Home Solar Panels Solar Service
Written by Rick Peters

Solar Plus Storage is Ready for Prime-Time Backup Power for your Home

As we’ve seen the cost of solar drop rapidly in the last ten years (more than 80%), we continued to endure those naysayers in the distance arguing that “no matter how cheap you make solar; much like wind, it will never dominate the energy landscape because of intermittency.” It’s hard to believe people still say “Never” in the context of technology? That term only provokes our great American drive and ingenuity, which continues to deliver. Witness electric storage costs have dropped 80% in the last eight years, outpacing the dramatic solar cost reductions!

Battery technology today

Today, electric batteries continue to back up solar in more and more markets every year. Batteries are giving solar system owners a lot more control and choice about energy independence, while giving grid operators a game changing tool to help manage the modern grid with greater economic efficiency. We’ll talk more about the how and why, later in this post.

Storage market is heating up

So far SES has contracted for 7 battery installs already this year in Maryland, up dramatically from 2017. The residential solar plus storage market has begun to take off in many markets. In fact, the preferred battery suppliers were out of stock for more than 4 months this year, both from increased demand to complement solar projects, but also due to the soaring demand increase for Electric Vehicles (EVs) that use the same battery technologies.

Storage is like bacon

Why is storage so valuable? One of my favorite energy experts, Katherine Hamilton (https://38northsolutions.com/team/bios/) once said that “storage is like bacon, it makes everything better.” Storage has almost a dozen value streams that can be monetized now or in the future. The two biggest and most obvious value streams are that it can provide extra capacity in times of high demand, and it can provide extra demand in times of excess capacity. In both cases, it provides stabilizing value to the grid and more efficient use of generating assets.

A testament to the value of storage on the grid was seen several years ago when the California Public Utilities Commission required utilities to procure a minimum amount of storage. Not only did the major utilities comply, they all procured more storage than mandated. They are well aware, storage helps them modulate an increasingly dynamic and decentralized grid.

Residential Solar Panels Anne Arundel County MD

Why should I consider solar plus storage for my home?

If you deploy solar along with your energy storage solution, you can utilize the same federal tax benefits as you do for solar, namely the 30% investment tax credit. In Maryland, you are eligible for an income tax credit on the storage portion of the system, in addition to the other state solar incentives (https://energy.maryland.gov/business/Pages/EnergyStorage.aspx). As a result, the economics in Maryland for residential solar + storage are much improved from a few years ago.

The main reason our residential customers are deploying energy storage is for backup power during a grid outage. This is typically done by way of an essential loads subpanel in their electric system. SES often installs these subpanels as part of our solar + storage project.

Another factor driving this trend is a residential customer’s desire to position themselves to cut the cord in the future, if the utility relationship becomes unappealing or uneconomical for them.

Lastly, future changes to electric rate design and/or net metering policy, could present solar + storage owners the ability to increase their savings or even generate revenue from the services that their frequently-idle storage can provide.

Are you building a new home and want to be sure it is ready for the energy architecture of the future? It’s easier than you think. Ask your builder or electrician to insure you have an essential loads subpanel (to use with electric battery storage, or possibly a generator). Secondly, request they install an empty (capped) electrical conduit from attic to electric room for us to easily add your solar energy conducting wire in the future.

Please see Roger Perry’s technical writeup on residential storage applications recently implemented by SES.

What has brought about this market opportunity?

Electric storage has long been an essential part of any true off-grid solar/wind application and this is where the earliest developments have taken place. As solar began to penetrate the grid in the last 10 years, there has been a lot of R&D investment in this future “holy grail” of renewable energy development. The investment is now paying off.

Storage broke into the US grid-tied market about five years ago. In the case of Hawaii, it was mostly a market driven change. Extremely expensive power, a grid congested with rapid solar growth, denials and delays of solar interconnection applications, and abundant sunshine, all contributed to the new paradigm. This resulted in economics that justified a certain segment of residential customers in Hawaii to cut the cord and embrace storage as a long-term solution. This sent an alarming message to utilities around the world: You better embrace these changes or plan to go the way of the buggy whip!

