Solar in North Carolina is an incredible investment thanks to the state tax credit of 35%. The North Carolina renewable energy tax credit has created a vibrant solar market in the state, and gives potential buyers a huge incentive to go solar. This tax credit sits in limbo with its expiration coming at the end of 2015. Currently, a solar project needs to be installed and connected to the grid before the clock strikes midnight on December 31st.
So what is going to happen to the North Carolina solar market on January 1st of 2016? Even if the tax credit is allowed to expire, the financials will still be favorable for those seeking residential and utility scale projects. Residential, utility scale and commercial solar all benefit from the decreases in system cost that have come over the past several years. For residential property owners, the investment in solar will continue to make good financial sense due to high utility rates. For utility scale developers, the cost reductions on materials combined with the efficiencies gained from experience will keep the numbers working for investors. Although each market segment will see a minor decline, the major decline will be commercial rooftop projects. The commercial market will decrease due to the low utility kWh rates combined with demand billing structure, the increased capital cost and lack of third party interest in financing these projects. A current piece of legislation in the state called the Energy Freedom Act or HB245, if passed, will improve the financing aspect, but the increase in capital cost and commercial rate structure will still act as a deterrent for potential commercial solar buyers.
Commercial property owners that capitalize on the current incentives will see fantastic returns on their renewable energy investments. For commercial property owners in North Carolina looking to lower costs and switch to clean energy, the clock is ticking.