DENVER—Solar-energy companies are thriving in Colorado despite a decline in incentives, with a sharp drop in the cost of solar-panel systems now driving the industry.
The question is whether costs can come down even more so that an incentive of 3 cents a kilowatt-hour will still draw buyers.
“We’ve seen cost come down for panels, for equipment, installations, even permits,” said Blake Jones, chief executive of Boulder-based Namaste Solar.
Since, 2006 Xcel Energy, the state’s largest electric utility, has offered incentives for residential and small commercial solar installations under its Solar Rewards program.
The program has provided more than $276 million in incentives to Colorado customers and installed nearly 15,000 photovoltaic systems, the company said.
According to the Denver Post ( ), the installed price for a solar system has dropped since 2004 from $9 a watt to less than $4.
The incentives come from a 2 percent charge on Xcel customer bills, which is running a $44 million deficit.
The Colorado Public Utilities Commission in 2012 agreed to reduce incentives and to cap the program to help address the deficit, which Xcel said could be erased by 2017.
Under an agreement, the first 4.8 megawatts of residential projects will get a 9-cents-a-kilowatt-hour incentive. When that is filled, the next 4.8 megawatts will be eligible for an 8-cent incentive.
The incentives will continue to drop in 4.8-megawatt steps to a 3-cent incentive.
The federal solar-investment tax credit is expected to be cut from 30 percent to 10 percent in 2016.
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Information from: The Denver Post,
