Apollo SunErgy Solar Energy News

Go Green with Environmentally Friendly LED Lighting

user.nospam@nospam.example.com (reelectric) — Sun, 15 Nov 2009 18:03:00 -1200

LED ADVANTAGES

There are a number of benefits to be gained from the use of LED lighting.

Efficiency

LED's are extremely energy efficient and consume up to 90% less power than incandescent bulbs. Since LEDs use only a fraction of the energy of an incandescent light bulb there is a dramatic decrease in power costs. Also, money and energy is saved in maintenance and replacement costs due to the long LED lifespan.

Because of the low power usage of the LEDs they are becoming extremely popular for light sources in remote areas that use solar panels.

LEDs do have a higher initial cost than incandescent and compact fluorescent light bulbs, but the cost is quickly recouped over time in lower electricity costs.

Longevity

LEDs have a lifespan of up to 100,000 hours compared to the 1500 hours for incandescent bulbs. A LED lighting device can last up to 11 years under constant use. On average LED bulbs last up to 10 times as long as compact fluorescent bulbs and 133 times longer than typical incandescent bulbs. Long lifespan of LEDs will dramatically reduce maintenance costs and lower long-term operating costs to traditional incandescent and fluorescent tubes.

LED Lifespan Scenarios

Up to 100,000 powered 4 hours a day, Equal to 68 ½ Year Lifespan
Up to 100,000 powered 8 hours a day, Equal to 34 Year Lifespan
Up to 100,000 powered 24 hours a day, Equal to 11 ½ Year Lifespan

Durability

LEDs are solid state lighting devices that utilize semiconductor material instead of a filament or neon gas. LED light is a tiny chip encapsulated in an epoxy resin enclosure, which makes LEDs far sturdier than traditional incandescent light bulbs or fluorescent tubes. LEDs do not use fragile components such as glass and filaments which means LEDs are able to withstand shock, vibration and extreme temperature.

Safety

Improved safety may be one of the most important benefits of LED lighting. LED lights generate virtually no heat. Let me repeat no heat. This means LED lights are cool to the touch and can be left on for hours without incident or consequence if touched. LEDs produce 3.4 btu's/hour compared to 85 btu's for incandescent bulbs. The downside of incandescent is they expel 90% of the energy it consumes via heat. And as all of us know incandescent light bulbs get hot, real hot to the touch. LED lighting reduces the potential for safety risks of burns and fires.

Environment

LED lighting devices are made from non toxic materials, unlike fluorescent lighting that uses mercury that may pose a danger to the environment. LEDs are also recyclable and considered “Green or Earth Friendly”.

Color

LED lights are offered in a variety of base colors such as Red, Green, Blue, Yellow, Amber and White. Because traditional incandescent light bulbs use filters to produce colors, they are extremely inefficient. LEDs can be blended to produce colors and are extremely efficient. LEDs can be blended to produce millions of color options.

LED Lighting Features and Benefits Overview

Efficiency: LEDs use up to 90% less power than traditional lighting.
Longevity: LEDs have up to 100,000 hour Lifespan (11 ½ year powered 24 hrs/day)
Durability: LEDs are much more rugged than traditional lighting.
Safety: LEDs generate virtually no heat. Safe to the touch and reduce fires.
Environment: LEDs are made from non toxic & recyclable materials.

Get Solar Panels Without the Upfront Costs - Power Purchase Agreements

user.nospam@nospam.example.com (reelectric) — Sun, 01 Nov 2009 17:00:00 -1200

Wikipedia defines a Power Purchase Agreement (PPA) as:

"...a legal contract between an electricity generator and a power purchaser. The power purchaser purchases energy, and sometimes also capacity and/or ancillary services, from the electricity generator. Such agreements play a key role in the financing of independently owned (i.e. not owned by a utility) electricity generating assets."

If you are interested in gaining the benefit of solar power without investing a lot of money upfront or worrying about the responibility of owning and maintaining solar equipment, this might be the perfect route. This is how a PPA works, after the power purchase agreement is settled, we would purchase the solar panels on your behalf. Depending on the agreement, there might be a nominal installation fee (we have to pay our employees for part of their time), but we would install the panels on your property and we would be responsible for maintaining and repairing the panels.

After installation is complete and the panels are producing green energy, you would pay us a fixed-rate monthly fee, based on how much energy the solar panels produced.

Now you can get clean, natural energy without making a huge initial investment. Call Apollo Sunergy today, and let us help you plan for the future.