At about the same time, California’s PUC mandated a specific quantity of storage on the grid, much of it behind the meter. The utilities went on to exceed that mandate in the first auction and later in 2017, the target was increased again, with little to no resistance. In the past year, we’ve seen California utilities choose new battery storage over new gas fired peaker plants to meet peak loads in three separate cases. This is a tremendous validation of the economics of storage, particularly in an age of record low natural gas prices.

What’s ahead for energy storage?

The horse is out of the barn. Distributed energy generation combined with storage, will be the foundation of the future electric grid. The role that storage will play in this transformation will be enormous at the macro level, but somewhat uncertain at the micro level due to regulatory policy, incentives, and local market conditions.

We should expect to see strong storage growth in markets with the following attributes:

  • Places where local or state incentives are promoting storage – Maryland is one of them.
  • Markets where system owners can capture supplemental revenue from their storage investments (Our grid operator, PJM has piloted bundling distributed storage as a revenue generating resource for storage system owners)
  • Markets with high electric rates or Time of Use (TOU) rates.
  • Markets where electric “demand charges” represent a large cost for commercial and industrial (C&I) customers. This is because storage can dramatically lower a building’s electricity demand profile, and thus add energy bill relief to a portion of the bill where solar has had limited impact.
  • Microgrids are increasingly popular, particularly with campus style environments and military installations. These applications will increase storage demand and further drive down costs through scale and experience.

Next steps

Be sure to contact SES if you are interested in solar + storage. We will be happy to design a system that is customized to your needs. As always, we’ll provide you all the support you need to capture the Maryland solar grant and the storage tax credit (which has a limited budget) so contact us right away.

Home Solar Panel ,Solar Service
Written by Rick Peters

Peters’ Journey to Net Zero

Solar Service,Home Solar PanelsWhat Net Zero Meant for Us? Our Severna Park based, four-person family was looking to offset some of our home’s dirty energy, but we really did not have an expectation we could offset it all, but we had to start somewhere. We took our first step shortly after I joined the solar industry in 2008.

Low Hanging Fruit. In February 2009, we installed a 120-square foot solar water heating system to offset most of our water heating, and a small portion of our space heating for the first floor of our home. We saw big savings from this 3-panel system right away. Ever since, I enjoy the act of turning off the back-up water heating in April and leaving it off until almost October. For us, offsetting a dirty and expensive oil-fired boiler was the obvious low hanging fruit. We would later convert that remaining load to natural gas when the utility extended the pipeline to our home.

Solar Electric (PV) With the rest of the heat, A/C, and appliances all running off electric, it was time to look at the next opportunity. A few years later, when budget allowed, we decided to add a 5 kW solar PV system to our second story roof which faces SSE. My best determination was that we offset just over 40% of our electric load with that PV system. We were happy, but knew we’d want to find a way to get to NetZero eventually. , . I began to evaluate the remaining rooftops and consider what it would take to get us there. Solar panel efficiencies had improved a lot over the past several years so this reduced the remaining roof space we’d need to hit our goal

Phase 2 (PV). In the spring of 2016 we finished filling the balance of the south roof with some slightly higher wattage panels. As part of the same expansion, we added 24 relatively high efficiency panels to the E/W, low slope, rooftop of our one-story garage. We now had a total of 6.6 kW Equivalent of solar thermal and 13.8 kW of PV.

Not There Yet….We almost tripled our PV with the last upgrade and according to my calculations, this would get us to NetZero electricity. We’d know for sure by April, the annual true-up time frame for netmetering with BGE. When April 2017 came around, we were disappointed to come up a bit short (unfortunately, with a couple teenagers in the house, my usage predictions were a little off). Where do we go from here? I was not ready to put panels on the north roof, there had to be something available to us on the demand side.

