How to Pay For a New Alternative Energy System for Your Home or Business

How to Pay For a New Alternative Energy System for Your Home or Business
by Michael Edwards

In this edition of Green Products, let’s turn to financing. Many people are going through some hard times and some not so hard. You still want to go green in every way you can, but affording it right now may not be as easy as before. After taking a hard look at this challenge, here are some thoughts:

The first place to look for incentives is the manufacture. They are a business, and they are influenced by the economic downturn just like everyone else. They need to turn inventory to stay in business and that is why some are offering price reductions and rebates on green products.

Another opportunity is the new American Recovery and Re-investment Act of 2009. Renewable energy and the development of alternative energy products were given a big boost by removing “cost caps” from the 2008 alternative energy tax credit and green products.

It works this way: After you install the system, the IRS will allow you to deduct 30% of the total cost of product and installation costs from your next tax bill with no stated limit. This also means you can install multiple units or a combination of energy products. For example, a solar array and a windmill to supply energy to your home or business.

Third – what about your energy cost savings? Spending money on green products during this time may make more sense than you think. With businesses willing to negotiate, tax credits and a reduction in your energy costs, you are putting money in the bank over the long haul. If you plan well, your investment could pay for itself in months, not years.

At last count, 30+ states offer tax incentives, rebates and cash-back programs. The cash back programs require the utilities to reimburse you when you generate more electricity than you use.

This is a win-win situation for everyone involved. You get cheap electricity, the local business get installation contracts, the manufacturers sell a great product, the government gets payroll taxes and doesn’t have to pay for unemployment, and the environmental impact has been reduced with the use of green products.

Michael

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