoided costs or at an alternative rate based on utility revenue and sales (DOE, 2011b). Federal Tax Credits and Grants Concept: The Energy Policy Act of 2005 and American Recovery and Reinvestment Act of 2009 created tax incentives to encourage residential and commercial renewable energy development in the form of an Investment Tax Credit (ITC) and 1603 Treasury Program. The federal programs credit or grant a tax-paying entity 30 percent of the costs related to the installation of a qualified renewable energy system (DOE, 2011c). In practice: Tax credits for residential renewable energy systems help stimulate consumer interest, while tax credits (or cash grants in lieu of tax credits) have been effective in sparking project development and initiating industry growth. Since these incentives were first implemented in 2006, the cost of solar PV panels has declined 29 percent, largely due to the surge of products in the market, driving the cost per unit down. State and Local Rebate Programs Concept: To promote renewable energy adoption, many states and AHJs provide direct funding for system design and installation. Utilities may also provide their own rebates with varying conditions or stipulations, many based on system performance, system certification, installer credentials, etc. Rebate programs offer customers the opportunity to recover some of their initial capital investment. In practice: Wind energy is one of the great renewable energy success stories in the United States because of its versatility and range of applications. The Long Island Power Authority in New York manages a performance-based rebate program for residential and commercial wind installations. Residential installations may earn up to $3.50 per kWh for a maximum of 16,000 kWh per year, while commercial installations may earn a $0.50 per kWh rebate for annual production between 16,000 and 175,200 kWh. Community and Group Purchasing Concept: A community purchase occurs when more than one party shares in the ownership of a renewable energy system (usually wind or solar). A person may decide to participate in a community purchase if he or she resides in a home that is not suitable for individual renewable energy use. This concept is growing in popularity but is contingent on local laws, since utilities are often expected to split the energy bill among many users. In contrast, a group purchase is when Renewable Energy Best Practices in Promotion and Use — Andrea Luecke — Page 17PDF Image | Waste Heat Recovery and RPS Policies in the US
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