Pewaukee-based builder and developer Matt Neumann added solar installation to his business in 2009. He calls the timing perfect.
“Because in 2008 the federal investment tax credit was extended until the cap was lifted so you could receive a 30 percent tax credit for any system you install, whether is was $1,000 or $ 1 million,” he says.
The investment tax credit was due to expire this year, but it’s been extended five more years. “The 30 percent tax credit is good through 2019, 2020 it goes down to 26 percent, 2021 is goes down to 22 percent and then going forward it stays fixed at 10 percent,” Neumann says.
Neumann says solar costs have dropped approximately 70 percent since he jumped into the business. “And most of that drop took place between 2011 and now. With that cost reduction comes market competitiveness. A lot of the rebates and incentives that were there before, they’re now gone, but that’s okay because our industry is maturing, there’s a lot more capital in our industry than there was in the past,” he says.
Although he is one of the region’s strongest solar advocates, Neumann admits a very small percentage of his building projects incorporate solar power.
“It’s a shocking low number. It’s probably five percent or less of the construction we do. And part of that is because it is not as beneficial for homeowners as it is for businesses to do it,” Neumann says.
Businesses receives accelerated depreciation in addition to the federal tax credit.
Neumann says a straightforward policy that’s practiced in other states would bring more residential solar installations on-line in Wisconsin.
It’s called third party ownership. “It’s really simple. Businesses like ours pay for the home installation and then charge the homeowner less than they would pay for electricity than you would from We Energies or any other utility provider in the state. And it transfers the risk to a business rather than an individual, ” Neumann says.
He believes momentum is growing to bring third party ownership to life in Wisconsin. “We believe (it) is legal today, what we need is a legislator to clarify that for us,” Neumann says.
Neumann believes the energy tide is beginning to shift in Wisconsin. He points to a recent court decision.
In 2014, We Energies proposed an extra fee for customers who produce their own solar energy. In October 2015, a Dane County Circuit Court judge ruled against the move, citing the state Public Service Commission did not have enough evidence to approve the fee.
Neumann calls the ruling a turning point. “But I think the biggest turning point will be when we get our Republican assembly, senate and governor to sign legislation that says they support solar financing in all arenas the way that it’s done in the rest of the country,” he says.
He asserts solar policy should not be a partisan issue. “I’m a conservative Republican, I don’t think that’s a shock to most people,” Neumann says. He is the son of former US Congressman Mark Neumann.
“I think Republicans are warming up to the idea of having choice, having a free market where you have a choice of what type of energy you want to buy. The national defense issues that come along with having a decentralized energy grid is very important,” Neuman says.
He says Wisconsinites pay some of the highest energy rates in the country. “I think maybe only second to Michigan. So it’s about time we look at alternatives because what we have been doing is not competitive,” Neumann says.
Renewable Energy advocates are meeting in Madison today to brainstorm their vision of the utility of the future.