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©) 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.