ENERGY PAYBACK: Solar incentives vary by state, jurisdiction

By Joe Crocetta/Staff Photographer
Dave Mentzer, general manager of the Wetsuit Wearhouse at 400 S. Conococheague in Williamsport, stands with more than 100 solar panels on the company’s roof.

Chris Moleskie said going solar has made environmental and financial sense for his business, Wetsuit Wearhouse in Williamsport, Md.

“My goal was net-zero,” Moleskie said, meaning he wanted a solar power system to produce all of his company’s energy needs.

“So far, we are on track for that. … It’s a peak demand period, and we’re still doing great.”
Moleskie is the founder, president and chief executive officer of Wetsuit Wearhouse, which bills itself as “the largest wetsuit speciality shop in the world.”

He said being environmentally conscious has alway been a part of the company’s mission, and that it’s important to him personally and to his customers.

“It’s a cool thing that sets us apart from Amazon and other companies that are trying to do what we’re doing,” he said.

On the financial side, he said the solar system already is covering the company’s energy needs.

And he’s looking for a “strictly energy payback” of five to seven years for a system that will last decades.

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The solar project was the culmination of a years-long effort to get control of the company’s energy use.

Executives from companies that install solar systems urge following Moleskie’s approach to get the biggest bang for the bucks spent on a sun-powered system.

They also said that costs can vary widely depending upon the business and its energy goals, that government incentives vary from state to state, and that some incentives might not make sense for every business.

“Solar is a piece of the equation. It’s not the whole story,” said Colin Williams, vice president of sales and marketing for Mountain View Solar in Berkeley Springs, W.Va.

He compared the process to other building and capital issues.

“Before you buy a new air conditioner, fix the hole in the wall,” Williams said.

Solar executives also say sun power is hot in part because equipment is cheaper and more efficient than it used to be.
“Size matters,” said Phil Kelly of Millennium 3 Energy in Hagerstown, referring to large commercial installations.

What cost $4 a watt five years ago might cost $2 a watt today, he said.

‘Thinking solar long-term’

Moleskie said being environmentally conscious has always been part of the mission at Wetsuit Wearhouse, where everything that can be recycled is recycled.

“I was always thinking solar long-term,” he said, but first the company had to get a handle on its energy use.

“We could never afford a solar system that could power such a pig, so we had to trim the fat,” he said.

The building was insulated.

The company ditched its old boiler for an electric heat pump system that has a liquid-petroleum gas backup.

LED lighting and timers were installed.

“That alone saved us 30 percent on our energy usage,” Moleskie said of the lighting changes.

When it came time to install the solar system, he turned to Kelly’s company, Millennium 3 Energy.

“What I needed was an expert who could guide me through this process,” Moleskie said.

Like Moleskie, Kelly said preparation is critical, starting with the basics.

“You need a good roof,” he said.

In Washington County, he said, a structural engineer’s OK is required before rooftop panels can be installed on a commercial or residential building.

Positioning those panels also makes a difference.

“By far the best is to face them south or a few degrees from south and to tilt them,” he said.

Other orientations can work, some with only small percentages of difference in terms of efficiency.

Kelly and Williams of Mountain View Solar both said they also work with the business leaders, to assess energy use and determine the company’s goals for the system.

“Systems are based on energy needs,” Williams said.

They said most systems are tied into the regional power grid, using the electric utility as a backup or supplemental source of energy. When the solar system produces more than the company needs, a specially installed electric meter will run backwards, giving the company credit for that power.

When the building needs more energy than the system can produce, it takes electricity from the grid.

Batteries remain expensive, Kelly and Williams said, so relatively few customers opt for that type of system.

After the analysis at Wetsuit Wearhouse, Millennium 3 installed 100 rooftop panels late last year.
Those panels produce about 36,095 kilowatt-hours of electricity per year.

The energy is managed through two inverters that are mounted on a wall in a utility room, almost within arm’s reach of the old boiler. Each inverter provides an instant readout of how its part of the system is performing.
“I check my stats quarterly to make sure they’re in line with projections,” Moleskie said.

Paying for solar

Getting a system installed can be complicated.

“The rules vary from state to state, and state incentives vary as well,” Williams said.

To start, a solar power system is eligible for a federal 30 percent investment tax credit, according to Kelly and Williams.

“If you spend $100,000 on solar, you get $30,000 back on your taxes,” Kelly said. “That’s the big one.”

The 30 percent is set through 2019, he said, then it is scheduled to phase out.

The real value of that tax credit to an individual business also depends on a company’s overall tax burden, Kelly said.

In addition, Kelly and Williams said a business can depreciate up to 50 percent of a solar system in the first year.

Maryland also has a solar grant program based on size, up to $6,000, Kelly said.

“Maryland is solar-friendly because of that and some other things Maryland does,” he added.

There is still a market in renewable energy credits, Kelly and Williams said, but the value of those credits has dropped.
Williams said Pennsylvania once had a grant system, using money from a federal stimulus package. But those dried up as the stimulus money was spent.

Kelly and Williams said the real value of solar energy is realized over time.

“It’s a long-term investment. … Every time there’s a rate increase, your investment is solar energy is just becoming more valuable,” Williams said.