When it comes to solar energy, Colorado shines. Sunny days rule for more than a third of the year, and this abundant resource is harnessed through government-supported policies. In 2004, Colorado’s residents approved the nation’s first Renewable Portfolio Standards, and today the state’s RPS calls for 30 percent of the state’s electricity to be from renewable resources by 2020. Find information on electricity costs, solar panels, rebates, incentives, and energy programs in Colorado.
Colorado’s Solar
Report Card
To determine a grade for each state, our researchers and solar experts analyzed data on crucial solar-advancement criteria from the following sources:
- Rebates, Tax Credits, and Tax Exemptions from Database of State Incentives for Renewables & Efficiency;
- Electricity Rates from the U.S. Energy Information Administration;
- Renewable Energy Policy from NC Clean Energy Technology Center;
- Interconnection Ease from Freeing The Grid;
- Photovoltaic Potential from the Energy Department
We determined a rank from one to 10 for each state in each category. We then combined the scores with the following weights and assigned an overall grade for each state. Our goal is to encourage those considering solar for their homes to get a basic understanding of solar potential in their areas and discover the best opportunities for clean energy available.
Incentives & Rebates, 40%
Electricity Rate, 15%
Renewable Energy Policy, 30%
Interconnection Ease, 5%
Photovoltaic Potential, 10%
Electricity Costs in Colorodo
Colorado’s residential electricity costs are about $0.13/kWh, close to the national average. While higher electricity costs generally spur increased investment in solar, Colorado’s interest in solar is helped by the fact that solar installation costs in the state continue to drop, and solar customers enjoy certain tax exemptions, rebates, and net metering. Colorado is well on its way to reaching its 2020 RPS goal of 30 percent; in 2017, almost 25 percent of the state’s electricity came from renewable energy resources, including its 2,000 wind turbines.
Cost of Residential Electricity
Data from U.S. Energy Information Administration
*as of Q3 2015
Search Colorado’s
Resource Library
CO Solar Policies & Incentives
The key to Colorado’s solar success lies in its first-in-the-nation Renewable Energy Portfolio Standard. This requirement has prompted the state’s utility companies to offer rebates worth thousands of dollars. In addition, utilities are required to offer net metering or paying solar customers for the excess energy they contribute to the grid. Although Colorado does not offer a tax credit for solar installations, customers are entitled to certain property and sales tax exemptions. Several financial options also are available for solar panel installations, including leasing and third-party financing.
REBATES/INCENTIVES
A rebate is available to residential and small business customers who install a solar photovoltaic system or other renewable resource facility. Eligible systems are grid-tied within LPEA’s service area. For systems less than 10 kW, there is an upfront incentive of $16 per kW. Performance-based incentives are currently $1 per MWh and paid every six months for systems greater than 10 kW.
Holy Cross Energy Renewable Energy RebateThe WE CARE (With Efficiency, Conservation And Renewable Energy) Program offers rebates for renewable energy generation systems, including solar photovoltaics. The rebate is $750 per kW for the first 6 kW of a system, $500 per kW for the next 6 kW, and $200 per kW for the next 13 kW of a system.
San Miguel Power Association Renewable Energy Rebate ProgramBoth residential and commercial customers may be eligible for rebates for installing and owning solar photovoltaic systems. Rebates for residential systems are $0.25 per watt up to 3 kW or $750. Rebates for commercial systems are $0.25 per watt up to 10 kW or $2,500.
Colorado Springs Utilities Renewable Energy Rebate ProgramBusinesses and residential customers who install grid-connected solar photovoltaic systems are eligible for a rebate of $0.20 per watt. Up to 40 percent of the total system cost could be covered by rebates and tax credits, depending on the installation.
Xcel Energy Solar Rewards ProgramCustomers who install grid-connected PV systems up to 120 percent of their average yearly power load may be eligible for performance-based incentives between $0.005 and $0.0375 per kWh, depending on the system’s size, for 20 years of production, in exchange for renewable energy credits produced by their system.
Elevations Energy LoansLow-interest loans are available for a variety of renewable energy projects, including solar photovoltaics. Projects must be in Boulder County or the City and County of Denver. There is a $25 processing fee and applicants must become members of the Elevations Credit Union.
Mountain Parks Electric, Inc. Green PowerRenewable energy rebates are available for solar projects. MPEI members’ voluntary contributions fund the rebates. Residential maximum rebate is $1,000; commercial maximum rebate is $8,000.
City of Aspen – Residential and Commercial Energy Efficiency RebateThe city of Aspen’s electric system uses all renewable energy. They offer a rebate of 25 percent of the total project cost, up to $300 for energy-saving projects, including solar PV. Commercial projects can receive $0.75 per installed watt up to $2,250.
Loans are available in Eagle, Garfield, Gunnison, Lake, and Pitkin counties to help homeowners identify, finance and complete energy improvements, including solar photovoltaic systems. Loans from $500 to $50,000 are available with Interest rates starting at 2.75 percent.
Energy Savings Mortgage Incentive for Existing HomesIndividuals who buy an existing home and make energy-efficient or renewable energy upgrades within 120 days of purchase, or through a refinance on a first mortgage, may be eligible for the mortgage incentive. The benefit amount is based on a Home Energy Score determined by a qualified assessor.
Fort Collins Utilities Home Efficiency Loan ProgramResidential customers may be eligible for low-interest loans to finance up to the full cost of renewable energy projects, including solar photovoltaics, at existing homes. Loan repayment is bundled into customers’ monthly utility bills and can last up to 20 years.
Colorado’s statewide PACE program allows property owners to finance 100 percent of the upfront costs of renewable energy, energy efficiency, or water conservation improvements. Property owners repay the financing as a special assessment on their property tax bill over the financing term, up to 20 years.
