Turning on the Power: What Happens After Your Solar Panels Go Up?
In this blog, we’ll take you on a comprehensive journey through the post-installation process of your solar system.
Estimated Reading Time: 6-7 minutes
Welcome to GraySquare Solar’s Knowledge Base! If you’re a homeowner who’s just had solar panels installed or you’re considering going solar, you’ve come to the right place. In this blog, we’ll take you on a comprehensive journey through the post-installation process of your solar system. You’ll gain insight into what happens after your solar panels go up, from interconnection to PTO, and understand the timeline for SRECs and tax credits. Our aim is to make the transition to solar energy as smooth as possible for you. So, let’s dive right in!
A Brighter Way to Cook: Eco-Friendly Cooking
Step 1: Application
After your solar panels are installed, your solar installer will submit an application to your local utility company. This initiates the interconnection process, and you can expect this to take anywhere from a few days to a few weeks.
Step 2: Site Inspection
The second step in the interconnection process involves a site inspection carried out by your local township or municipal authority. This inspection ensures that your solar PV system meets safety and technical standards and complies with local regulations. The timeline for this inspection can vary but typically falls within two to four weeks after the initial application.
Step 3: Permission to Operate (PTO) and Meter Upgrade
Once your system passes the site inspection, you’ll receive Permission to Operate (PTO) from your utility company. PTO is a significant milestone, granting you official permission to begin generating electricity from your solar panels. However, it’s important to note that some utility companies may require a meter upgrade before granting PTO. This upgrade can take an additional 4-8 weeks, extending the overall timeline. Be sure to check with your utility provider to understand their specific requirements.
Net Metering: Maximizing Your Solar Savings
Net metering is a crucial component of your solar journey. It’s a billing arrangement that allows you to receive credit for any excess electricity your solar system generates and feeds back into the grid. When your solar panels produce more electricity than your home consumes, the surplus is sent to the grid, and you earn credits on your utility bill. During times when your solar system isn’t producing enough power, such as at night, you can use these credits to offset your energy costs.
Net metering effectively turns your electric meter into a two-way device, allowing you to both import electricity from the grid when needed and export your excess solar energy when available. This arrangement not only reduces your energy bills but also contributes to a more efficient and sustainable energy grid.
The Ins and Outs of SRECs
“Solar Renewable Energy Credits (SRECs) are a sweet bonus of going solar,” notes the U.S. Department of Energy. These credits can be sold to utility companies, providing an extra income stream. SREC programs differ by state, and it may take a few months to start receiving SRECs after your system goes live. Be sure to check your state’s specific SREC program timeline. To learn more about SRECs, check out our latest blog here
Navigating Solar Tax Credits
What is the Federal Solar Tax Credit?
The federal residential solar energy credit, often referred to as the Federal Solar Tax Credit, is a financial incentive designed to make solar energy more accessible and affordable for homeowners in the United States. It allows taxpayers to claim a tax credit for a portion of the costs associated with the installation of a solar photovoltaic (PV) system.
This tax credit extends to various renewable energy sources, but for the purpose of this discussion, we will focus on solar PV systems. To claim this credit, your solar PV system must be installed in your residential property, and the installation must be completed within the tax year.
The Federal Solar Tax Credit underwent some recent changes, which are as follows:
- Solar PV systems installed in 2020 and 2021 were eligible for a 26% tax credit.
- In August 2022, Congress passed an extension of the Investment Tax Credit (ITC), increasing it to 30% for installations conducted between 2022 and 2032.
- Systems installed on or before December 31, 2019, were also eligible for a 30% tax credit.
- The tax credit will gradually decrease to 26% for systems installed in 2033 and further to 22% for systems installed in 2034.
- Starting in 2035, the tax credit is set to expire unless renewed by Congress.
- Notably, there is no maximum limit to the amount that can be claimed, making it a valuable financial benefit for those investing in solar energy.
Am I Eligible to Claim the Federal Solar Tax Credit?
To determine your eligibility for the Federal Solar Tax Credit, consider the following criteria:
- Installation Date: Your solar PV system must be installed between January 1, 2017, and December 31, 2034.
- Residential Location: The solar PV system should be located at a residential property within the United States.
- Ownership: You must either own the solar PV system outright, meaning you purchased it with cash or through financing, without leasing the system or paying a solar company to purchase the electricity generated by the system.
- Community Solar Project: If you have purchased an interest in an off-site community solar project, you may still be eligible for the tax credit, provided that the electricity generated by the project offsets and does not exceed your home’s electricity consumption. It’s important to note that specific circumstances may apply, and eligibility should be verified.
- New Installation: The solar PV system must be new or being used for the first time. This credit applies only to the “original installation” of the solar equipment.
By meeting these criteria, you can potentially claim the Federal Solar Tax Credit, which can significantly reduce the overall cost of your solar PV system, making it a more appealing and cost-effective choice for environmentally conscious homeowners. Please consult with your tax advisor or the IRS for precise details regarding your eligibility and the most up-to-date information on this valuable incentive.
The Journey to a Fully Operational Solar System
Your solar system is up and running, and now it’s time to ensure it operates efficiently for years to come.
Step 1: Monitoring
You can monitor your solar system’s performance through an app or online platform provided by your installer. Regularly checking your system’s performance ensures any issues are detected and addressed promptly.
Step 2: Maintenance
Solar panels are low-maintenance, but they do require occasional cleaning and inspection. Consider having a professional inspect your system every 1-2 years to ensure optimal performance.
Step 3: Upgrades and Expansion
As technology advances, you may want to explore upgrades or expanding your solar system. Keep an eye on new developments and incentives to maximize your solar investment.
By the time you finish reading this blog, you’ll have a thorough understanding of the post-installation process of your solar system, including the essential steps and typical timeframes. We hope this information empowers you to make the most of your investment and take full advantage of the benefits that solar energy offers.
In Conclusion
If you have any questions or need further assistance on your solar journey, don’t hesitate to reach out to GraySquare Solar. We’re here to help you harness the power of the sun and guide you through the entire process. To learn more about the benefits of solar energy, or if you’re ready to take the next step in going solar, please give us a call at 1-610-776-9901. We’re committed to making your transition to clean, renewable energy as seamless and rewarding as possible. Happy solar powering!