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Boston councilor proposes city tax break for residential solar panels

City Councilor Matt O'Malley (Jamaica Plain, West Roxbury) today proposed a property-tax exemption for residents who convert their homes to solar power.

The break would be similar to how the federal government used to give tax breaks to purchasers of hybrid and electric vehicles, he said at a City Council meeting today.

Councilor Tim McCarthy (Hyde Park, Roslindale, Mattapan) said any such break should eventually expand to include small businesses as well.

Councilor Tito Jackson (Roxbury) added that the tax incentive could tie into social enterprise; in February, a Los Angeles-based solar panel company hired former gang members to help install the panels on people's roofs.

The council sent the proposal to the Committees on Ways and Means and Environment and Parks for further review.

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at city parks and playgrounds.

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this is a tax break for the rich as poor people can't afford solar panel installations.

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No rich people on my block, but my neighbor is getting panels installed this week.

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Now they make money.

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A friend of mine got hers through a service. They install and own, and she gets a discount on the electricity.

You can still essentially rent your roof even if you can't afford to buy them.

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When you sign up with a company that retains ownership of the panels, they put a lien on the deed to your house. They call it something else and insist it's not a lien, but the realtors and real-estate lawyers all say that it is. This doesn't matter until you try to refinance your mortgage or sell your house. You can't do those things until you clear the lien from your deed. That costs you money.

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Do they all do it? We are solicited by solar panel companies who do the roof-rent thing all the time. My neighbors and I have talked about maybe doing it in the future, after we get a new roof next year. A lien would be a deal breaker for me, though I'm not sure how they would do that with a condo-ized three decker. Put a lien on the master, or on the individual deeds?

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I was told by some solar guys at some event that it wasn't feasible to put solar panels on a flat roof which does rule out a lot of boston housing stock. I'm assuming snow issues but who knows? I was bummed--if you or anyone knows differently, do tell!

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... using tilted supports, just like solar panels placed on the ground.

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Check out the JP Greenhouse. Entirely solar powered, even in most of the winter. The only trick was that she had to go up in harness during this last winter and squeegee the heavy snow off to make them work (and lighten the load on the roof).

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Some residential solar companies don't do it. I have a shallow roof, and asked the company that installed the panels if they could tilt the panels to a more optimal angle. They said they didn't do that. (This was five years ago, and they were the better of the two companies I got to respond at all; things may be better now.) Tilted panels are common on industrial and commercial buildings that usually have flat roofs. Some towns are now putting PV panels on the roofs of their schools, and those would be flat roofs, too.

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But that's what the guys told me at the time. I'll keep asking around. Maybe the maintenance on a larger flat roof is cost-prohibitive for these installation-in-exchange-for energy companies. But yeah--it's hard to imagine that it's really not possible.

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A condo's master deed can't have liens. All ownership is divided up to the units. It's one of the defining characteristics of a condo. For the same reason, a condo association doesn't pay property taxes -- the unit owners do.

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Accounts vary. I have seen some sites saying "They all do it," and others saying "this company does it," but not talking about others. I don't know if it's universal. I don't know where to find out, either. If the FHA or FTC or CFPB were to say something, I'd believe them. Not so much if a panel-leasing company denied it; as I said, the companies identified as doing it all deny that it's a lien, since they call it something else.

Before signing a contract with a solar-leasing company, I suggest having your lawyer examine it, with any possible lien clause as a particular concern.

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.

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Should be given to residents who have lived in the City for the last ten years. Forget about solar panels, save the poor and middle class.

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You might want to look into it.

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and more. Today panels make money and you can have people install them and essentially "lease" your roof. You don't need to offer people additional financial incentives for them to make financial sense. But most of all because this law screws about 95% of the city for the benefit of 5%. These tax breaks don't come off of the city's income. Those who benefit get their taxes reduced - but then everybody else has to make up the difference. About 65-70% of the city rents - they can't make the decision to put up solar and the owner isn't going to pass any savings along. If you live in a multifamily condo or apartment building - you likely can't benefit either. That's the vast majority of the city.