Accounting for PV System Rebates

user.nospam@nospam.example.com (reelectric) — Tue, 20 Oct 2009 15:59:00 -1200

Until recently, I assumed that federal tax credits for PV systems were based on the net cost of the system after subtracting any utility rebates. But a newsletter I received indicates that the 30% investment tax credit is based on the total PV system cost, before subtracting the state incentive. Is this accurate?

This depends on whether your customer is a homeowner or a business. The distinction hinges on the terms personal tax credit and investment tax credit. The Database of State Incentives for Renewable Energy (DSIRE) makes this distinction, for example. On the DSIRE Web site (dsireusa.org), the “Residential Renewable Energy Tax Credit” is described as a personal tax credit, whereas the “Business Energy Investment Tax Credit” is identified as a corporate tax credit. Personal and corporate tax codes are quite different, specifically with regards to the way one accounts for utility rebates.

Homeowners.
For most homeowners who purchase a grid-tied PV system, there are two principal financial incentives: a rebate and the federal tax credit. The rebate is usually available from the utility to which the system is connected. The federal tax credit takes the form of a personal tax credit (PTC) that is available to the homeowner. When a rebate is available from the utility company, the rebate is treated as a purchase price reduction. This means that the value of the rebate is subtracted from the total purchase price, resulting in a net adjusted cost for the purposes of determining the value of the federal tax credit. So, for homeowners the value of the PTC is calculated as follows, where P is the purchase price and R is the rebate amount:

PTC = (P – R) x 30%

Prior to January 1, 2009, the federal tax credit for homeowners was capped at $2,000. This made for pretty simple math, since this cap was reached on all but the smallest PV systems. For example, assuming a rebate of $3.50 per watt, a purchase price of $12,750 ($8.50/watt) and a 2008 placed-in-service date, the $2,000 cap for the Residential Renewable Energy Tax Credit is exceeded even on a 1.5 kW grid-direct PV system:

PTC = ($12,750 – $5,250) x 30%
PTC = $7,500 x 0.30
PTC = $2,250 ≥ $2,000 cap

With the passage of the Emergency Economic Stabilization Act of 2008, the $2,000 cap on the PTC for PV systems was lifted, and tax credits for solar were extended for 8 years. Residential grid-tied PV systems installed between January 1, 2009 and December 31, 2016 qualify for a full 30% tax credit. For a 5.6 kW PV system with a purchase price of $46,200 ($8.25/watt) and a 2009 placed-in-service date, an additional $5,980 PTC ($7,980 - $2,000) results compared to a 2008 placed-in-service date, under the same $3.50 per watt rebate:

PTC = ($46,200 – $19,600) x 30%
PTC = $26,600 x 0.30
PTC = $7,980

Two items are worth noting before we look at how the federal tax credit is calculated for businesses. First, according to version 2.0 of the Solar Energy Industries Association (SEIA) Guide to Federal Tax Incentives for Solar Energy, “Most rebates from state governments or non-profit organizations do not reduce the basis for the federal credit.” So make sure you know where your rebate comes from and its tax classification. Second, dwelling units with a home office serve a dual residential and commercial purpose. So while depreciation in general is unavailable to homeowners, those with an in-home business may be able to depreciate the portion of the PV system that qualifies according to the IRS as commercial property, usually on the basis of a square foot determination.

Businesses.
In addition to rebates and federal tax credits, commercial customers who purchase grid-tied PV systems are also entitled to a third major financial incentive: depreciation. Depreciation is a mechanism for spreading out the cost of acquiring large capital items over time. Solar projects, even though they have a 25-year service life, qualify for 5-year accelerated depreciation. Furthermore, systems placed in service in 2008 and 2009 also qualify for bonus depreciation. These PV systems are still depreciated over 5 years, but they can take 50% the first year and 12.5% in each of the succeeding 4 years. Originally, the bonus depreciation of 50% in year one was available only for systems placed in service in 2008, and it expired on January 1, 2009. But the American Recovery and Reinvestment Act, signed into law by President Obama on February 17, 2009, reinstates bonus depreciation for PV projects completed in 2009.

