Nova Alternative Energy Systems

Toll Free: 1-866-639-0552

FAQ’s

  1. What is the best time to take advantage of federal incentives?
  2. What are energy Investment Tax Credits/Grants?
  3. How did the Federal grant programs get started?
  4. What is the background of the grants and can I get more information?
  5. What is accelerated depreciation?
  6. How is depreciation basis calculated?
  7. Why should I get Solar for my business?
  8. How will solar help boost my bottom line?
  9. How can I generate additional income from my solar system?
  10. Why is solar for my home?
  11. Will solar cost less that my electric bill?
  12. Is solar a smart investment?
  13. Will solar really increase the value of my home.
  14. Will solar really help the worlds energy needs?
  15. Is solar efficient?
  16. What is the process for owning a solar power system?
  17. What is the Initial Site Visit, Property Inspection and Energy Analysis?
  18. What is a system design and estimate?
  19. . What is required in the initial paperwork, rebate application & permitting?
  20. How do you obtain job materials?
  21. How is the system installed?
  22. What is system commissioning?
  23. What is the final rebate payment request and what happens after the project is complete?
  24. How much does it cost?

What is the best time to take advantage of federal incentives?

» The best time to take advantage of incentives is NOW.
• Currently, the Federal Government is offering a 30% tax grant, that can be taken in lieu of the established renewable energy 30% tax credit. This means that after your installation, you can get a check from the Federal Government, rather than waiting to reap the benefits during tax season. However, the tax grant is only valid for systems installed up to 12/31/2010! So call today to get started!

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What are energy Investment Tax Credits/Grants?

» The federal tax credit, the federal buisness energy investment tax credit, the Carryback, Carryfoward provisions, and the 30% Federal Tax Credit:
The 30% Federal Tax Credit:
• Allows businesses to offset their income taxes when they purchase a solar power system. The IRS tax code also allows for the tax credit to provide AMT relief.
The federal business energy investment tax credit
• available under 26 USC § 48 was expanded significantly by the Energy Improvement and Extension Act of 2008 (H.R. 1424), enacted in October 2008.
• This law extended the duration -- by eight years -- of the existing credits for solar energy, and allowed taxpayers to take the credit against the alternative minimum tax (AMT), subject to certain limitations.
• The credit was further expanded by The American Recovery and Reinvestment Act of 2009, enacted in February 2009.
Carryback / Carryforward Provisions:
• A commercial solar tax credit that a taxpayer cannot use can be carried back one year. If there is still an unused credit, then the credit can be carried forward 20 years.
The 30% Federal Tax Grant:
• Allows businesses to accept a grant payment IN LIEU of waiting for the aforementioned tax credit.
• Administered through the U.S. Department of Treasury, the cash grant will be issued as a check to the eligible applicant within 60 days of eligible solar equipment installation.
• The American Recovery and Reinvestment Act of 2009 (H.R. 1), enacted in February 2009, created a renewable energy grant program that will be administered by the U.S. Department of Treasury. This cash grant may be taken in lieu of the federal business energy investment tax credit (ITC). See the program web site for more information.
• Only tax-paying entities are eligible for this grant program, and the grant will not count towards the applicant's taxable income.

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How did the Federal grant programs get started?

» The federal Energy Policy Act of 2005 (H.R. 6) expanded the federal business energy tax credit for solar installed in 2006 and 2007. These provisions of the tax credit were later extended through December 31, 2008, by Section 207 of the Tax Relief and Health Care Act of 2006 (H.R. 6111).
• The Energy Improvement and Extension Act of 2008 (HR 1424) greatly extended the duration and terms of the tax credit available to business owners.

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What is the background of the grants and can I get more information?

» • More information on the Federal Grant can be found at http://www.treas.gov/recovery/docs/guidance.pdf
• The American Recovery and Reinvestment Act of 2009 (H.R. 1, Div.B, Sec. 1104 & 1603) established the authority for the Grant.
• Business energy credits are claimed by attaching Form 3468 to one's tax return.
• http://www.irs.gov/pub/irs-pdf/f3468.pdf
General Business credits are claimed by attached Form 3800.
• http://www.irs.gov/pub/irs-pdf/f3800.pdf
Authority: Section 48(a)(3) (Investment Credit: Energy Credit) of the IRS tax code.
• Title 26: http://www.dsireusa.org/documents/Incentives/US02F.htm

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What is accelerated depreciation?