POLICIES
Colorado requires each investor-owned utility to directly generate, or cause to be generated, 30 percent of its retail electricity sales from renewable resources by 2020. At least 3 percent must come from distributed energy resources, including small-scale solar photovoltaic installations.
Net meteringUtilities are required to provide net metering to customer-generators. Net excess generation is rolled over as a credit to the customer’s next bill. Any credits left over at the end of a year must be paid for at the utility’s average hourly incremental cost.
Solar Construction Permitting StandardsBuilding permits are required before solar PV systems can be installed in Colorado. Permits may be obtained from counties and municipalities. Fees are capped at no more than $500 for a residential application and $1,000 for nonresidential application.
Interconnection StandardsThe Colorado Public Utilities Commission oversees interconnection standards that apply to investor-owners utilities with 40,000 or more customers. There are three levels of interconnection for systems up to 10 MW.
City and County of Denver Solar Panel PermittingSame-day permit review is provided for most solar photovoltaic projects. Required permits for PV projects include electrical, plumbing and zoning. More complex projects might be required to go through a separate Plan Review process.
State law prohibits neighborhood covenants from restricting solar access, although some exceptions can be made for aesthetic requirements that do not significantly increase the cost of the installation or decrease its performance. Property owners may voluntarily agree to solar easements.
This mandatory residential green building program requires a builder or homeowner to include a minimum amount of sustainable building components based on the size of the proposed structure. Points are awarded for renewable energy and energy efficiency technologies.
TAX CREDITS
Owners of solar photovoltaic systems may receive a tax refund of 15 percent of the city sales and use tax paid on materials and permits for the solar installation.
None for residential specifically
None for residential specifically
EXEMPTIONS
All sales, storage, and use of components used in generating AC electricity from solar photovoltaics and other renewable energy sources are exempt from state sales and use taxes.
Personal property that is used to produce energy is exempt from state property taxes. The solar photovoltaic system of no more than 100 kW capacity must be located on the resident’s property and produce electricity primarily for the resident’s use.
None for commercial specifically
Colorado Companies, Contractors & Solar Panel Installers
About 5,000 people are employed in Colorado’s solar industry, working for nearly 400 companies that handle installation, manufacturing and distribution of solar panels and components, as well as in solar legal support and financing. Homeowners have a wide range of options in choosing a contractor to design and install a solar system, and Colorado homeowners have also seen average installation prices drop about 49 percent since 2010. Here is a list of some of the contractors available to install solar in Colorado:
Alpine Solar Design handles installation of solar water heaters and photovoltaic systems.
Where it operatesSilverthorne, CO
Year of opening1996
AES designs and installs solar systems ranging in power from 1 kW to hundreds of kilowatts, depending on available space. Employees are is certified by the North American Board of Certified Energy Practitioners (NABCEP).
Where it operatesDenver and Jefferson counties
Year of opening2008
Operating across central Colorado, ARE Solar builds solar systems ranging from 3 kW residential systems to large megawatt systems for commercial customers.
Where it operatesDenver and Boulder counties
Year of opening2008
The company sells products for both grid-tied and off-grid solar systems, including solar photovoltaic modules, batteries and backup generators, and also provides installation and repair services.
Where it operatesBoulder, Larimer, and Weld counties
Year of opening2000
The company offers solar photovoltaic systems and backup generators, as well as systems designed for off-grid usage.
Where it operatesNorth-central Colorado, including Denver
Year of opening2002
This family-owned business offers affordable solar solutions for both residential and commercial customers.
Where it operatesEl Paso County
Year of opening2008
IPS uses in-house engineers and certified installers in providing solar systems to individual homeowners and businesses.
Where it operatesNorth-central Colorado
Year of opening1996
The company specializes in designing solar systems especially suited for the elevation, weather and climatic conditions of Colorado’s high country.
Where it operatesNorth-central Colorado
Year of opening1991
This employee-owned, award-winning company offers business and residential customers customized solar installations.
Where it operatesAdams, Broomfield, Boulder, Denver, Jefferson and Larimer counties
Year of opening2005
The company installs both grid-tied and off-grid solar systems for remote locations, as well as providing backup solar power.
Where it operatesCentral Colorado
Year of opening2008
The company provides design, sales, and installation services for residential, commercial and industrial customers.
Where it operatesEl Paso County
Year of opening1975
Southard Solar offers a variety of solar services, including installation, removal, and upgrades, as well as systems designed for off-grid usage and a line of small, solar-powered homes.
Where it operatesFront Range and Boulder
Year of opening1987
Sunlight Solar provides free consultations, installation services, and various financing options for residential and commercial clients.
Where it operatesStatewide
Year of opening1985
In addition to residential and commercial customers, Sunsense provides solar systems to public-sector clients and utilities.
Where it operatesWestern Colorado
Year of opening1984
As part of its evaluation process, Suntalk works with customers to integrate other home technologies with their solar systems.
Where it operatesDenver County
Year of opening1996
After building their own homes powered by solar energy, SSI’s founders started the company to provide the service to others. Today, the company specializes in off-grid applications.
Where it operatesCentral Colorado
Year of opening1989
Resources
Find information about state energy programs and energy efficiency, and solar-specific information about community solar gardens.
Track pending solar legislation moving through Colorado’s state legislature; contact legislators; and stay current on renewables issues in Colorado.
The commission regulates electricity rates and services of the state’s public utilities.
Colorado Renewable Energy Society – Provides information about energy efficiency; offers renewable energy educational workshops and programs, and tracks legislative activities that impact renewable energy.
Explore the public database to find solar financial incentives, rebates and loan programs specific to Colorado.
Provides statistics about Colorado’s energy use, as well as the state’s potential for solar and other renewables.