Unlike the PTC, the commercial tax credit--usually referred to as the investment tax credit (ITC)--can be calculated in two different ways. The first process is the rebate-first method, which is the same as for homeowners. In this case, the busi- ness subtracts the rebate amount from the purchase price of the PV system and uses the net difference to determine the ITC amount. The second approach is the ITC-first method. In this case, commercial property owners apply the ITC to the full purchase price first and then treat the rebate as taxable income. This is the method mentioned in the newsletter you received. The formula for calculating the ITC in this case is simply to take 30% of the purchase price:

ITC = P x 30%

The ITC-first method results in a larger basis for the tax credit and for the 5-year accelerated depreciation plus bonus depreciation. If the business reduces the purchase cost of the PV system by the value of the utility rebate, then the depreciation is based on this adjusted value. If the business does not reduce the system cost by the value of the utility rebate, however, then depreciation is based on the nonadjusted purchase price. This results in a significantly larger depreciable basis.

In either case, before depreciation is calculated, it is necessary to first reduce the purchase price by one-half of the value of the federal tax credit. So using the rebate-first method of accountin--the purchase price reduction method--the depreciable basis (DB) for a 12.5 kW PV system sold to a business for $100,000 ($8.00/ watt) with a $3.50 per watt rebate is calculated as follows:

DB = (P – R) – (0.5 x ((P – R) x 30%))
DB = ($100,000 – $43,750) – (0.5 x (($100,000 - $43,750) x 30%)
DB = $56,250 – (0.5 x ($56,250 x 0.3))
DB = $56,250 – (0.5 x $16,875)
DB = $56,250 – 8,437.50
DB = $47,812.50

Compare this to the depreciation basis using the ITC-first method of accounting:

DB = P – (0.5 x (P x 30%))
DB = $100,000 – (0.5 x ($100,000 x 0.3)
DB = $100,000 – (0.5 x $30,000)
DB = $100,000 – $15,000
DB = $85,000

The ITC-first method results in a much more attractive basis for depreciation. It also leverages a larger federal tax credit. But does it actually provide the best financial return?

As illustrated in Table 1, the ITC- first method does indeed provide the most favorable return. This leverages a $30,000 tax credit, as well as depreciation totaling $22,848 (assuming a 28% marginal tax rate and a 4% discount rate.) This requires that the business treat the $43,750 rebate as taxable income, but the tax on the rebate is only $12,250 ($43,750 x 28%). Taking the rebate first leaves $23,121 on the table (($30,000 + $22,848) – ($16,875 + $12,852)). Therefore, taking the ITC first and taxing the rebate nets the business nearly $11,000 in this example.

This is the reason that the newsletter you received recommends taking the ITC on the total PV system cost. In his excellent article “Payback and other Financial Tests for Solar Elec- tric Systems,” Andy Black of OnGrid Solar (ongridsolar.com) confirms this approach. He notes, “While it might seem obvious to avoid the rebate tax ... it is actually financially more attractive to claim the rebate as taxable, pay the tax, then claim a higher basis for each of the federal tax credit and depreciation.”

Please note that this review of incentives is based on information contained in the Federal Tax Code and bills recently signed into law. This is not to be construed as tax advice. Always consult a tax professional. SEIA members can download the tax manual for free from its Web site at seia.org.

Source:—Peter Parrish, Ph.D. / California Solar Engineering / Los Angeles, CA / calsolareng.com The author wishes to thank Sue Kateley of CALSEIA for her input and review of this article.

APOLLO SUNERGY LOOKS TO FUTURE IMPROVEMENTS NEEDED FOR THE 2010 SOLAR GREEN PROJECT

user.nospam@nospam.example.com (reelectric) — Tue, 06 Oct 2009 15:22:00 -1200

(LAUREL, MD) - Apollo SunErgy, a subsidiary of Ridgeway and Ernest Electric, and the Independent Electrical Contractors (IEC Chesapeake) is currently discussing improvements needed to make the 2010 Solar Green Project another success story. Apollo Sunergy is pushing to expand the program and allow more students to get involved in this invaluable experience and make sure the program runs as smooth as possible.

Earlier this summer Apollo SunErgy participated in a partnership between the Woodland Job Corps Center, Anne Arundel Community College and IEC Chesapeake to teach lower income high school students how to install solar panels. It took the students two weeks to install and use the solar panels at the Social Development Center at the Woodland Job Corps Center.

"The successful completion of this solar installation program was a proud moment for all of us," Apollo SunErgy President Don Bonnet said. "We want to make next year’s program even better and help more of our community through vocational training of our youth."

View more news videos at: http://www.nbcwashington.com/video.

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Apollo SunErgy was established to provide reliable and cost-effective solar energy to our customers in Maryland, Virginia, District of Columbia, and surrounding areas and cities, including Delaware, Pennsylvania, and New Jersey. We provide reliable and honest service to homeowners and businesses that are looking for ways to reduce their electrical utility costs with clean, renewable solar energy.

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