Oops – More Low Hanging Fruit…One thing about Energy Efficiency, there’s always more opportunity. I had changed out many bulbs to LED over the prior several years, mostly through attrition, but I had not replaced any of the more than 2 dozen canister lights we had throughout the ceiling upstairs and down. Not only were these lights very inefficient, but the heat they generated in the summer was just adding to our air-conditioning load. We found the LED replacements on sale and replaced them all, as well as the remaining few incandescent lights in the house.

Commercial Solar Energy,Solar ServiceEureka. we have arrived!… In April of 2018 we received a $46 check from BGE for the annual overage from solar. With the kids heading off to college soon and a new refrigerator around the corner, I’m confident our checks from BGE will be getting bigger for the near future. At least until we purchase an electric car…

Residential Solar Panels S,olar Service
Written by Lisa Walsh

Solar Financing via Maryland’s Be Smart Loan Program

Residential Solar ,Panels Solar ServiceSolar Energy Services, Inc. recently became an approved contractor with the Be SMART Home Loan Program. This State of Maryland financing vehicle offers unsecured loans of up to $30,000 at a 4.99% interest rate. Aimed towards Maryland residents looking to lower utility costs, improve energy efficiency and add value to their Maryland home. The following solar projects qualify:

Solar Electric (Photovoltaic) Systems

These grid-tied solar systems give homeowners the option of purchasing more than 25yr worth of electricity at a fraction of the cost of their “rented” utility rates. Systems are purchase outright, and are eligible for the multiple financial incentives currently available.

Solar Water Heating (Thermal)

These systems are entirely separate from solar electric (PV) systems. They are most cost-effective for a Maryland family of 4 or more who currently heats their home’s water with electric, propane or oil. They require a relatively small amount of roof space and the upfront investment is lower than solar electric.

What are the Loan Qualifications and requirements?

  • Maryland resident
  • Home Owner
  • Verification of income
  • Credit score over 640
  • Debt-to-income ratio below 50%
  • Completion of a home energy audit

There is up to $30,000 in financing available for eligible homeowners.

What other upgrades qualify for the Be Smart Loan program?

Other qualifying energy efficiency upgrades throughout the home could include: energy efficient roof replacement, geothermal system, air infiltration reduction measures, increased insulation, hot water system improvements, heating systems maintenance or replacement, programmable thermostats, ceiling fans, windows, doors, duct work and energy star appliance replacement.

Can any Contractor perform the work?

Contractors must be listed on the State of Maryland’s Approved Contractor List as found here: http://dhcd.maryland.gov/Residents/Documents/besmart/BeSMARTApprovedContractors.pdf

How do I Apply?

  1. 1. Schedule a solar site visit with Solar Energy Services, Inc.
  2. Submit the Be Smart Home Loan Application along with SES’s proposal of work to be performed
  3. Be SMART will processes your Home loan application. Approval is based on your proposal specifications, satisfactory credit and affordability
  4. Submit your Home Energy Audit from an Approved Contractor
  5. You receive Loan Approval along with the first of two project pay-outs
  6. Upon receipt of payment, your Be SMART Contractor, SES, moves forward with interconnection, permitting and subsequent solar panel installation.
  7. The final payment is provided by DHCD when the work is complete and a DHCD inspector confirms that the work meets specifications

MORE INFORMATION

CONTACT: BeSMART Home Loan Program

Community Development Administration

Maryland Department of Housing and Community Development

E: BeSmartHome.dhcd@maryland.gov​

P: 301-429-7402 ​​​​

Or

info@solarsaves.net

410-923-6090

Residential Solar Panels ,Solar Service
Written by Lisa Walsh

Question of the Day: Will the new Administration affect my Solar Incentives?

Should we be concerned about the new Republican Administration and the future of Solar Power?

