California Incentives for Business Solar

 

A list of California state sponsored solar programs

State Funding (Enhanced funding for existing State programs) Summary Appropriates $16.8 billion to DOE’s Office of Energy Efficiency and Renewable Energy, which will be distributed to the States. Provides $3.1 billion for State Energy Programs. This funding will most likely become available first and so this should be a priority for contractors and developers. How the funding is spent is at the discretion of the state energy offices and the Governor.

Certain states will also be subject to legislative approval. The majority of the funding will be used for energy efficiency and renewable energy. For example,  New Jersey will most likely use most of the funding for residential and commercial solar installations.  Other states will choose to use the majority for energy efficiency, however, complimentary efficiency and solar retrofitting opportunities are well suited The total amount also includes $3.2 billion for Conservation Block Grants. First‐year funding for these Grants can be used to develop a “proposed energy and conservation strategy” that each local government must submit to Department of Energy without one year of receiving initial allocation.  DOE must approve or disapprove it within 120 days. Additional funding is contingent on plan pproval. DOE funding also includes $5.0 billion for Weatherization Programs and $2.0 billion  for batteries and storage.

How to Take Advantage of This Funding

In order to take advantage of the State Energy Program funding you should contact your existing solar program manager or the state energy office for more information. DOE guidelines  for these programs were released March 12, and we suggest you contact the energy offices now to be prepared for the application process and to get any preliminary details. To be eligible for projects under the Conservation Block Grants program, coordinate with your local government. See Appendix A at the end of this document for funding that  will go to each state.

Solar on Federal Property (federal guidance pending) Summary Appropriates $5.5
billion to be deposited into the Federal Buildings Fund for expenditures to construct, repair and make alterations on federal buildings to increase energy efficiency, including installing solar energy equipment. $4.5 billion shall be available for measures necessary to convert General Services Administration (GSA) facilities to high‐performance green buildings. Appropriates $1 billion for non‐recurring maintenance on Veterans Affairs facilities, including energy projects.

How to Take Advantage of This Funding

GSA must submit a plan to Congress within 45 days, detailing, by project, how funding will be used. GSA is currently reviewing hundreds of projects currently in the agency’s backlog. Projects will be evaluated based on how fast GSA can create jobs and how much added energy efficiency and sustainability can be gained from projects ready for construction awards within two years. The GSA will be considering hiring contractors for various projects with likely priority given to female and minority owned businesses. Once details are determined, they will be posted online. Secretary of Veterans Affairs must submit a plan to Congress with 30 days detailing how funding will be used. Any State may apply directly to the Department of Veterans Affairs for grants for construction of state‐owned veterans home facilities. Pre‐application is due by April 15 for all projects. State assurance of matching funds is due by August 15 to receive priority status.

Clean Renewable Energy Bonds (CREBs) (Enhanced funding for existing State
programs) Summary

Provides an additional $1.6 billion for new clean renewable energy bonds to finance facilities that generate electricity from renewable
energy sources including solar facilities. How to Take Advantage of This Funding
This is intended for governmental agencies since they cannot take advantage of the ITC. In a CREB financing, the holder of the debt instrument receives a federal tax credit in lieu of interest paid by the issuer. Thus, CREBs provide an issuer with the ability to borrow at a 0% interest rate. Small projects are given first priority. Dept of Treasury sets tax credit rate on a daily basis. Tax credits are made on a quarterly basis. Please coordinate with your municipal government  on CREB projects. More information can be found at the CREBs website.

Qualified Energy Conservation Bonds (Enhanced funding for existing State
programs) Summary Authorizes an additional $2.4 billion, up from $800 million, in bonds to finance State, municipal and tribal government programs to reduce greenhouse gas emissions. These bonds can be used by government agencies to reduce energy consumption in publicly‐owned buildings by at least 20 percent, implement green community programs, or develop electricity from renewable energy resources. Demonstration projects that reduce peak electrical use also qualify. Public education campaigns to promote energy efficiency can also be funded.

How to Take Advantage of This Funding Please check with your municipal government for solar project opportunities through this program.

Solar for Schools (Enhanced funding for existing State programs) Summary

Appropriates $53.6 billion to a state fiscal stabilization fund. Specifies that states shall use 18.2% of this money ($9.75 billion) for public safety and other government services, including the renovation of facilities and schools to meet green building standards. Solar energy projects qualify and schools can use money to install renewable energy generation and heating systems, including PV.

How to Take Advantage of This Funding Please check with your municipal
government or local school district for solar project opportunities through this
program.

