Recovery of solar tax credits by homeowners' association
From: Joel Plotkin (joelsunyit.edu)
Date: Wed, 11 Sep 2013 07:20:17 -0700 (PDT)
Apologies for the detail, which not all listers may need.

At Hundredfold Farm in south central PA, we've gone through a couple of
formats. Grid Interactive PV panels are required--a minimum of 2 kW. Our
ten households have a total of 30 kW. We produce between 2.5 and 4.5 mWH
every month. Individual homeowners receive a bill that lists Electric In
(from our rural Electric coop) and Electric Out. If Out exceeds In, the
homeowner's surplus is banked. At the end of the calender year, if there is
a surplus, the homeowner is reimbursed for that surplus by Allegheny Power,
the generator for our region, at the commercial rate, as if we were a
coal-fired WV facility. Almost all of our households generate more
electricity per year than used, due to an Energy Star appliance
requirement, CFLs, circuit strips, and other conservation measures.

Each homeowner received and took the federal tax credits. Since most of our
systems were built before the generous 30%, at the time, the federal credit
was a max of $2000 which we were able to take twice, because of our solar
thermal panels.

Next step: we originally registered with PJM GATS (the PA solar registry)
as an association. I sent our monthly totals in. We sold our RECs (which
were once as high as $250 per REC--each REC being 1 mWH generated). The
check was received by the Community Owners Assoc, and then distributed
proportionately to the households. The income was declared on the COA
return, but was below a percentage that triggered a tax obligation. Each
homeowner had a tax obligation, but balancing cost of system against the
income, few of us bothered to declare this "business" income.

Later, on advice from a potential aggregator, we registered each home
system separately with PJM GATS, but continued to receive a single check
(since our REC broker wasn't willing to send out 10 small checks). In the
last few years, however, PA reached and exceeded its target percentage of
alternate fuel generation, so our RECs are worth under $10 or so. The SREC
trade newsletter (newsletter [at] srectrade.com) lists current state REC 
amounts.

This is an on-going story, obviously. Even though our payback amounts have
been reduced, we have the ethical capital that comes with a much-reduced
carbon footprint.

Joel Plotkin
Hundredfold Farm
Orrtanna, PA

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