Green technology is the wave of the future, not just in Silicon Valley, but across the globe as well and we can all play a part in improving the environment by utilizing alternative means for generating electricity. As each individual makes an investment into global preservation by making the decision to include solar panels on their investment properties, or any alternative energy method, they have enforced the greater good principle which we should all consider during our time here on earth. This especially includes those of us who are lucky enough to own real property improved with structures. Non-owner occupied property owners are increasingly considering solar energy into their property management plans and for good reason.
Tax credits for calendar year 2018 equal approximately 30% of the total cost of the solar panel installation which continues to drive installations via a tax strategy. Presently the 30% tax credit is modified downward in 2020 and sunsets completely by 2022. However, each year brings opportunity for Congress or state legislatures to modify, extend or even improve these incentives.
The depreciation schedule for the solar panel installation is 20% in year 1, 32% in year 2, 19.2% in year 3, 11.52% in years 4-5, and 5.6% in year 6, thus your equipment is fully depreciated in 6 years – an accelerated depreciation schedule may provide additional incentives for non-owner occupied property owners who are seeking tax advantaged strategies.
It is estimated that property values increase approximately 6-7% when solar panels are installed subject to geographical locations and quality of installation. A non-owner occupied property owner who is attempting to improve their property efficiencies and improve overall property management get the added benefit of selling to tenants that the energy costs are lower than similar properties in the same marketplace. Imagine your advertisement; “Solar Panels – No Electricity Costs.”
Self-Generation Incentive Program (SGIP) Provide Additional Benefits
Established in 2001, the California energy storage rebate (SGIP) program supports a varying array of “behind the meter” systems or technologies that can be installed at your home or business. These systems can include energy storage systems, fuel cells, and combined heat and power generators.
Previously SGIP was difficult to obtain for residential customers because most of the program funds were taken quickly by industrial-sized energy storage projects, leaving nothing left for homeowners.
PG&E Customers are Eligible for Incentives
Importantly, homeowners who are customers of either PG&E, SCE, or SDG&E will be eligible for an incentive as high as $400 per kilowatt-hour (kWh) when one installs a home battery system. That incentive should be enough to cover most of home battery costs. The total value of the per-kWh incentive depends on the size of the battery purchased and can be reduced as more batteries are installed in the state. As with a lot of technologies it will probably pay dividends to be an early adopter of home batteries.
Solar Kit Solutions of Saratoga is Our Local Solar Panel Expert
Bill Hedgpeth of Solar Kit Solutions can provide consultation, estimates, and practical solutions to any property owner in California. Non-owner occupied property owners seeking to gain a competitive advantage over similar investment/rental properties can improve the overall property management efficiency and return-on-investment for their investment or rental properties by installation of solar panels. Contact Bill Hedgpeth today for your free evaluation – http://solarkitsolutions.com/ – 1.408.253.4000.
David currently is the broker/owner of Silicon Valley Property Management Group (SVPMG) which manages 150+ client properties on the San Francisco Peninsula.Trust, transparency, and performance guarantees are the foundation of SVPMG. David challenges anyone to find a PM company that offers services similar to the extensive education, customer service, and performance guarantees provided by SVPMG.
David also provides consulting for his clients on property development feasibility, construction, and complex real estate transactions.
David has authored a published law review article, two real estate books, and over 120 real estate blog articles.