An economic impact analysis of state solar incentives for improving financial performance of residential solar photovoltaic systems in the United States

Although the global new renewable energy (NRE) market has shown remarkable growth during the past decade, NRE policies and incentive schemes should continue to support NRE market and to achieve NRE targets from the long-term perspective. In particular, solar policies and incentive schemes still remain vital to the deployment of the residential solar photovoltaic (PV) system in the United States (U.S.) due to its high initial investment cost. The previous study conducted an economic and environmental assessment of the residential solar PV system considering state solar incentives in the U.S.; however, it did not suggest any improvement scenarios for state solar incentives. To solve this limitation, this study aimed to conduct an economic impact analysis of state solar incentives for improving financial performance of residential solar PV systems in the U.S. Towards this end, this study established 16 scenarios for improving state solar incentives and quantified cash incentive rates for each scenario which can satisfy the threshold performance levels in the U.S. As a result, this study could suggest more suitable tax incentives and cash incentive rates for achieving the economic feasibility of the residential solar PV system in each target city of the U.S.