Montana solar 101: must read before you buy solar panels

The Solar Investment Tax Credit (ITC) allows homeowners to claim 26% of the cost of their solar power system installed until 2022 as an income tax deduction. For example, if your solar system costs $20,000, you are eligible for $5,200 (26% of the total gross cost) in tax credit. Solar system cost comprises not only the money spent on solar panels, but also freight shipping costs, professional installer fees, tools bought or rented and so on. To claim the ITC, complete all the necessary forms and submit them when filing your taxes.

This program allows you to recover up to 100% of the costs associated with acquiring a PV system, including installation. The limit is set at $1,000 per household with two married taxpayers, or $500 per individual. The credit may be carried forward for four taxable years. The Residential Alternative Energy System Tax Credit is compatible with all other credits and incentives. It means that you can claim it together with the federal 26% ITC. Before applying, make sure your system is new and meets all relevant safety and performance standards.

Solar laws in Montana make Net Metering programs available to customers of all investor-owned utilities. Also, a draft Net Metering agreement has been signed by most electric cooperatives in Montana. The program gives households an opportunity to send the excess electricity back to the grid instead of storing it with battery banks. When you sell your solar power to the utility, you receive credits that can be used to offset your next bills. In Montana, their value is equal to full retail electricity price. If you accumulate any unused credits, they will expire at the beginning of the year, either in January, April, July or October. The customer gets to choose when the cycle starts.

Renewable Energy Credits are certificates granted to any person or entity upon generation of each MWh of clean electricity. Unlike with Net Metering, you don’t need to sell any electricity to get credits. The value of RECs is always changing, which makes them similar to stock market assets. Based on the available data, selling RECs could mean anywhere from $300 to $1,000 annually for a 10 kW solar system. To participate, you have to apply for certification from the Montana Public Service Commission. After that, you can create a REC account with Western Renewable Energy Generation Information System (WREGIS) or Midwest Renewable Energy Tracking System (M-RETS) to begin storing and selling your credits.

The program allows homeowners in Montana to take a 10-year loan to cover costs associated with acquiring an alternative energy system. The loan amount is limited to $40,000 and no down payment is required. All proposals are assessed and approved by the Department of Environmental Quality. The projects are then ranked according to such criteria as reliability, return on investment (ROI) and avoided fossil fuel consumption. Use this checklist to get ready and apply.

A solar PV system installed in a home increases its value by about 4%, says 2019 Zillow report. In Montana you don't have to pay extra taxes during the first few years. According to the state laws, 100% of the value added as a result of a solar PV system installation shall be exempt from taxation for 10 full assessment years. The maximum amount of added value to be exempt is limited to $20,000. To claim the exemption, use Form AB-14.

A solar easement contract is a written agreement between you and another party, for example, your neighbor. This type of contract helps to protect a reliable supply of sunlight for your solar panels. A solar easement guards your panels from potential impairments, such as vegetation and structures. It is voluntary and must contain the description of protected space, a list of restrictions and a clause on revision or termination of the contract. Once signed, it is tied to the land, not the owner. Any such agreement must be created in written form and must meet the general requirements for easements on real property.

It is legal to install solar panels on your house in Montana. However, there is no statewide legislation that makes it unlawful to restrict installation of solar PV systems, so it’s best to contact your HOA or study its declaration and rules to find out more. You may have to submit your project for approval before changing the exterior of your house. The board may ask you to hide the system from view, reduce the number of panels or just reject your proposal.

Montana is threatened by wildfires, floods and severe winter storms. These disasters come hand in hand with infrastructure damages that interfere with both generating plants and power lines. Your PV modules are designed to handle most natural hazards, and that’s good news in case of a blackout. Almost every summer comes with Public Safety Power Shutoffs. As the wind picks up, temperature rises and the trees are getting drier, the electricity in certain high-risk areas is turned off, leaving many Montanans without electricity. The Environmental Protection Agency warns that extreme weather events are becoming more frequent and powerful, adding to the list of reasons to opt for solar.