Howard County’s Solar and Geothermal Tax Credit Doubling, Then Ending

The funding limit for the Howard County solar and geothermal tax credit program is doubling, but the program will end on April 1, 2012, according to a statement released by County Executive Ken Ulman.

The program supports homeowners in purchasing and installing renewable energy systems, such as solar and geothermal, for their houses.  As part of the newly increased limit, the county will “clear out its waiting list for the credits…having accomplished its goal of ‘jump starting’ the renewable energy industry in the region,” according to the statement.

The program was originally started while Ulman was on the County Council.  He and his colleagues at the time (now Delegate Guy Guzzone and Council President Calvin Ball) lobbied to create an incentive for residents to generate their own renewable energy. At the time, the market was such that many homeowners needed a small additional financial boost in order to make the investment financially feasible.

“The change and closure of the program came about because of the immense popularity of the program,” said Joshua Feldmark, Howard County's director of environmental sustainability.  “The cost of these installations has come down significantly and therefore residents have begun realizing the benefits of this type of investment -- with or without the tax credit. Since there is a $250,000 cap on the total amount that can be given away in credits in a given year, the wait list has grown immensely.”

The result, he said, is that the credit has become somewhat of a barrier, since people want to wait for the list to wane before they invest. 

“In our talks with the industry… it is clear that with other incentives, the renewable energy credit market, and the lower price of the product, investing in solar or geothermal is a wise investment even without the tax credit.  In other words, the credit did the job it was established to do and the need is no longer there” Feldmark said.

“I'm pleased that our current budget situation allows us to be able to raise the ceiling on the  tax credit for renewable energy and clear the backlog," Ulman said in the statement.

"I'm committed to helping Howard County residents do their part to help the environment. The program we started four years ago has exceeded our expectations.”

Even with the increase in the cap, it will still take a number of years to clear the waiting list.  In the interim, Feldmark said he expects to work and strategize with both environmentalists and the industry to determine what comes next in the evolution of renewable energy on a small scale such as individual homes or properties.  So far they have been talking about assisting with the creation of solar gardens, and even the possibility for support of electric vehicles. 

Those still eligible to receive the tax credit include residents currently on the waiting list, plus residents who have already applied for the tax credits, have a previously signed contract, or complete the solar or geothermal system installation and submit final paperwork for the credit by April 1, 2012.

In FY 2008, 11 residents applied for the energy tax credit.  By FY 2010, Howard County had reached the $250,000 annual cap midway through the year and had to start a waiting list for the following fiscal year. 

There are 263 residents on the waiting list.