Green Collar Jobs (Enhanced funding for existing State programs) Summary
Appropriates $500 million to fund job training programs in energy efficiency and renewable energy. Also appropriates $250 million for rehabilitation and construction projects on Job Corps Centers, including energy efficiency and renewable energy projects. Job Corps has 122 centers in 48 states; new centers are slated to open in the two remaining states, New Hampshire and Wyoming. The solar industry in certain states is likely to be affected by an increase in regulations to use certified installers and electricians as local unions have begun to put pressure on governments for more stringent requirements and job classifications.

How to Take Advantage of This Funding Agency guidance will be provided by the
Department of Labor within 60‐90 days. Check the DOL website periodically for
updates.

Solar Water Treatment Plants (Enhanced funding for existing State programs)
Summary Provides $6 billion for the State and Tribal Assistance Grants account ($4 billion for the Clean Water State Revolving Funds and $2 billion for the Drinking Water State Revolving Funds). To ensure that the funds are used immediately to create jobs, the money must be committed to projects under contract or construction within 12 months of the date of enactment. The bill requires that not less than 20 percent of each Revolving Fund be available for projects to address green infrastructure, water and/or energy efficiency, or other environmentally innovative technologies. The bill allows States to use less than 20 percent for these types of projects only if the States lack sufficient applications.

How to Take Advantage of This Funding These projects will be announced based on
an open‐bid RFP. Please check with your municipal or state government for solar
project opportunities through this program

Department of Interior Funding (Agency specific appropriations) Summary

Appropriates $125 million to BLM for the management of lands and resources and suggests funds be used for renewable energy rights‐of‐way and related permitting projects. Allocation of these funds and expediting and enhancing the processing of renewable energy projects right‐of‐ways and related permit applications is anticipated.

How to Take Advantage of This Funding These projects will be announced based on an open‐bid RFP. RFPs will be listed on a website and search engines can be set up to help to track new business opportunities and RFPs as they come out.

Solar for the Military (Agency specific appropriations) Summary Appropriates $300 million for DOD research, development, testing and evaluation of projects to improve energy generation, transmission, and energy efficiency. Appropriates an additional $100 million for Navy and Marine Corps facilities, and further specifies that funds are for energy efficiency and alternative energy projects.

How to Take Advantage of This Funding These projects will be announced based on an open‐bid RFP.

Tax Provisions Repeals Penalty for Subsidized Energy Financing Allows businesses and individuals to qualify for the full amount of the solar tax credit, even if projects receive subsidized energy financing (e.g. below market loans, tax preferred bonds, state grants etc.). This amendment shall apply to periods after Dec. 31, 2008.

Extends Bonus Depreciation Last year, Congress temporarily increased the amount (50% of the cost of capital investment) that businesses could write‐off for capital expenditures incurred in 2008 to $250,000 and increased the phase‐out threshold for 2008 to $800,000. The bill would extend these temporary increases for capital expenditures incurred in 2009. Accordingly, until the end of 2010, business taxpayers are allowed to write‐off up to $125,000 (indexed for inflation) of capital expenditures subject to a phase‐out once capital expenditures exceed $500,000 (indexed for inflation).

5‐Year Carryback of Net Operating Losses For tax years 2008 and 2009, extends the maximum carryback period for net operating losses from two years to five years. Eligible small business may elect to increase the carryback period for an applicable 2008 NOL from two years to any whole number of years elected by the taxpayer that is more than two and less than six. An eligible small business is defined as a taxpayer meeting a $15,000,000 gross receipts test. (see Sec. 448(c)) An applicable NOL is the taxpayer’s NOL for any taxable year ending in 2008, or if elected by the taxpayer, the NOL for any taxable year beginning in 2008. However, any election under this provision may be made only with respect
to one taxable year.

Remedy for AMT and R&D Credits in Lieu of Bonus Depreciation Where a taxpayer is in a loss position, deductions in excess of income are unable to enjoy the benefit of bonus depreciation. This provision extends the allowance in the Foreclosure Prevention Act of 2008 that permits AMT and loss taxpayers to receive 20% of the value of their old AMT or R&D credits to the extent such taxpayers invest in assets that qualify for bonus depreciation. The amount is capped at the lesser of 6% of outstanding and unused AMT and R&D credits or $30 million. The extension of the additional first‐year depreciation deduction is generally effective for property placed in service after December 31, 2008. The extension of the election to accelerate AMT and research credits in lieu of bonus depreciation is effective for taxable years ending after December 31, 2008.

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