The number 2 state for new solar installations last year was North Carolina with 397 Megawatts of capacity. Nearly all of that new capacity was from utility-scale installations.
There are a number of reasons for the growth of utility-scale solar in North Carolina with rules that favor the big corporations. Tax credits and guaranteed income are the keys.
The federal government offers a 30% tax credit on new solar installations that is due to drop to 10% after 2016. The state of North Carolina offers another 35% tax credit on top of this. So anyone trying to install new solar facilities can qualify for 65% in tax rebates pushing down their costs down to just 35 cents on the dollar. The cost to install a megawatt of solar cells, normally around $3 million, drops to about $1 million. That’s good news if you have access to millions of dollars. However, the state does not allow solar leases, so if a homeowner wants to have a $20,000 rooftop solar system on his house, he has to pay out the whole $20,000 and then claim the $13,000 credit on his taxes. That’s more than the average homeowner can swing.
The guaranteed income comes in the form of a 15-year contract with the utility company. The state has streamlined the process to becoming a “qualifying facility.” Qualifying Facilities under 5 MW can get 15-year contracts with the local utility company (Duke Energy) at the utility’s “avoided cost.” Do the math, and it’s a guaranteed way to make money that you can take to the bank.
For three more reasons for the growth in North Carolina solar, see blog.rmi.org.