Solar Energy, Residential Solar Panels ,Solar ServiceDue to its tremendous growth, popular appeal, and ever improving economics, solar power enjoys increasingly bi-partisan support on the Hill and in Governors offices around the country.  Due to this, we predict very little, if any, impact on solar growth from the current Administration and/or a Republican Congress.  To help explain this, let’s look at the three main drivers of successful solar economics for the typical solar consumer – Federal Tax Credit, SRECs, and cost of solar equipment:

Federal Tax Credit:  30% of system cost.  This has been an enormously successful tax incentive enabling wide scale deployment of solar on both a utility and distributed scale.  Economies of scale have helped to drive the cost of solar; while further increasing demand – allowing the solar industry to grow exponentially.  This has been applauded by both major political parties for the private capital investment opportunities and huge job growth in the solar sector.   In fact, the US solar industry currently employs more people than the US oil, gas, and coal industries combined.

The 30% solar investment tax credit (ITC) was extended by Congress (many of whom were Republican) in late 2015 and is designed to decline in future years to eventually fall back to a permanent 10%.  The ITC schedule from the December 2015 legislation is as follows:

2016 – 2019: The tax credit remains at 30 percent of the cost of the system. This means that in 2017, you can still get a major discounted price for your solar panel system.

2020: Owners of new residential and commercial solar can deduct 26 percent of the cost of the system from their taxes.

2021: Owners of new residential and commercial solar can deduct 22 percent of the cost of the system from their taxes.

2022 onwards: Owners of new commercial solar energy systems can deduct 10 percent of the cost of the system from their taxes. There is no federal credit for residential solar energy systems.

In a nutshell, most in the solar industry believe it would be political suicide for the majority of congressional representatives to vote for a repeal of this enormously successful Investment Tax Credit that is scheduled to decline anyway.  There are too many solar jobs and solar projects in Republican districts for the majority of Republicans to consider advocating for repeal.  The horse is out of the barn and solar is winning!

SRECs: Maryland and Washington DC offer Solar Renewable Energy Credits to solarized homes and businesses.  This is a State/District-mandated incentive that, if anything, shows signs of expanding among the 29 States that have currently adopted an RPS (Renewable Portfolio Standard).  This is largely due to the fact that State Houses wish to support the exponential renewable energy sector job growth amidst the scheduled, declining Federal Support.

Solar Technology Costs:  Advancing technology, manufacturing scale, high adoption rates, and investor confidence in solar technology continue to drive down solar project costs.  We don’t see this momentum changing anytime soon.

Written by Lisa Walsh

First Community Solar Project in Washington DC

PRESS RELEASE

For Immediate Release

Tuesday, January 10th 2017

 

Father/Daughter Team Up for DC’s First Community Solar Project

WASHINGTON DC:  January 10th, 2017.  DC Resident Rebecca Mann and her father Neal Mann are poised to be the FIRST two PEPCO customers to take advantage of Washington DC’s newly revised and adopted Community Renewable Energy Facilities of 2016 (CREF).  After a process lasting three years, the District has finally worked out all of the kinks that enable D.C. residents to benefit from solar, even if they can’t put panels on their own roof.  Community solar offers the benefit of solar to community members (subscribers) who can’t, or prefer not to, install solar panels on their homes. This also gives renters an option to purchase solar power.

For the flagship project, Rebecca Mann is unable to install a solar power system due to limited roof space and shading constraints.  Located one mile away – her father, Neal Mann, is currently having a 16.24kW grid-tied solar power system installed.  This will generate enough power to offset a good portion of both his own, as well as his subscribing daughter’s, PEPCO utility bill —  at full retail price.

The project is currently under construction and is poised to be interconnected and officially net-metered by the end of January 2017.

Solar Energy Services, Inc. is one of the region’s longest running solar installation companies.  Founder Roger Perry has been in the solar energy industry for over 35 years.  His partner, Rick Peters, is a current Board member and past President of MDV-SEIA.  Locally owned and operated, SES installs both residential and commercial solar PV (electric), as well as solar thermal (hot water) systems in Washington DC, Maryland and Virginia.

Useful Links

PEPCO’s Green Power Connection and CREF

History of Washington DC’s Community Solar

For further information, contact:

Lisa Walsh 

Solar Energy Services, Inc. 

