It’s a common question that homeowners and business people who have solar on their roof get from their friends and neighbors.
“When the power goes out in your area, if you have solar at your home, doesn’t your power stay on?”
Unfortunately, as solar owners know, the answer is usually no.
When your local utility experiences a blackout, as long as your solar system is connected to the electrical grid, then you’re blacked out too.
See how one local Virginia business with solar panels, White’s Wayside, a restaurant and bakery in Churchville, explained this situation to its customers on Facebook:
We’ve gotten the question recently of why our solar panels didn’t work this weekend when we experienced major power outages. We thought it was a good question and needs to be explained in detail.
Solar panels can be either on the grid or off the grid. To be off the grid, you need batteries that are very expensive and not yet developed to efficiently meet our needs. Therefore, our solar panels are on the grid. This means that when the sun is shining, we are generating a tremendous amount of power that goes into the electrical line and our meter, literally, runs backwards. When there is a power outage, the system is designed to shut down so that no power is going on the line because it could cause serious injury to the electric repair persons who are working in the field to get power back to the community. Therefore, when our neighbors lose power, so does White’s Wayside…even in the sunshine.
Grid-Tied Solar and Battery Backup
Tying solar to the grid is a good system for everybody.
It provides 24/7 power to a solar homeowner while allowing their neighbors to use clean energy without having to install their own solar system. Paying solar homeowners to sell their extra power back to the grid through a “net metering” program like we have in Virginia even keeps electricity costs down for people who don’t have solar, as numerous studies have shown.
But tying a solar system to the grid doesn’t protect solar homeowners from blackouts. For that, you need something besides solar panels. You need batteries on site to store power as a backup. Then, if there’s a blackout, you can draw on the power you’ve stored in your batteries.
Until recently, batteries were too expensive to be worthwhile for most homeowners who went solar. But in the last few years, the price of batteries has come down by more than 50%, putting storage into the price range of more and more solar owners. Drops in equipment costs have already made batteries cost effective in big solar markets like Hawaii and California. And in a few years, battery prices will come within reach of solar homeowners in other states.
Recently, help to make batteries even more affordable has come from a surprising place — the Internal Revenue Service.
You Can Now Add Batteries to Solar Later and Still Get the 30% Tax Credit
This week, the IRS ruled that a couple who installed solar panels on their home in the past can add batteries later on and still qualify for the 30% federal tax credit on solar equipment. While the ruling applied specifically to those homeowners, typically such rulings also set a precedent for everyone else in the same situation. This means that the IRS is basically saying that anyone who’s gone solar at home can now add batteries later on and still get the solar tax credit on the batteries.
That’s big news. Until now, it was common knowledge that if you installed batteries at the same time as you installed solar panels, that the batteries would qualify for the tax credit. But everybody thought that if you waited until after the solar panels were installed and decided to put in batteries later, that you missed the window to get the tax credit on the batteries.
Apparently, now, we’ve learned that’s not the case. According to the IRS, even if you install solar first and then wait to put in batteries a few months later, as long as the batteries are used to back up the solar panels, then you can still apply the 30% tax credit to the cost of the batteries.
How much longer can you wait from installing solar panels to get the batteries and still apply the federal tax credit? Some articles say you can wait up to 12 months after getting a solar array to add batteries, but the timing appears to be a bit unclear. Hopefully, we’ll get some more guidance soon on this issue.
For now, the ruling “marks a milestone” for the residential storage-plus-solar industry, according to Kelly Speakes-Backman, CEO of the Energy Storage Association.
“The 30 percent credit is like jumping ahead five years on the cost curve for home battery systems—so on that count, customers will be able to afford longer-duration systems sooner and present greater opportunity for self-reliance,” she said.
That’s exciting and we look forward to installing more batteries for solar systems in Virginia — in the future.
For now, we do need to be realistic. Batteries are still expensive. Given the electricity market in our state, the extra cost for battery backup still doesn’t make sense for most homeowners in Virginia who want to go solar.
In a few years, I hope that will change.
In the meantime, some people will find that batteries are worthwhile, especially those who are currently off grid or whose locations have a special need for backup power. For example, if you live in a rural area where the power goes out multiple times a year, solar with batteries could be a good alternative to your noisy diesel generator.
If want to go solar and have a special need for backup power, we can help you determine whether the extra cost of batteries is worthwhile at your location. And even if you already put in solar in the last few months but just want to add batteries now, we can help you figure out if batteries would qualify for the 30% federal tax credit.
Just request a free quote and we’ll give you our best advice on going solar, whether it’s solar with storage on site or with a more conventional grid-tied solar system.
— Andrew Brenner, Main Street Solar