Realistically you need to be an owner and mostly of a single family or maybe a two family home to benefit from this - and what percentage of the city is that - 5-10%? If you want to do it - great - it's ecologically and economically advantageous in most cases. But don't ask the rest of the city to further subsidize you so you can make even more money.

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Yes, no condo building is likely to make the change, nor is any apartment building. I'm not sure Mr. O'Malley had even thought of it.

It's election year pandering to single-family homeowners (although I don't know if the good councilor has any opponents).

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He's unopposed, try again

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I mentioned it to perruptor above. And the last apartment I rented-- in Stonybrook, JP-- has solar panels. Maybe my landlord was an anomaly, and he did live in the building the first year we were there. But given how many small landlords Boston still has, I imagine that some would be game.

By the way, I'm not saying this to endorse the tax break. I agree with everyone who has pointed out that this would be a break for the people who least need it; also either buying panels or doing a roof-rental already covers financial benefits.

But, given that the one utility almost everyone has to pay in Boston is electricity, having solar panels so the electricity costs stabilize at a lower rate would be a good selling point for a rental apartment.

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^^^Stevil

It's hard to see what place solar tax breaks from the city have...unless the city had its own income tax.

(Ducks for cover)

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See this article that just came out in the Commonwealth Magazine:

http://commonwealthmagazine.org/environment/solar-powers-benefits-outwei...

Solar power is a cost-effective solution to our power needs because investments today will reduce everyone’s cost for electricity over time. Not just for people with solar power – for everyone. According to an analysis conducted for the state Legislature-appointed Net Metering and Solar Task Force, solar power delivers benefits to the people of Massachusetts that are worth more than twice as much money as it costs. A $2.77 return for every $1 invested.

How? First of all, adding more solar to our electric grid lowers generation costs for everyone– not just for those who actually have the solar panels on their roofs. That’s because right now, nearly all of the high cost of electricity in Massachusetts is caused by over-reliance on natural gas, which has to come from out of state. When the utilities and power companies need to create lots of power — especially during hot summer days when air conditioners are running — they have to buy more natural gas and start up inefficient (and polluting) oil-fueled power plants. Supply and demand pushes the cost of generating power higher and higher, and rates climb for all of us. Last winter, customer rates for electricity climbed a frightening 40 percent.

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Yup, renewable energy benefits everyone. Oil companies, who make more money than any company in the history of the world, get tax breaks. To allow that and not give breaks to solar users is plain dumb.

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The UHub regulars have never seen a council proposal they liked. You all complain about the council doing nothing, and then complain when they do do something.

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Much to be done in the city for the city.

But not by the august body known as the Boston City Council.

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I actually like this proposal. I don't know why homeowners (other than logistical problems) wouldn't want solar panels on their roof. They make money and the power company pays YOU (if you give back to the grid)

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As a Boston homeowner, I'm always flirting with the idea of adding solar panels. There seem to be a lot of hidden downsides of the roof-rental model (liens, as mentioned above, fees to remove panels if repairs are needed, etc), and the cost of outright buying and installing solar is still high.

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Buying your own panels is expensive, but if you have the money or can finance it reasonably, it pays for itself within a few years. We had ours put in when the state and federal tax refunds were more generous, so we only had to shell out 1/2 the total cost. The installer estimated that the system would pay for itself in 7 years. I think it took less than that. Paying $0 per month for electricity, plus the periodic SREC checks we get, makes it very good for us.

Also note that while a solar installation does make your house more valuable, the law says your tax assessment cannot be increased because of it.

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Great Idea, but it appears to already exist:

http://programs.dsireusa.org/system/program/detail/146

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Only the system itself is exempt - so say the system has a value of $20k and the house is worth $500k. the $20k is not taxed - but the $500k is still taxed.

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It would be for new construction only

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I didn't realize that. That is a pretty significant difference.

