INCENTIVES

REDUCE PROJECT COST

Curious about the differences between the Incentive Tax Credit and the Production Tax Credit?

Download our brief guide below to show how the credits compare for SunDrum Systems.

SunDrum Systems are eligible for a wide range of federal solar and renewable energy incentives.
Additional details can be found at the DSIRE Database.

Income Tax Credit (ITC)

Most residential and commercial projects are eligible for an Income Tax Credit (ITC) rebate equal to 30% - 60% of total project cost. Rebate details vary based on project parameters.

Note:

  • SunDrum qualifies for an increased commercial tax rebate (40%) because our Collectors are produced in the United States. (Hudson, MA)

  • Nonprofits are able to receive ITC funds directly as a grant rather than as a tax rebate.

30% Reduction (Tax Rebate)
Residential Systems

40% Reduction (Tax Rebate)
Most Commercial Systems

50% Reduction (Tax Rebate)
Systems installed in income-eligible areas

MACRS Depreciation

Commercial projects can take advantage of Modified Accelerated Cost Recovery System (MACRS) Depreciation, depreciating the full cost of the system over the first six years after purchase. The value of the benefit depends on a client’s tax rate, but generally ranges from 20-30% of project cost.

Note:

  • If the Income Tax Credit (ITC) benefit is taken, half of this ITC value must be removed from the depreciable basis.

  • If a client lacks the tax basis to fully claim depreciation, it can be claimed in future years.

20-30% Reduction (Accelerated Depreciation)
Most Commercial Systems

REAP Grant

Rural and agricultural projects can take advantage of the USDA Rural Energy for America Program (REAP) Grant, which offers grants (for up to 40% of project cost) and loans (for up to 75% of project cost) for renewable energy and sustainability projects for select businesses.

REAP Grants are available to entities meeting either of the following criteria:

  • Any Agricultural Producer

  • Small businesses (in any industry) operating in a city or town of < 50,000 residents

40% Grant OR 75% Low-Interest-Rate Loan
Eligible Commercial Clients

EXAMPLE SYSTEMS

Franchise / Chain Resort

Income Tax Credit (ITC):
MACRS Depreciation:
Net Cost (After Incentives):

40%
20%
40%

Low-Income Multifamily Project

Income Tax Credit (ITC):
MACRS Depreciation
Net Cost (After Incentives):

60%
16%
24%