410-923-6090 X304

443-253-6941 Direct

Lwalsh@solarsaves.net

solar energy, renewable,
Written by Rick Peters

PACE Solar Financing in Maryland and Washington DC

Typical Commercial Challenges

As veterans of the small commercial solar market in this region, we are very familiar with the challenges of financing solar energy systems to this group of property owners.  Small businesses want solar as much or more than any other market segment, but they are capital-constrained like no others so they need affordable financing.

Third party solar developers have been the answer for other markets.  They can easily finance large systems because the cost of assessing the applicant’s credit is well worth the return.  In the case of residential systems, they can use universal tools like credit scores to help manage their risk.  For the small commercial and non-profit market, there hasn’t been a super-attractive  way to finance solar, until now!

Commercial Solar Systems Now Recognized as Public Benefit

Washington DC and Maryland now have laws and programs in place for commercial (and nonprofit) property owners to utilize PACE.  Property Assessed Clean Energy (PACE) is a vehicle that is used to finance energy improvements for buildings.  It operates under the recognition that energy improvements are considered to be a public benefit.  As such, PACE uses the property tax as a vehicle to structure the financing payments – much like we would finance a sewer extension, but in this case specific to one property.

PACE is very appealing to property owners because they can add significant value to their building on a cash-flow-positive basis without personal guarantees or the application of additional debt to the balance sheet.  The financing payment must be less than the savings and it’s paid in the form of a special assessment on the property tax bill over the term of the financing arrangement (5-25 years at competitive rates).  Multiple energy improvements (i.e. lighting, solar, new roof) can be bundled into one financing package.

The best thing about this approach to financing solar is that the property owner will own the system, not a third party.  The property owner gets all of the benefits, including the energy savings, the substantial incentives, the marketing value, and the satisfaction.  All it costs them is the interest on the financing which pales in comparison to the savings.

More info is available on your webpage on our PACE webpage but you may just want to pick up the phone and call us to see if your property is eligible.

Solar Service ,Home Solar Panels
Written by Lisa Walsh

DC Property Owners: Big Hot Water load = Big Solar Incentives

Commercial Solar Service, Annapolis MD

A growing number of building owners, developers and condo associations in the District of Columbia have come to realize that their building happens to be located in the most solar-friendly city in the USA .  Solar contractors, investors and financing vehicles are falling over each other to get solar panels on District roofs and start generating  the lucrative solar renewable energy credits (SRECs).   Whether via Direct Purchase, or $0 solar leases – SRECs are undoubtedly the reason for the solar season in DC (more to follow on those below).

However, before you sign on the dotted line and fill your roof with a 25-year solar PV (electric) system, as offered by 9 out of 10 solar professionals, make sure that you’re not losing the opportunity to vastly increase your return on investment with a Solar Thermal System.

Solar Water Heating Feasibility

The pre-qualification for a Solar Thermal System involves three questions:

  1. Does your building have a substantial, daily (365 day) hot water need? (i.e. apartment building/condos, restaurant, laundry, brewery, health center)
  2. Does your building have a centralized water heating system (as opposed to individual units throughout the building)?
  3. Can the building accommodate additional storage tanks?

If you answered YES to these three questions you really (really) should first consider a Solar Water Heating system either before – or at a minimum – in tandem with, a solar PV system.  (Shopper Beware – unless your solar contact has experience with solar thermal – which many do not – you’re going to have to be prepared to shop further).

What is Solar Water Heating (or Solar Thermal)?

Other than using the sun for energy generation, Solar Water Heating Systems operate entirely differently from their electron-shaking PV counterparts.  These time-tested, technologically mature systems are mechanical in nature and relatively simple.

Moreover, a solar thermal panel is 60 – 70% efficient; whereas a solar PV (electric) panel is typically 17 – 24% efficient.  Therefore, solar thermal panels generate substantially more energy per square foot than PV panels,  monetizing many more SRECs.

