Copy of TEP - Renewable Energy Credit Purchase Program

September 01, 2010

Summary

Note: Tucson Electric Power filed a request with the Arizona Corporation Commission to reduce incentive levels to prevent a premature exhaustion of program funds for photovoltaic installations. The Commission issued a ruling on August 25, 2010, authorizing a reduction in the incentive levels. This summary includes the new incentive levels as approved by the Commission. Tucson Electric Power (TEP) created the SunShare Program in 2001 to encourage residential and business customers to install new photovoltaic (PV) equipment. TEP transitioned away from their original incentive structure for PV and added incentives for a variety of other technologies in May 2008 under the new Renewable Energy Credit Purchase Program (RECPP). The technologies now eligible for funding through the RECPP all qualify under Arizona's renewable energy standard (RES). TEP offers these incentives in exchange for the renewable energy certificates they generate. Incentives for the 2010 program year are as follows:

• Residential PV (grid-tied): $2.00/W up front for qualified systems. Systems with less than a 20 year warranty on the module or a 10 year warranty on the inverter, or with a building-integrated PV (BIPV) system over 5kW must receive the 10, 15 or 20 year performance-based incentive (PBI) which is based on the actual metered electricity output.
• Residential PV (off-grid): $2.00/W
• Non-Residential PV (100 kW or less): $1.75/W for the first $2.0 million of funds awarded on or after July 7, 2010; $1.50/W for rebates awarded after the first $2.0 is exhausted for 2010. Systems greater than 100kW must take the PBI
• Solar Domestic Water Heating and Solar Space Heating: $0.25/kWh equivalent, plus $750 up to a maximum incentive of $1,750.
• Non-Residential Solar Water Heating and Solar Space Heating: $0.50/kWh-equivalent, plus $750
• Daylighting (Non-residential only):$0.18/kWh equivalent for 5 years.
• Wind (grid-tied, up to 1 MW):$2.25/W-AC
• Wind (off-grid, up to 1 MW): $1.80/W-AC
• On-grid small hydro, biomass-biogas systems, pool heating (non-residential only), space cooling, and geothermal (electric, cooling and heating systems) are all eligible to receive PBIs. See program website for full details including contract options, equipment requirements and PBI amounts.