» • For solar property placed in service after 1986, the current Modified Accelerated Cost-Recovery System (MACRS) property class is five years.
• For more information, see IRS Publication 946, IRS Form 4562: Depreciation and Amortization, and Instructions for Form 4562. The IRS web site provides a search mechanism for forms and publications. Enter the relevant form, publication name or number, and click "GO" to receive the requested form or publication.
The depreciation schedule is as follows:
Year 1 Depreciation Rate of Recovery Period
1 20%
2 32%
3 19.2%
4 11.52%
5 11.52%
6 5.76%

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How is depreciation basis calculated?

» For the purpose of calculating depreciation on a commercial solar system, the "tax depreciation basis" is a distinct value - separate from the tax credit basis. The tax depreciation basis that the taxpayer claims for the solar equipment must be reduced by 50% of the tax credit.
Formula:
Tax Depreciation Basis = System cost x (50% x 30% x System Cost)
Or
Tax Depreciation Basis = 85% x System cost
Where can I find more information?:
For more information, see:
• IRS Publication 946 (http://www.irs.gov/pub/irs-pdf/p946.pdf),
• IRS Form 4562: Depreciation and Amortization (http://www.irs.gov/pub/irs-pdf/f4562.pdf) , and
• Instructions for Form 4562 (http://www.irs.gov/pub/irs-pdf/i4562.pdf).

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Why should I get Solar for my business?

» 1. More control over your operating costs?
• With solar energy, you can plan your costs today and well into the future. You know what you will pay next year and the following for the solar energy you produce. Without solar, your utility will dictate your energy costs and you'll just have to pay their bills with little recourse.
Lower or stabilize your energy costs?
• Why pay more for the electricity you need anyway? The cost of electricity produced by solar is actually less than the electricity you buy from your utility.
A smart investment.
• Not only does solar cost less, but with SRECs, you will actually make money. Paying your electric bill provides a negative NPV. With solar, and the associated incentives, you can actually achieve a positive NPV.

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How will solar help boost my bottom line?

» You will stop “renting” your electricity from the Utility Company.
• Own the electricity you generate and start seeing substantially reduced, or even eliminated electric bills.
• Protect against rising electric rates. While everyone else's bills are going up, watch as your bills decrease.
• As rates continue to rise, your solar system will be even more valuable as it will save you more money each year!
Q: What kinds of incentives are there to buy a solar system?
A: Federal tax incentives and state rebate programs to help pay your system off sooner.
• Federal Investment Tax Credit OR Federal Tax Grant
• Accelerated Depreciation
State Rebate Programs

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How can I generate additional income from my solar system?

» From the sale of your Solar Renewable Energy Certificates (SRECs)
• For every Megawatt-hour generated, a SREC is created.
• Each state is different, but based off of data from the NJCEP, in New Jersey, for example, SRECs created from a small 100 kW system could generate tens of thousands of dollars annually...all as added income!

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Why is solar for my home?

» Increasingly, homeowners, businesses and governments are turning to solar energy as a way to power their electricity needs.
• Why? Well, most people believe it is because solar power systems generate clean energy and are a solution to global warming.
• Although, this is very true and benefits are enormous, more and more governments are recognizing the many other benefits that solar energy systems provide, and adding incentives to help more people go solar.

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Will solar cost less that my electric bill?

» Solar costs less than electricity from your utility:
• Why pay more for the electricity you need anyway?
• The cost of electricity produced by solar is actually less than the electricity you buy from your utility-especially considering how much electric rates are going to continue increasing.

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Is solar a smart investment?

» Yes
• Not only does it cost less, but with SRECs, you will pay your system off quickly and then make money!
• Plus, right now you can take advantage of generous state and federal incentives as well as financing options to help make sure solar is cost effective for you.

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Will solar really increase the value of my home.

» Yes your home value will increase:
• Your home will actually increase in value with solar because new home buyers will have a lower energy bill than a comparable home without solar.

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Will solar really help the worlds energy needs?

» Solar lessens our countries dependence on fossil fuels:
• The cost of extracting the fossil fuels to power America is going up considerably.
• When environmental, transportation, exploration, and political factors are accounted for, electricity from solar energy systems is a more sustainable way to grow our economy and lessen our dependence on other energy-rich nations.

