Delaware Division of the
Public Advocate

New Solar Incentives

Date Posted: Friday, September 18th, 2015

Beginning Sept. 21, the Green Energy Fund for Delmarva Power & Light (DPL) customers will implement new solar incentives, DNREC’s Division of Energy & Climate announced today. The Green Energy Fund provides grants to DPL customers for small scale solar and geothermal installations. All applications received on or after Sept. 21 will be reviewed under the new incentive levels. The Delaware Electric Cooperative’s (DEC) Renewable Resource Program and the Delaware Municipal Electric Company (DEMEC) programs are not affected by this announcement.

“Rebate levels for the DPL Green Energy Fund program are being lowered due to a significant increase in applications, the lower cost of materials in the solar market and an increase in leased systems which do not need large incentives to make them economically feasible,” said Energy Program Administrator Robert Underwood, Division of Energy & Climate. “These lowered rebate levels will still support systems that are economically feasible for homeowners, solar power purchase models (PPAs) and lease companies.”

With the decreasing cost of solar coupled with the increasing popularity of solar lease and PPAs, the Division of Energy & Climate has seen a dramatic increase in Green Energy Fund applications. In 2013 the Green Energy Fund (GEF) received 284 applications, and in 2014 the number doubled to 571. For 2015, approximately 1,300 applications are projected. More than 80 percent of the applications received this year are under the newer PPA/lease financing model, which requires no money down on the part of the lessee, thus driving the increase in applications. The recent rapid growth in solar power installations, changing industry economics and limited funding have led to a 200 percent increase in applications and an unsustainable backlog of up to 36 months in grant disbursements.

The new GEF solar incentive levels are based on market conditions and recommendations from the Green Energy Fund Review and Recommendations Final Report conducted by the Vermont Energy Investment Corporation (VEIC). The incentive levels are being reduced from a maximum of $15,000 for residential solar system to $3,300 for customer-owned systems and $1,000 for PPA/Lease systems. In addition, non-residential solar systems are being reduced from a maximum of $24,000 to $3,000. Lastly, the non-profit solar systems are being reduced from a maximum of $50,000 to $41,250. The new incentive levels will continue to keep the multi-year net present value (NPV) of these solar systems above zero, so that customers see a positive return on their investment.

“We understand that the changes in incentives will affect the solar energy business in the short term, but not addressing the backlog would be far more harmful,” Underwood added. “We look forward to working with stakeholders to assist with this transition of the Green Energy Fund.”

For more information on the new GEF incentives, please visit DNREC’s Green Energy Page.

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