As an example, consider
the experience my wife and I had when we purchased a two collector solar domestic hot water system in May of this year.
The
final after tax installed cost of our system was $7,386 and this is the amount the dealer must be paid (although you do have the option
of not paying pst at the time of purchase.) However, after incentives totaling $3,987 are applied, our net cost will drop to
$3,399 for a savings of 54 percent. I use the term “will drop” because you have to apply for most of the incentives and you
may have to wait for your next income tax refund to realize all of the savings.
The prerequisite for eligibility for most of the following
incentives is that you must have an ecoEnergy Home Energy Evaluation performed on your home. However, even the cost of this
may be subsidized by the provincial government.
So, here is how the incentives break down.
We were able to enjoy a $500
early booking discount on our system, although, I understand this is no longer available.
Without the early booking discount,
the system cost would have increased to $7,964 and the total of the other incentives would have increased to $4,213 so the net cost
would have been $3,751 for a savings of 53 percent.
At the federal level, a $1,250 grant was available through the ecoEnergy Retrofit – Homes program.
Also, we will be able to claim a $958 Home Renovation Tax Credit on our 2009
income tax return. The tax credit is based on 15 percent of eligible expenses between $1,000 and $10,000 which are incurred
before February 1, 2010.
At the provincial level, the PEI Energy Efficiency Grant Program will reimburse us for $1,108 which is 15 percent of the total amount
of the cost of the system (the system must be recommended in the Home Energy Evaluation report).
Lastly, there is a provincial sales
tax exemption on small-scale renewable energy equipment which will save us $671. We elected to pay the pst and obtain a rebate
later as this increased the refund amount for those incentives that were percentage based.
There are, of course,
important details around these incentives of which you must be aware, and there are complimentary programs to provide assistance to
homeowners of various income levels. A good place to begin gathering information is the website of the provincial government’s
Office of Energy Efficiency at (www.gov.pe.ca/oee).
Even at the present relatively low price of heating oil, our system
should pay for itself in no more than six or seven years and provide a tax-free return on investment in excess of 15 percent. If the price of oil goes up, so will our return on investment.
I should mention one reason
why the system made so much sense in our case. We had been relying on an oil-fired boiler to provide our domestic hot water. During the summer, these boilers can be as little as 25 percent efficient and this opens the gateway for considerable savings if you
can find another way to heat your domestic water.
From an environmental perspective, the system should directly displace at
least 600 litres of heating oil and over 1,500 kilograms of carbon dioxide emissions annually.
So, go solar!
Rod
Dempsey of Charlottetown is a Board member of the Environmental Coalition of Prince Edward Island