What led to the new Oregon solar incentive program?

Until 2017, Oregon homeowners could apply for the Residential Energy Tax Credit (RETC) when they installed a solar system on their home. Residents would receive a tax credit of $1.30 per watt of installed solar capacity, up to $6,000.

This was one of the best solar incentives in Oregon; when combined with the federal solar tax credit, homeowners could potentially cover half of the cost of their solar electric system. 

Homeowners were scrambling to get their solar projects done before the April 1, 2017 deadline, in order to qualify for the RETC. This led to a short-lived burst in the number of solar projects in Oregon. 

Residential solar panel installations used to qualify for an Oregon state tax credit. Without it, solar became more expensive. Image source: Bend Magazine

However, that boost in the Oregon solar industry didn’t last long. Without the RETC, which was the main solar incentive in Oregon, the payback period of a solar system in the state nearly doubled and left many homeowners unable to afford solar systems for their homes. 

In order for Oregon to meet their goal of becoming 50% renewable by 2040, it was important to make solar affordable. It was especially important to make solar power accessible to low-income homeowners, as these consumers benefit the most from the electric bill savings solar panel systems provide. Plus, making solar accessible to more people leads to more installations, which, in turn, can help Oregon reach its renewable energy goal. 

With these intentions in mind, the Oregon legislature passed House Bill 2618 (HB 2618) in June 2019, which established the Solar + Storage Rebate Program.

This Oregon solar incentive program provides rebates to homeowners, both low-income and non-low income, and to service providers in low-income areas who install solar panel systems. 

How to qualify for Oregon’s Solar + Storage Rebate Program

This Oregon solar incentive program is available to low-income service providers and low-income residents. 

To qualify as a low-income service provider, you must provides services, like financial or health services, to low or moderate-income residents. All residential customers can apply to the Solar + Storage Rebate Program, but your income will determine how much your rebate will be.  

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In order to receive the new Oregon solar incentive, the solar panel system must be installed by an Oregon Department of Energy-approved contractor. A list of approved contractors can be found here. The contractor will then submit an application for the solar project. 

Residential solar installations 

The residential incentives are divided into two categories: 

  • Low and moderate-income (LMI) household rebates; and 
  • Non-income restricted residential rebates. 

Oregon low and moderate income incentive – how to qualify and how much it’s worth 

To be considered for the low and middle income incentive, the total household income must be at or below 60% of Oregon’s median income.

The following table displays the state’s median income amount per household size and outlines the maximum income you can have to be considered for the low income incentive: chart displaying income guidelines for oregon solar incentive

If you qualify as a low income household, you will receive a rebate of $1.80 per watt of solar installed. The rebate amount cannot exceed 60% of the net cost of the system and it cannot go over $5,000. 

If battery storage is also installed, you will receive an additional incentive equal to $300 per kilowatt hour (kWh) of storage installed. The storage rebate amount cannot exceed 60% of the net cost of the storage system and it cannot go over $2,500. 

Oregon non-income restricted incentive – how to qualify and how much it’s worth 

If you do not qualify as a low income household, you can apply for the non-income restricted residential rebate instead. If you qualify for a solar rebate from your utility, you will get a rebate equal to $0.20 per watt of solar installed. 

For example, customers of Ashland Municipal Electric Utility can take advantage of the utility’s Solar Electric Rebate Program. This rebate program pays you $0.50 per watt of solar installed. If you chose to get the rebate from Ashland Municipal Electric, you will get $0.20 per watt of solar installed through the Oregon Solar + Storage Rebate Program plus the $0.50 per watt installed from Ashland Municipal electric. 

If you do not qualify for a solar rebate from your utility, you will get a rebate equal to $0.50 per watt of solar installed from the Oregon Solar + Storage Rebate Program. The rebate cannot equal more than 40% of the net cost of the solar system and it cannot exceed $5,000.

When you include solar energy storage with your solar system, you can receive an additional incentive. The storage incentive for a non-income restricted household is equal to $300 per kWh of storage installed. The storage rebate cannot exceed 40% of the net cost of the storage system and it cannot go over $2,500.

How much will you save with Oregon’s Solar + Storage Rebate Program?

For example, let’s say there are three homes and each one belongs to one of the residential incentive categories. Each of these houses installs a 7.6 kilowatt (kW) Tesla solar panel system on their roof.

