Utah Rebates and Incentives Summary

utahUtah is home to true wonders of nature: Arches National Park, Moab, Canyonlands, and the Great Salt Lake. Given the harsh desert climate, it’s hard for most things other than rock to retain color, as the pounding desert sun bleaches everything. But that sun also makes Utah an ideal state for solar energy development. And because of the climate, it is among the sunniest states in the country’s solar belt.

Parts of the state get upwards of 6.5 or more kilowatt hours of sunlight per square meter, and most of the state gets an average of 6.0 kWh of sunlight per square meter. The only states that get more overall sun are Arizona and Nevada. Despite this rich resource, the state still has a long way to go in terms of adopting solar and renewable energy.

For instance, the Open PV project, a database of installed solar projects throughout the United States, reports only one PV installation in the state. While that’s not indicative of the Utah market, it is telling. To help people in the state adopt more PV, Utah offers net metering, solar tax incentives, and the state and some Utah utilities offer rebates to residents that install photovoltaics (PVs) and other renewables on their homes and businesses.

The state adopted a voluntary renewable portfolio goal, under which utilities need to pursue renewable energy, only if it is cost-effective. The goal, while similar to a renewable portfolio standard, does not ultimately establish renewable generation requirements for utilities. It was established under The Energy Resource and Carbon Emission Reduction Initiative, which passed in March 2008.

Under the goal, utilities must assess the cost-effectiveness of adding “qualifying electricity” that will generate electricity at the lowest reasonable costs. Qualifying generation includes renewables like wind and solar, and also nuclear energy, as well as some fossil fuel generation with carbon sequestration technologies. Under the goal, 20 percent of a utility’s electric generation must come from qualifying sources by 2025.

The majority of Utah’s current electricity generation comes from coal-fired power plants, according to the DOE’s Energy Information Administration. Two geothermal power plants, as well as natural gas-fired and hydroelectric generation provide the rest of the state’s electricity needs.

Utah Net Metering

Program Type Net Metering
Technologies Photovoltaics, Solar Thermal, and other renewables 
Amount Up to 25 kW for residential systems                                                                                      
Required Documentation Interconnection agreement with customer-generator’s utility
Official Web Site http://geology.utah.gov/
Under Utah’s net-metering law, all electric generating investor-owned utilities and cooperative utilities must offer their customers net-metering for renewable energy systems. Municipal utilities are not required to offer net metering under the law. Investor-owned utilities, like Rocky Mountain Power—currently the only such utility—must net meter up to 20 percent of its 2007 peak demand, while cooperatives must net meter up to 0.1 percent of their 2007 peak demand.

Rocky Mountain Power credits customers at retail rate. Electric cooperatives reimburse customers at their avoided cost rate for generating additional electric.

Net excess generation produced by customers is credited forward on a monthly basis for up to 12 months. At that time any overall net excess generation is credited back to the utility without additional compensation to the customer. Credits revert back to the utility on March 31 of each year.

Under the net-metering law, residential customers may net meter systems up to 25 kW in size, and commercial customers may net meter systems up to 2 megawatts in size. Customer-generated electricity may be from solar, wind, small hydropower, co-generation, or fuel cell systems of up to 25 kW in size for residential systems and 2 megawatts for commercial systems.

Some cities or municipalities have also established net-metering rules for their customers; check the program site for details about net metering in individual cities.

Under the state’s interconnection requirements, a disconnect switch is not required for systems under 10 kW and may be required for a net-metered system up to 2 megawatts, depending on how the system is set up.

Utah State Renewable Energy Systems Tax Credit

Program Type Tax Credit
Technologies Photovoltaics, Solar Hot Water Heating, Solar Thermal Electric, Passive Solar Heat, Solar Pool Heater, and Other Renewables
Amount Up to $2,000 or 25 percent, whichever is less
Required Documentation Application to the Utah Geological Survey’s Utah State Energy Program and State Tax Form TC-40E.
Official Web Site http://geology.utah.gov/

The state’s renewable energy tax credit is available to both residents and businesses—including installers and homebuilders. For residents the credit is limited to $2,000 or 25 percent of costs of installation and system components. For companies, it’s limited to $50,000.

Construction companies can take a tax credit for installing a system on a residential unit as well. If a non-business entity leases a system, they also are eligible for the credit but may not claim the credit for more than seven years from when the entity leased the system.

Applying for the credit takes two steps. System owners must first apply with the Utah State Energy Program and then receive tax form TC-40E from the Utah Tax Commission. Then, they must complete and submit the tax form with their annual tax filing. The filer may claim the credit for up to four years after http://www.cleanenergyauthority.com/solar-installers/.

The state also requires all system costs to be documented “as completely as possible.” The program said such costs may be documented through invoices, catalog listings, receipts, designs, and more. When a project includes costs that aren’t eligible to qualify for the tax credit, costs for those systems need to be distinguished from eligible costs.

Utah Renewable Energy Rebate Program

Program Type Rebate
Technologies Photovoltaics, Solar Hot Water Heating, and Wind Energy

Up to 25 percent of total system cost, or $8,750, for residential PV, $5,000 for wind, and $2,500

for solar hot water

Required Documentation Rebate Reservation Application, Rebate Reservation Confirmation Letter, and Rebate Application Form
Official Web Site https://geology.utah.gov/utah-renewable-energy-rebate/

This first-come-first-serve renewable energy rebate program began in 2010 and was funded by $3 million from the American Recovery and Reinvestment Act. The rebate provides rebates to home and business owners as well as schools, local governments, and nonprofits. It is not clear whether Utah will extend financing for the program after the funds are exhausted. At this point (Sept. 2010), the program is continuing to accept applications for residential PV and residential solar thermal (electric, hot water and heating) systems. However, residential wind turbines can no longer qualify for the rebate, and businesses and nonprofits can only qualify for rebates for solar thermal systems and wind turbines.

The Utah State Energy Program requires interested parties, prior to purchasing the system, to solicit a bid on the proposed project from a properly licensed contractor. Then, using that information, they must submit a Rebate Reservation Application package. The program recommends using technical information from the contractor for the information. Upon granting approval, the program will send the applicant a rebate-reservation letter allowing construction on the project to move forward. Upon completion, applicants must submit the rebate application form. Applicants have nine months to submit the form.

Homeowners can qualify for a maximum rebate of up to 25 percent of the solar installation and system costs or $8,750, whichever is less. The $8,750 is offered at a rate of $2 per installed DC watt of PV power. The system must be at least 900 watts in size and no more than 25 kWs in size. Solar thermal systems are reimbursed at a rate of $30 per square foot, up to $2,500. There are no limits to the size of a solar thermal system.

Homeowners installing wind turbines previously qualified for a rebate of up to $5,000 at a rate of $1.50 per watt, whether or not the program will reopen to residents installing wind remains to be seen.

Other renewable energy rebates are available through utilities. To learn more about those programs, residents should contact their utility or visit the Database of State Incentives for Renewable and Energy Efficiency.

Utah Solar Power Financial Incentives

Financial Incentives

Corporate Tax Credit

Personal Tax Credit

Sales Tax Exemption

State Loan Program

Utility Rebate Program

Rules, Regulations & Policies

Building Energy Code

Contractor Licensing

Energy Standards for Public Buildings

Green Power Purchasing/Aggregation


Net Metering

Renewables Portfolio Standard

Solar Access Law/Guideline

Related Programs & Initiatives

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Weatherization Assistance Program

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