Direct state and local government cash incentives for solar installations have declined in recent years as federal tax credits have been on the rise.
Government incentives for residential rooftop solar are $2.90 a watt compared with $4 for commercial
The impact has been a shift favoring the commercial market over residential rooftop installations, a Lawrence Berkeley National Laboratory study found.
At the same time, at least through 2008, the cost of installing solar rose as the drop in incentives offset falling prices for solar panels and installation.
The study, released this week, found that commercial projects putting solar on plant rooftops or in nearby farms benefited from generous state and local cash incentives as well as federal and state tax credits. These incentives added up to $4 a watt in 2008, near a record high reached in 2006.
Tax incentives for resident systems were at a record low, however, of $2.90 a watt in 2008. This was their lowest level in 11 years.
Despite the differences, the costs of installing solar rose in 2008. For residential systems, installation costs averaged $5.40 a watt, up 1 percent from 2007. Costs for commercial systems rose 5 percent to $4.20 a watt.
The study did not address 2009 costs, a year in which panel prices tumbled.