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I talked with reps from two solar companies. Sungevity and another company whose name I forget. Sungenvity said they would do the project while the second company said my roofs face the wrong direction. I believe that the ideal is to have a large surface that directly faces the south. Mine don't but Sungevity didn't see that as an impediment. Of course both companies used Google Map images to make the determination instead of sending someone out.

The options offered by Sungenvity:

Sell or lease the panels to me. If I buy the panels then I am responsibile for claiming any credits and rebates. If I leased then Sungevity gets the money back. Buying panels provided only 1 year warranty while a lease provided a warranty for the life of the lease.

Why I decided to not do this.

Buying panels: I believe that home based solar panels are still very new and don't want panels that will be obsolete in a few years. I'll wait. The cost was very high ($10,000?). Even with rebates (I didn't know of any tax credits) the pay back would take several years. By the time the panels paid for themselves (not including ocasional repairs) it would be time to replace the panels. So no savings. The likelihood that I would wind up with an excess of electricity that was not high. Plus it was a promise based on theory rather than a backed up guarrantee. Repairs: I don't know who would repair panels after the first year. That's another big unknown.

Leasing: If I wanted to sell my house the new buyer would have to accept the lease. That effectively acts as a lien since I could not sell without either buying out the lease or including the lease as part of property purchase.

In addition I was concerned that the company that I leased the panel from might not be around in the future. So the promise of maintaining the panels would amount to nothing.

Other concerns are these:

I've heard that solar generated electricity is actually sold to the electric company for a price and then the user receives a credit or payment. Meanwhile the user still has to pay for all of the electricity used in their house, rather than solar generated electricity directly offsetting what is needed from the electric company.

It is a risk that not enough solar generated electricity will be produced to offset the cost of purchase or leasing thereby making the overall cost higher.

Finally, based on my experience with the grotesque failure of at least one energy conservation contractor, I am at this point reluctant to hire anyone unless they have developed a sterling reputation over the past several years.

Given that home based solar panels are a still fairly new technology I am not confident in the wisdom of home based panels at this time. I'll put the money that would go toward solar panels toward more mature energy improvements such as high efficiency applaines, furnaces, better windows, etc.

As for the energy credit for home owners that is grossly unfair. That automatically will exclude many homes that don't roof styles and orientations that qualify for solar panels. There are already rebates available; these are financed by every electric bill in the form of the energy conservation (a nominal amount on each bill). That already pulls money from people who can't take advantage and gives it to people who can. Giving credits to the homeowners who could take advantage will result in adding to the burden on homeowners who can't take advantage, while not necessarily providing any indirect benefit if the solar panels wind up not performing as needed.

But it is an election year and regarless of the lack of a competing candidate our Councilperson has to give the appearance of working for his constituents, even if it's just smoke and mirrors and meetings. If only he put this time into helping consituents who need his help as a Councilperson. That would make him a good City Councilor.

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I've heard that solar generated electricity is actually sold to the electric company for a price and then the user receives a credit or payment. Meanwhile the user still has to pay for all of the electricity used in their house, rather than solar generated electricity directly offsetting what is needed from the electric company.

This is false. MA has net metering, which means that all power generated by home solar is fed into the grid, and is deducted from the accounting of the home's electric consumption. Special electric meters are used for this. If your normal monthly usage was 500 kWh, and your new solar panels generate 300 kWh, you will be billed for 200kWh. If you generate more power than you use, the difference shows up on your electric bill as a balance in your favor. I don't know if this is how leased-solar programs work. Their ads talk about a guaranteed lower electric rate, so they may take all of the credit, and use part of it to reduce your bill.

It's also not true that PV panels are a new technology. They've been available to homeowners for many years. What is true is that they are continually becoming more efficient and lower in cost. If you want to wait until the cost per kW drops dramatically, that's reasonable, but that drop is always being predicted as right around the corner, and hasn't really happened yet. Meanwhile, you're still paying the utility.

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