Government Alternate Energy Plan Leaves Home Owners Holding The Bill

Hi Building Solar News friend,

Don’t get me wrong, I love the fact that the Obama administration has set aside more than $787 Billion in stimulus of which some of that includes renewable energy grants. It’s a positive step forward.  It beats the $2K limit that was there hands down.

My problem comes in that it does little for the lower and middle class who need the help most with the ever increasing costs of energy.  You see, while the new alternative energy program is giving 30% of the cost of both materials and installation as a cash grant to businesses direct from the Dept. of Treasury… Private citizens that wish to do the same are only allowed to take a 30% cost of materials and installation cost Tax Deduction.

No outright grants for home owners at all!

For those of you that aren’t good with numbers, I’m going to show you what that really means.

Business buys a $30,000.00 solar system including parts and installation.  Uncle Sam gives them $9000.00 cash direct from the US Treasury to help pay the bill.

30,000 – 9,000 (30%) = $21,000 paid for the system after the government grant.

Now, let’s look at what happens to the private citizen who buys the same system.

30,000 system = 9,000 tax deduction.  If your taxable income was 50,000 and you were in the 20% tax bracket, that would mean that…

50,000 @ 20% tax = 10,000 in taxes.  50,000 – 9,000 = 41,000 @ 20% tax = 8200 in taxes.

In other words, while the business got a $9,000.00 grant, the private home owner only sees $1,800.00 in real tax break.  Again, while it’s better than the $2,000.00 limit that it used to be for the total deduction… the new policy really only gives home owners a few hundred dollars more than it used to.

That’s not anywhere close to what is needed for most home owners to afford the cost of alternative energy sources such as solar, wind or geo thermal. The new policy just leaves private citizens holding the bill for not only the stimulus package itself… but for any alternative energy systems they might wish to use themselves.

Wes Waddell

www.BuildingSolarNews.info BLOG

www.SpidersMarketingWeb.com

Tags: passive solar designs, solar home building