Five Trends in Solar Energy for 2021 in New York State
By: Leo Weigman
The massive 5,500 page COVID-19 bill that Congress approved and President Trump toyed with not signing and then signed after all contains good news for the renewable energy sector.
1. Federal tax credits for 2021 remain at 26%, same as 2020,
The federal tax credit for renewable energy dropped from 30% to 26% a year ago on January 1, 2020, and was scheduled to drop again to 22% on January 1, 2021. The good news is COVID bill froze the tax credit at 26% for two more year through the end of 2022. The tax credit is a meaningful incentive for both homeowners who are going solar as well as commercial investors. As the Solar Energy Industry Association reported, “There is bipartisan consensus on many of these issues, and we look forward to working with the incoming administration and the 117th Congress on future pro-solar policies even as we are grateful to this Congress for their actions today.”
2. More roof areas will be game for installing solar panels.
The efficiency of solar panels has climbed steadily in recent years, while the cost has seen a tenfold reduction in the past twenty years. Technological improvements mean today’s solar panels harvest more energy per square foot of panel than 5 years ago. That means they can be placed in areas that we used to consider suboptimal due to orientation (e.g. facing northeast or northwest instead of south). New York State (NYSERDA) has lowered the threshold of what qualifies for a full incentive in reflection of these advances. As Barry Cinnamon stated in Greentechmedia, “(I)t now makes economic sense to install modules on all unshaded roof orientations.”
3. Integrating energy storage (batteries) with solar will continue to increase market penetration.
While New York State does not yet have direct incentives for residential energy storage, like we have for solar, a battery system can be eligible for the federal tax credit when fed by a solar system. Battery systems have multiple benefits. They can provide resilience during grid outages. They can store solar energy not used during the day and dispense it after dark. They can shave peak demand for commercial building owners. The number of battery options from manufacturers is rising steadily, especially of battery components pre-engineered to be compatible with solar energy. We expect pricing on battery systems to continue to fall as more products reach the market.
4. Community solar farms will grow dramatically to offer solar for the rest of us.
Many of us are not able to put solar on our own home. But all of us can subscribe to a shared solar system located somewhere nearby. New York State has allowed large solar systems to be set up as community solar projects to which local homeowners and businesses can subscribe. These solar systems are often located on large commercial rooftops or on ground-mounted parcels. The subscribers save money over what the local utility would charge for energy supply. The site owner earns a lease payment for the roof or land under the solar farm. Everybody wins!
5. Electric vehicles chargers will become very popular options for solar systems.