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Is solar efficient?

» Solar is a more efficient way to power our homes and buisnesses:
• With solar power being produced by the end users, less investment required into the utility's transmission and distribution grid (which is aging considerably and in desperate need of upgrades) as well as into peaking power plants.
• The more solar power systems deployed across the grid, the less investment is needed into those ugly power lines and polluting electric generation stations.

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What is the process for owning a solar power system?

» Our experienced solar specialists follow the 7 steps presented below to ensure each client is fully satisfied with all aspects of their solar electric system.

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What is the Initial Site Visit, Property Inspection and Energy Analysis?

» • Upon contacting us, a representative will conduct a telephone interview and gather specific information about your interest in a solar power system.
• They will also schedule a site visit with one of our solar specialists.
• Upon arrival to your property, our solar specialist will conduct a survey of your property and determine the optimal location of your system based on factors such as available space, access to sunlight, and maximum system energy production.
• The Solar Specialist will also conduct an assessment of your energy usage and evaluate what size system best fits your needs.

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What is a system design and estimate?

» • Based on the information collected in step 1, our Solar Specialist provides a system design with expected performance measures and all costs associated with system ownership.
• They will also show you how to take advantage of the lucrative Federal and state solar incentives that significantly lower the cost of a solar energy system, as well as advice for different financing options.
• Since we do this at no cost to you, we request that all family members be present for the site visit and presentation and we ask that you provide a current electric bill for our review.

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. What is required in the initial paperwork, rebate application & permitting?

» • Upon agreement to move forward with the project, our Solar Specialist will lead you through all the paperwork necessary to be approved for federal and state incentives.
• Depending on the incentive, we will even manage and submit the paperwork to the agencies providing the incentives. (Unfortunately, the federal government won't allow us to submit your tax returns for you to get your tax credits - you'll have to do this yourself.)
• At this stage, we also collect a small deposit to get started.
• The state of NJ allows us to prepare, manage and submit your rebate application for you.
• We also obtain authorization to connect your system up to your utility provider (so your meter will spin backwards) and request all permits necessary to install your system on your home.

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How do you obtain job materials?

» • Upon rebate, interconnection, and permit approval, we proceed with ordering your system from our equipment suppliers.
• We work with the leading manufacturers in the industry providing state-of-the-art modules, inverters, and mounting systems to ensure your system will perform as expected over the next 30 years.

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How is the system installed?

» • Upon receipt of the equipment, a Nova representative will contact you to schedule your installation.
• Upon arrival of our installation professionals to your home, we conduct a final walk-through and make sure no site changes have occurred that alter the original design.
• Next, we attach the module mounting system to your roof. The modules are then attached to the mounting system and connected to a junction box that leads to your inverter.
• As our roofing specialists install the modules, our electrical experts mount the inverter(s) to an available wall-space usually in your garage or basement and then connect the modules to the inverter.
• Finally, we connect the inverter to your circuit breaker box so you can generate electricity for your home.

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What is system commissioning?

» • Upon completion of the system installation, we conduct a final system walk-through with you and explain how the system operates.
• If you ever have any questions about the operation of our systems, most of our staff own their own system so you can just give us a call.
• After final walk-through, we then schedule all necessary inspections by local permitting authorities, rebate administrators and your utility.

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What is the final rebate payment request and what happens after the project is complete?

» • Once all your inspections are complete, we submit the final request for payment of your rebate.
• We offer to our clients the option of assigning the rebate to us as a form of payment so you don't have to pay more upfront and then wait for the rebate. We do the waiting so you don't have to.
• Where applicable, we also set up your solar renewable energy certificate (SREC) account so you can immediately start generating and selling your SRECs.

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How much does it cost?

» • You will pay less for solar electricity than you will for the electricity you are currently purchasing from your utility company. This is because state and federal governments have recognized the vast benefits solar provides, and have enacted incentives to help make solar feasible for homeowners.
• While exact costs will vary depending on the specific conditions of your home, here is what a typical residential system in New Jersey could cost:

System Sizes 6kw
System Production 6,900 khw
Annual Electric Savings
(0.18/kw electric rate) $1,242
Annual SREC Income
(conservative $475/SREC) $3,277
Total Annual Income $4,519
Cost of System $33.000
Less 30% federal Tax Credit $3,277
Cost after tax credit $23,100

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