A recent EnergyNorthCarolina podcast about the rise of solar in the state says that installed costs for most homes are now 24 percent lower than in 2006. A system for a typical home can now be installed for $6,840 per kilowatt (kW) in the state, down from the $9,000/kW it would have cost in 2006.
As solar panel prices have dropped, the cost of installed solar systems (worldwide) is increasingly now made up of the cost of everything but the actual panel. The balance of the system— racking, the inverter (that converts the DC that the solar makes into AC, which is what is on the grid), customer acquisition, permitting and labor—now accounts for the lion’s share of the cost of a solar installation.
But solar costs still vary greatly from state to state, even though homeowners in every state are eligible for the 30 percent federal tax credit. That is because every state has its own incentives for solar, in addition to the federal tax credit.
In North Carolina, to meet the state renewable energy standard (RES) the investor-owned utilities must generate at least 12.5 percent of their retail electric sales from a combination of renewable energy and energy efficiency resources by 2021, including at least 0.2 percent of retail electric sales from solar energy.
Co-ops and municipal electric utilities in the state must meet a 10 percent requirement by 2018, including at least 0.2 percent of retail sales from solar energy.
Utilities can meet the RES not just by building their own clean energy, but by taking credit for your solar system. When you, as a North Carolina utility customer, install solar that generates power, you can sell the utility the REC for however many units of power you generated each year.
With RECs, the more power that your system generates, the more money you earn every year.
And even though it is you benefitting from the solar power you generate on your own roof (cutting your own energy bill), you can still earn money as well for doing so, from RECs. The logic is that, as more people must be supplied with energy, the new energy, even though you are using it, is still new electricity being generated that the utility did not have to pay to build. You are an energy supplier.
One REC is paid for each megawatt-hour of solar electricity produced, like in New Jersey, which has catapulted to No. 2 nationally because it uses (incredibly well-paying) solar credits as incentives. In Pennsylvania, so many people got in to selling their (solar) SRECs that the price crashed.
Since passing the North Carolina REC bill in 2006, till the end of last year, a total of over 128 megawatts of solar power has been installed, among 1,142 solar systems across the state. That’s the equivalent of building one small coal plant right there.