Renewable energy tax credits are constantly at risk of coming to an end and there is a battle now to extend these incentives past the end of the year. Another incentive used in Europe are FITs (feed-in-tariffs) and this article gives a good argument to support the implementation of FITs in the US.

6) In 2007, 1 gigawatt of PV was installed in Germany, which yields a rate of installation 3 times that of California if rated according to GDP. If we rate CSI’s expense per actual installation and take into account the time value of money, the cost to ratepayers per megawatt installed are at least the same order of magnitude as a FIT. In 2007 – 7 years after the introduction of the German Renewable Energy Law – just 3% of electric costs to consumers are attributable to the FITs. Estimates are that the law’s contribution to German electric rates will peak in 2015 but will remain a small fraction of overall electricity costs.

7) Utilities can get behind a successful FIT because they can count all feed-in participants as part of an RPS target, which they cannot under net metering. Additionally, FITs protect utilities from imbalances between rates paid and funds collected, as the cost of the tariff is directly reflected in retail bills.

Production tax credits are significantly reduced under net metering because the credit is based upon production which despite kilowatts produced can appear to be zero if all power is used before the meter.