The Cut Inflation Act is recognized as the most significant clean energy legislation in US history. But what can the average American expect to gain from the incentives of the new law? In this ongoing series, we’ll provide real-world scenarios of potential savings for solar power, energy storage, electric vehicles and more. Today we start with the story of Uri.
Uri works as an electrician in Chatham, New Jersey. Although he considers himself a car enthusiast, Uri has never really been convinced that an electric vehicle has the power and acceleration he wants. At least, that was until he was driving a friend’s electric vehicle and the acceleration really caught his eye. Uri has been looking for a new car for a few months but just couldn’t find the right car. He is now wondering if he should consider an electric vehicle.
As with all major decisions in life, Uri has other factors to consider in his car buying decision. For example, he has two children who are approaching college age, so Uri and his wife focus on saving. Even though their household income brings in about $210,000 a year, he always assumed electric vehicles were too expensive. But with the new incentives reserved for owners of electric vehicles in the Inflation Reduction Acthe thinks he can get up to $7,500 off the price of an electric vehicle.
This leads him to wonder…should the family put it all together by installing solar power on their roof and an EV charger in the garage? He likes the idea of charge your car with clean energy. He has heard that solar energy can also help him reduce his utility bills. And, his utility, recently said they want increase sound electric tariffs. Right now, he’s already spending about $180 a month.
But how much would all this cost? Even with all the incentives, Uri isn’t sure he can really afford all of this.
The Cut Inflation Act offers owners of electric vehicles financial benefits including up to $7,500 off the purchase of an EV and a 30% tax credit on the installation of EV charging systems at home.*
Uri has done some research and knows that to get the full $7,500 electric vehicle tax credit, the car he chooses must be manufactured in North America with an MSRP under $55,000 for a sedan or $80,000 for a truck or SUV. Uri has his eye on a Chevrolet Silverado RST carry all his electrician tools. He was thrilled to find that even if he adds a few bells and whistles to his purchase, he will still be able to stay well below that maximum.
Most owners find it much more convenient to power an electric vehicle at home than public charge. In reality, 80% of electric vehicle owners choose to charge at home. Charging an electric vehicle can take hours, especially for high-capacity vehicles like trucks. Uri could save a lot of time if he installed a level 2 charging system in his garage.
Uri has also looked at home charging units a bit and decides he likes the convenience of getting the property rated Wall box EV charger installed in conjunction with a SunPower solar system. Both products seem really make sense together since EV chargers typically increase a home’s electrical load.
With a roof system like a SunPower EquinoxUri would be able to run his Chevy Silverado RST in direct sunlight rather than relying on rising prices and harmful pollutants caused by traditional fossil fuels. Using solar power and an EV charger, Uri and her family could offset much of their electricity and all of their gas bills while providing some resilience to the increased frequency of major tropical storms in southern Jersey. This idea gives Uri a level of peace of mind he hadn’t anticipated. He also likes the flexibility of renting his solar system.
Now let’s do the math. How much would the system cost versus how much Uri can expect to save on energy costs and tax incentives?
10.88kW SunPower Equinox
Wall box: $1,600
Chevy Silverado RST: $52,974
Projected electricity offset by solar: $1,884 and after monthly lease payments of $132, an annual savings of $300. Without the ITC, lease payments would be approximately $189/month.
Projected annual fuel savings: $1,500
Estimated tax credits
Electric vehicle: $7,500
Wall box: $1,120
Once he’s done the math, Uri decides it makes perfect sense to Begin on a solar design while he completes his VE setup. Also, he learns that if he goes ahead with the SunPower lease, they will pass on the savings from the Inflation Reduction Act to him. If he will not receive the credit directly, the 30% solar tax credit will allow him to benefit from lower payments.
For more concrete examples of how to leverage the IRA for your own home energy needs, keep an eye out for new blog posts over the coming weeks.
10 Clean Energy Benefits in the Cut Inflation Act That Could Change Your Home and Fill Your Wallet
How many solar panels do you need to charge your electric car?
Why should you get a custom SunPower quote?
* Tax credits subject to change. SunPower does not guarantee, guarantee or advise its partners or customers on specific tax results. Consult your tax advisor regarding the solar tax credit and how it applies to your particular situation. Please visit the dsireusa.org website for detailed solar policy information.