If you are a Connecticut business owner or a member of a Connecticut business, you should know about the Connecticut ZREC incentive program. ZREC stands for Zero-Emission Renewable Energy Credits. A renewable energy source earns one REC every time it produces one kilowatt-hour (kWh) of energy. It’s a solar incentive program that gives you a monetary incentive to go solar. Some aspects of the ZREC program include the following.
In the ZREC solar incentive program, Connecticut Light and Power (CL&P) and United Illuminating (UI) offer 15-year contractual revenue to commercial solar system owners. With this revenue, the utility companies pay a fixed price for every kWh of energy the system owners produce. This program works to encourage Connecticut businesses to switch to using clean, renewable energy sources for their facilities.
While the monetary incentives are great, applying for ZREC is a lottery process. If your business does not win the lottery, you will not have access to the monetary incentives. It’s also the only direct monetary incentive program in Connecticut at the moment. However, other tax credits, incentive programs, and federal and state grants can help you finance your switch to solar energy.
If your business and its solar project are selected for the ZREC program, your ZREC project will have to meet state requirements for its size. ZREC projects can be small, medium, or large. A large ZREC is a project less than or equal to 1,000 kW and greater than or equal to 250 kilowatts (kW); it has an annual budget of about $2.7 million; and it has a REC price cap of $350 per REC. A medium ZREC is between 100 and 250 kW, but its annual budget and REC price cap are the same as those of a large ZREC. A small ZREC is less than 100 kW and it has the same annual budget as large and medium ZRECs, but its REC price cap is the weighted average of a medium ZREC price + 10% and up to $350 per REC.
If you don’t win the ZREC lottery, don’t worry. You can still apply for the following federal and state incentives for renewables:
- C-PACE Financing: This state-run financing program offers zero-down financing that can provide the capital your solar project needs to get going.
- SBEA Grants and Financing: Energize CT offers grants and low-interest financing for small businesses that want to switch to clean energy.
- USDA Grant: U.S. Department of Agriculture runs the Rural Energy for America Program (REAP), which offers grants to small businesses and agricultural businesses in rural areas. If your business is in a rural area of Connecticut, this may be the grant to finance your solar project.
- Federal Solar Tax Credit: The U.S. government offers a 30% tax credit on commercial solar installations. Even if you don’t get a ZREC, you will still have access to this tax credit.
When you partner with Verogy to develop a solar project, we will seek out financial options that help you make your energy-efficient vision a reality. If you have any questions about how we can help you finance your project, contact us today.