Solar Service , Home Solar Panels, Solar Renewable Energy

 

Let’s Review SRECs…

SRECs (Solar Renewable Energy Credits) – along with the 30% Federal Tax Credit and 100% Year 1 depreciation– are what drive the tremendous economic benefits of solar in Washington DC; one of several jurisdictions that have enacted a Renewable Portfolio Standard requiring that a specific percentage of electricity consumed must come from solar.   Whether residential, commercial, or institutional, each time a solar system generates 1 Megawatt hour of energy – the solar system owner generates 1 SREC.  This SREC is then sold via aggregators to an SREC market where it is bought by competitive energy suppliers to allow them to meet their share of the compliance obligation, or else pay a legislated fine (Alternative Compliance Payment, or ACP) for every SREC they are short.  Washington DC currently generates the highest SREC values in the country, largely due to the fact that DC does not have the real estate to install large solar farms which can rapidly oversupply a market and drive down SREC prices.

How much are SRECs Worth?

Washington DC SRECs are currently trading at $395/SREC.  To provide a frame of reference, a 6000 sq ft rooftop in Washington DC outfitted with a 75kW solar PV (electric) system could generate around 90 SRECs/year (over $35,000/year).   Depending on variables such as system size, corporate tax rate and and project site attributes, this SREC income – combined with a 30% Federal Tax Credit and 100% Year 1 depreciation, typically result in IRR’s between 30% – 60% and a Simple payback of 3 – 5 years.    Assuming solar thermal is applicable, this same roof outfitted with a Solar Thermal System could fit a kWh equivalent of a 150kW+ system, generating 180 SRECs/year – and see an IRR of 50 – 80%, with a simple payback in the 1 – 2 year range.

Solar Service ,Home Solar Panels, Residential Solar PanelsMaintenance

Although Solar PV (electric) clients often opt for an O & M (operations and maintenance) contract through their solar installer, Solar PV Systems  have relatively minor maintenance needs; usually an annual inspection along with ongoing monitoring.    Solar thermal (water heating) requires a little more maintenance including a 3 – 5 yearly service which, at a minimum, includes a replacement of the propylene glycol/energy transfer fluid that can degrade with time.  Nonetheless, the impact of service costs on the overall IRR is relatively small and easily absorbed by the increased SREC income.

Written by Lisa Walsh

A Primer on Solar Power

Did you know that attempts to harness the sun’s power through the development of solar cells dates back to the late 1800’s? I am sure that this, and other information, may be new to our readers. This article will provide you with some basic facts about solar power and solar energy. That way, you can join the conversation, and the renewable energy movement!

  • The first successful solar cell was developed in the early 1950s. It was made of silicon, and able to power small electronic devices. This was hailed as the beginning of a new era of energy resources, even then being acknowledged as having the potential to offer a limitless supply of electricity.
  • The first true application of solar cells could be found in the space program at NASA and in Russia. They were the only ones who could afford this technology in the 1960s.
  • The cost of solar cells continued to decline incrementally, but not so significantly that solar was a common source of energy through the 1970s. But, as the 1980s dawned, and ever since, solar power has insinuated itself into all aspects of life, commercially and residentially.
  • The first solar panels for buildings were developed in the early 1970s. In truth, this initial foray into the potential for large scale residential solar power was actually a solar array built into a rooftop. Panel development followed, as the cost and manufacturing efficiency increased.
  • President Jimmy Carter had solar panels placed on the roof of the White House in 1979. Everyone was getting into the act!
  • Welcome to 2018. Today it is common to find solar-powered cars, solar-powered telecommunications, and even solar-powered aircraft. One car company, renowned for their progressiveness, has incorporated solar panels into the roofs of their vehicles!

But, there’s more! Technology continues to expand the horizons of solar energy, making it affordable and applicable in new ways and new places. For example, it is possible that eventually solar panels on rooftops will be replaced with solar shingles!

Or, consider this, a solar fabric is being finalized that can be attached to houses as a cooling device!

We here at Solar Energy Services are excited about the future applications of this renewable source of energy for personal and commercial uses. You can count on us to utilize our superior knowledge and expertise to your advantage. We look forward to serving you!

