R362-2-6. Investment Tax Credit, Eligible Costs for Commercial and Residential Systems, Active Solar Thermal

  (A) All eligible costs for active solar thermal energy systems must conform with Section R362-2-5, above. Active solar thermal energy systems must also meet the requirements in this Section.

  (B) For purposes of determining eligible costs, an active solar thermal system ends at the interface between it and the conventional heating system. Eligible costs for a solar thermal system are limited to components that would not normally be associated with a conventional heating system. Eligible equipment costs include:

  1. Solar collectors that transfer solar heat to water, a heat transfer fluid, or air;

  2. Thermal storage devices such as tanks or heat sinks;

  3. Ductwork, piping, fans, pumps and controls that move heat directly from solar collectors to storage or to the interface between the active solar thermal system and a building's conventional heating and cooling systems.

  (C) Hot water storage tanks that have dual heat exchange capabilities allowing for the heating of water by both the active solar thermal system and by a nonrenewable energy source such as natural gas or electricity are eligible for tax credits. However only one half of the costs of purchasing and installing such tanks are eligible costs for the purposes of calculating a commercial or residential tax credit.

  (D) In order to be eligible for residential or commercial tax credits, a solar collector that heats water must be certified and rated by the Solar Rating Certification Corporation (SRCC) according to SRCC Standard 100, "Test Methods and Minimum Standards for Certifying Solar Collectors."

  (E) In order to be eligible for residential or commercial tax credits, an active solar thermal system installed after December 31, 2008 and that heats water must be certified and rated by the Solar Rating Certification Corporation (SRCC) according to SRCC Document OG-300, "Operating Guidelines and Minimum Standards for Certifying Solar Water Heating Systems." The applicant can demonstrate to OED that the solar thermal system meets standards that are equivalent to those of the SRCC Document OG-300 by providing:

  1. Detailed engineering design and performance data that show system performance, or

  2. Certification from other recognized National or European solar thermal testing labs.

  (F) In order to be eligible for a residential or commercial tax credit, the taxpayer applicant must demonstrate that a solar thermal energy system has been sited and installed appropriately in order to realize the maximum feasible energy efficiency for a given location. Specifically, the system should conform with the following:

  1. Solar collectors shall be free of shade (vent pipes, trees, chimneys, etc.) and positioned accordingly so as to optimize the average annual solar ration values (kWh/M²/day). Guidance for siting may be found at the National Renewable Energy Laboratory's (NREL) National Solar Radiation Database, which can be found at:

  http://rredc.nrel.gov/solar/pubs/redbook/PDFs/UT.PDF;

  2. Fixed, non-glazed collectors shall be:

  a. Oriented within 45 degrees of true south if the fixed pitch is greater than 30 degrees from horizontal, or

  b. Oriented within 90 degrees of true south if the fixed pitch is 30 degrees or less from horizontal.

  3. Fixed, glazed collectors shall be oriented within:

  a. 115 degree azimuth and 245 degree azimuth if the fixed pitch is greater than 35 degrees from horizontal, or

  b. 90 degree azimuth and 270 degrees if the fixed pitch is 35 degrees or less from horizontal.

  (G) In order to be eligible for a residential or commercial tax credit, all solar hot water thermal systems shall be installed by one of the following licensed contractors:

  1. A Utah licensed plumbing contractor (S210 license);

  2. A Utah licensed solar hot water contractor (S215 license); or

  3. A licensed contractor who has obtained written approval by the Utah Department of Occupational Licensing for the installation of solar hot water systems.

  (H) In order to be eligible for a residential or commercial tax credit, an active solar thermal system must be certified for safety by one of the following:

  1. A Utah licensed plumbing contractor (S210 license);

  2. A Utah licensed solar hot water contractor (S215 license); or

  3. A county or municipal building inspector licensed by the State of Utah.

  Proof of this certification may be required on the tax credit application.

  (I) For purposes of computing eligible costs for residential and commercial tax credits, the reasonable cost of a flat panel active solar thermal system is considered to be no higher than $0.15 per Btu/day of heat output for all eligible costs listed above and in Section R362-2-5 and prior to any cash rebates or incentives that the taxpayer may receive from a third party (such as a utility). The determination of heat output shall be based upon the ratings of the Solar Rating Certification Corporation (SRCC) "Summary of SRCC Certified Solar Collectors and Water Heating System Ratings" that is found at:

  http://www.solar-rating.org/ratings/ratings.htm.

  1. For a residential tax credit application with total pre-rebate eligible costs exceeding $0.15 per Btu/day of capacity, the amount of the tax credit shall be calculated as follows:

  Tax credit granted = (($0.15 x rated output capacity in Btu/day) - rebates) x 0.25

  2. For a commercial tax credit application with total eligible costs exceeding $0.15 per Btu/day, the amount of the tax credit shall be calculated as 10% of costs calculated as follows:

  Tax credit granted = (($0.15 x rated output capacity in Btu/day) - rebates) x 0.10

  3. If the cost of a flat panel active solar thermal system exceeds $0.15 per Btu/day of capacity due to unusual and/or unavoidable circumstances (such as a multi-story structure retrofit or difficult pipe chase and interconnection conditions) the taxpayer applicant may request that the reasonable cost limitation above be waived by OED. In order to do so, the applicant must provide written documentation and explanation from the designer or installer of the system as to why the final system cost exceeded this limit. Granting of such a waiver will be at the discretion of OED after investigation as to the validity of the waiver claim.

  (J) For purposes of computing eligible costs for residential and commercial tax credits, the reasonable cost of an evacuated tube active solar thermal system is considered to be no higher than $0.27 per Btu/day of heat output for all eligible costs listed above and in Section R362-2-5 and prior to any cash rebates or incentives that the taxpayer may receive from a third party (such as a utility). The determination of heat output shall be based upon the ratings of the Solar Rating Certification Corporation (SRCC) "Summary of SRCC Certified Solar Collectors and Water Heating System Ratings" that is found at:

  http://www.solar-rating.org/ratings/ratings.htm.

  1. For a residential tax credit application with total pre-rebate eligible costs exceeding $0.27 per Btu/day of capacity, the amount of the tax credit shall be calculated as follows:

  Tax credit granted = (($0.27 x rated output capacity in Btu/day) - rebates) x 0.25

  2. For a commercial tax credit application with total eligible costs exceeding $0.27 per Btu/day, the amount of the tax credit shall be calculated as 10% of costs calculated as follows:

  Tax credit granted = (($0.27 x rated output capacity in Btu/day) - rebates) x 0.10

  3. If the cost of a flat panel solar thermal system exceeds $0.27 per Btu/day of capacity due to unusual and/or unavoidable circumstances (such as multi-story structure retrofit or difficult pipe chase and interconnection conditions) the taxpayer applicant may request that the reasonable cost limitation above be waived by OED. In order to do so, the applicant must provide written documentation and explanation from the designer or installer of the system as to why the final system cost exceeded this limit. Granting of such a waiver will be at the discretion of OED after investigation as to the validity of the waiver claim.