The solar rebate received by each household would be as follows: 

Customer type Incentive rate (per watt installed) Total solar rebate amount
LMI $1.80 / watt $5,000
Non-income restricted with utility incentive $0.20 / watt $1,520
Non-income restricted, no utility incentive $0.50 / watt $3,800

If a battery storage system that includes two 13.5 kWh Tesla Powerwalls was installed with each of those solar panel systems, the storage incentives received would be as follows:

Customer type Incentive rate (per watt installed) Total solar rebate amount
LMI $300/kWh $2,500
Non-income restricted with utility incentive $300/kWh $2,500
Non-income restricted, no utility incentive $300/kWh $2,500

So, for a 7.6 kW Tesla solar panel system with a two-Powerwall battery storage system, the following shows the total Oregon Solar + Storage rebate each of the residential categories would receive:

Customer type Total solar + storage rebate amount
LMI $7,500
Non-income restricted with utility incentive $4,020
Non-income restricted with no utility incentive $6,300

The Oregon Solar + Storage Rebate combined with the federal solar tax credit would provide each of these three homeowners with significant savings and cut back the payback period for the solar-plus-storage system by up to 10 years in some cases!

Low-income service providers 

Non-residential incentives are available to organizations that are considered low-income service providers. Low-income service providers include:

  • Owners and developers of affordable multifamily housing that are also eligible for public assistance through the Oregon Housing and Community Services;
  • Community service organizations that have the primary purpose of offering health, dental, social, financial, or other services to households below 100% of the state median income by household size; or
  • Tribal or local government entities that use public buildings to provide services to LMI individuals or that provide emergency shelter during emergency and disaster situations.
solar panels on a school roof
Some schools may qualify for a solar rebate as low-income service providers. Image source: Environment America

Low-income service providers will get a rebate equal to $0.75 per watt of solar installed. The solar rebate cannot exceed 50% of the net cost of the solar energy system and it cannot go over $30,000. For example, if a school installs a 25 kW system that costs $50,000, it would receive an incentive of $18,750. 

 

If that school decides to install battery storage as well, it will get an additional incentive. The low-income service provider battery storage incentive is equal to $300 per kWh installed. The rebate cannot equal more than 60% of the net costs of the battery system and it cannot exceed $15,000. 

How is the Oregon Solar + Storage Rebate Program funded?

Oregon’s solar incentive program is funded by The Rooftop Solar Incentive Fund. The money in this fund comes from many sources, including:

  • Money transfered into the fund through a Legislative Act, 

  • Money donated to the fund, and

  • Money deposited from public or private sources. 

The money in this fund is used exclusively for the Oregon Solar + Storage Rebate Program, which is administered by the Oregon Department of Energy
blue solar panels on a garage in a suburban neighborhood
Sunbridge Solar, one of the Oregon Department of Energy’s approved solar contractors, installed this system in Portland, Oregon. Image source: Sunbridge Solar

There is currently $2 million in the Rooftop Solar Incentive Fund. HB 2618 mandates that at least 25% of the total funds must go to LMI households and low-income service providers. So, low income applications will be prioritized over applications that are considered non-low income. 

Also, no more than 50% of all funds can go towards non-residential projects. This is to prevent the whole budget being taken up by non-residential projects, which can receive incentives as high as $45,000. If there was no cap, these installations could end up using a substantial portion of the budget. 

The application is submitted by a certified solar contractor. From there, the rebate will be given directly to the solar installer, who will then decrease the cost of your installation accordingly.

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New incentive could boost Oregon’s solar and storage industry

When the RETC ended back in 2017, the Oregon solar industry took a hit. With less people able to afford solar, there were less home solar installations. This led to job losses within Oregon’s solar industry.

Between 2017 and 2018, the number of solar jobs in Oregon dropped by over 300. There was a 21% decrease in the number of solar manufacturing jobs and an 11% decrease in the trade and distribution of solar. 

For Oregon to meet their renewable portfolio standard goals, the state needs their solar industry to grow, not shrink. The Solar + Storage Rebate Program could do just that. The incentive has the potential to encourage more Oregon residents to switch to solar, and the potential to encourage more battery storage deployment.

Oregon’s location also plays a factor.

Recently, Oregon’s neighbor, California, has been experiencing an energy crisis like we’ve never seen before. Utilities are starting to implement planned safety power shutoffs, where they turn off the electricity of both their commercial and residential customers in order to help prevent wildfires. 

wildfire and smoke in the california hills

With these power shutoffs happening more frequently and so close to home, the people of Oregon might start feeling concerned that their access to power could be at risk soon, too. Plus, Oregon is a coastal state, so they’re feeling the impacts of climate change harder than some other states located in the middle of the country. 

With increased flood, wildfire, and storm risks, Oregon homeowners may start making the production of their own energy a priority. This would allow them to have power even in the event of a grid power outage. Again, the introduction of the new incentive could be what pushes people who are feeling concerned about their power supply to switch over to solar-plus-storage. 

Between the new Solar + Storage Rebate Program and Oregon’s location, 2020 has the potential to be a big year for Oregon’s solar industry. 

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