Residential Solar Panels, Solar Service
Written by Lisa Walsh

Coming Up! Solar Open House in Ellicott City, MD

SOLAR OPEN HOUSE with Kirk Cummings

Residential Solar Panels, Solar Service , InstallerWHEN:  Sat, Sept 17th 2016   |   2pm – 5pm

WHERE:  4919 Windpower Way, Ellicott City  MD  21403

Nothing says Sunshine’s a Wastin! like a freshly installed solar power system.  Join Kirk at this Howard County residence to get up-close-and-personal with an active solar system.  The homeowner will be on hand to answer questions about their decision-making process as well as working with SES.

Kirk will be on hand to tour the system with you and answer all of your questions onsite at the home of the Syed Family where Kirk designed and SES recently installed an 8.55k Solar power system including(30) Suniva 285 watt Solar panels and a Solar Edge Inverter System.

Solar Open House – $250 Discount!

All open house attendees who sign up for a proposal and sign their contract within 30 days will receive a $250 discount on their PV system installation.

Residential Solar Panels, Solar Service
Written by Lisa Walsh

Fannie-Mae Agrees: Solar is a MUST-DO for Homeowners

Fannie Mae Agrees:  Solar is a MUST-DO for homeowners

Solar Service, Home Solar PanelsJust last month, Mortgage Giant Fannie Mae announced their new mortgage option that allows solar energy projects to be rolled into the final mortgage amount.  Namely, the HomeStyle Energy Program is hot news for solar fans who use a Fannie Mae-approved lender for their mortgage; whether considering a first-time solar system purchase, or currently financing an existing solar system with an equity line of credit or unsecured loan.

Typical Solar Financing and Solar Energy

It’s no secret that solar energy system installations in Maryland and Washington DC have taken off like gangbusters.  In previous years, many Maryland homeowners were choosing to lease/rent solar panels in an effort to avoid upfront costs.  However, when compared with an outright solar purchase – a 20yr (or similar) solar lease proves to be quite expensive – as with most rental agreements.    Depending on whether the solar shopper lives in Washington DC or Maryland, the financial incentives (tax credits/SRECs) usually pay for between 40 – 80% of the system cost.  100% of this upfront solar cost needs to be sourced by the homeowner who usually use a financing vehicle such as an Equity Line of Credit or some sort of Unsecured Loan.

Fannie Mae’s Game-Changer…

As of June 2016, Fannie Mae borrowers have access to a new Energy Loan that allows them to simply add the cost of their solar system to their existing mortgage.  Here’s what makes this form of financing a game-changer:

  • Super-Low APR:  HomeStyle Energy can be used for new projects or to take higher-interest unsecured loans/lines of credit and refinance them or roll them into a potentially lower-cost mortgage.   In all likelihood this will result in unprecedented low financing costs for solar energy.
  • All Costs Covered:  Most financing vehicles have a non-negotiable cap on the loan amount, forcing some Homeowners to come up with a down payment.  With this program, lenders can finance up to 15% of the final property value.  For example, a typical single-family home located in Annapolis, MD may appraise for $350,000.  The available amount for the solar system on this Annapolis home would be $52,500.  In most cases, this amount would far exceed the amount of capital needed to complete the project, considering that most solar projects fall in the $24,000 – $34,000 range (before government incentives).
  • Peace of Mind:  The improvements also have to come with an energy report, whether a Home Energy Score Report or a Home Energy Rating Systems report, and must specify the monthly savings to the borrower.   Homeowners can rest assured that their mortgager fully supports the home improvement investment.

Does Every Home Qualify?

At this point in time, only Fannie-Mae  homebuyers or refinancers qualify.  The program does not extend to new construction or manufactured housing.  The following are eligible to apply:

  • New homebuyers
  • Existing mortgage holders looking to refinance their new solar system
  • Existing mortgage holders looking to refinance their existing financed solar system

All applicants have 180 days from close of mortgage note to complete the solar installation.  Bear in mind that refinancing homeowners may incur closing/additional fees in the transaction.

Contact your mortgage representative to see if the HomeEnergy Program is right for you.

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