Focus, Banking & Finance, and Sustainability

Solar energy investment tax credit still available

HighPoint Electric just installed a $30,000 system at its headquarters.

October 31, 2014
| By Pete Daly |
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Leslie Cardinal, president of HighPoint Electric, says that even on cloudy days the solar panels on the company’s roof will still collect energy. Photo by Jim Gebben

With two years left to take advantage of a 30 percent investment tax credit for businesses installing a solar energy system, business owners in West Michigan are being urged by one growing electrical contracting company to consider sun power.

But HighPoint Electric doesn’t just talk solar energy — it has installed its own 10 kilowatt electric generating system on the roof of its headquarters in Belmont.

So what does HighPoint Electric say to the skeptics who think Michigan doesn’t have enough sunny days to make solar energy viable?

“There is a misconception that you have to have sunlight all the time to generate power, and you don’t,” replied Leslie Cardinal, president of HighPoint Electric and owner with her husband, Jerry Cardinal.

“It could be cloudy and you’re still going to produce energy,” she added.

Kevin Ricco would agree. He is the new director of the Michigan Alternative and Renewable Energy Center in Muskegon, a research center owned and operated by Grand Valley State University.

“We do hear that quite a bit,” said Ricco, regarding the solar naysayers, and he concedes West Michigan is a region with lots of gray and cloudy days. However, he adds, “The technology has improved, and even on gray and overcast days we’re actually still drawing quite a bit of energy through the solar panels.”

When he says “we” he means MAREC, which has a 30 kilowatt solar collecting system on its roof that is continuously monitored — and it’s 10 years old.

“Just about any place on the planet can benefit from having a solar array” of collecting panels. “It doesn’t have to be desert Southwest with 363 days of sun a year to get a bang for the buck from it,” said Ricco. “I think, as an industry, that’s something we need to get the word about out a little bit more.”

Ricco added that as the technology continues to improve, “we’re getting more and more (energy) out of less.”

He said he would guess that if MAREC installed a new state-of-the-art solar array, “we could probably come close to doubling that production” from the same size panels.

Small and mid-size businesses can use the 30 percent Business Energy Investment Tax Credit (often referred to as ITC) up to Dec. 31, 2016, according to Jim Manning, a partner at accounting firm Plante Moran’s Grand Rapids office. The tax credit can offset the installation of a solar array, solar panels or other type of solar energy installation, but to qualify, the company needs to own the property in question and be a tax-paying entity.

According to Manning, who leads the firm’s renewable energy practice, the credit can be used against the company’s federal income tax, which can include the alternative minimum tax.

Manning noted that the ability to market one’s business as “greener” and more environmentally friendly is also a benefit, particularly in that it helps attract and retain millennials and other young employees.

The ITC was extended by President Obama in 2009 and is set to expire at the end of 2016. Small businesses and property owners file for the credit on Tax Form 3468, but Manning said there are a number of “nuances and potential limitations” to the ITC, “so it’s always a good idea to talk through the process of applying for a tax credit with your accountant.”

Cardinal said the system on the roof at HighPoint Electrical cost approximately $30,000 and since HighPoint installed it — using its own licensed solar power technician — there was a savings in the installation cost. She said the installed cost for a similar system is generally estimated at $3.50 per watt, which indicates an installation cost of $5,000 for a 10 kW system.

The system is made by SolarWorld USA, an Oregon-based company that bills itself as “one of the world’s largest solar-technology producers and the largest U.S. solar panel manufacturer for more than 35 years.” It has factories in the U.S. and Germany.

The HighPoint array consists of 36 photovoltaic panels, each rated at 280 watts and measuring 38 inches by 66 inches. Cardinal said the system requires an area of about 35 by 20 feet. It can be installed on the ground or on a shingle roof with a pitch from 2/12 up to 12/12. Most solar panels in Michigan are installed on a 30-degree tilt or more so that snow that accumulates will melt and fall off within a few hours.

The HighPoint installation is calculated to generate about 12,000 kilowatt hours of power per year. The company will not use that power itself; rather, it is sold to Consumers Energy on the grid for almost 20 cents per kilowatt hour. Cardinal said Consumers estimates it will generate about $2,400 worth of electricity per year.

Actual output data on HighPoint’s system is not yet available as it will not be fully operational until later in the fall. Once that happens, Cardinal said it will be able to put a link on the company’s website ( that shows the real-time output of the system.

Cardinal said the solar panels have a warranty of 15 or 20 years and are maintenance free. “You don’t have to inspect them. They’re just there,” she said.

“I think this is something more and more people are looking at,” she said.

Cardinal said HighPoint has sold five systems since it began selling solar installations a couple of years ago, with more sales expected in the near future. Some were installed on the ground and others on roofs. The arrays range from 3 kW (3,000 watts) to 40 kW for the smaller ones, but large ones, such as those used by a utility company or very large manufacturing site, can start at 10 megawatts.

Customers so far have included Sandy Bottom Berries in Rockford (a 10 kW ground mount); Western Michigan University with a 235 kW roof mount; Tri-County Electrical Co-Op in Portland with a 20 kW ground mount; and a 13.8 kW roof mount on a residence in Cedar Springs.

HighPoint is a commercial/industrial electrical contractor founded in 2006 by the Cardinals from their home in Cedar Springs. The business began growing significantly in 2009 and has grown each year since, according to Leslie Cardinal. It moved to the vacant commercial facility in Belmont in 2010 and employs 55 people today.

The company is licensed in 11 states, but most of its work is in West Michigan. HighPoint did establish an office in Loveland, Colo., after taking on a project there.

“The market out there is just booming,” she said.

Business is getting busier here, too. One of HighPoint’s current projects is 616 Lofts at 820 Monroe Ave. NW in Grand Rapids, a $21.8 million mixed-use development in an old factory building. The upper floors will be market-rate apartments with the ground floor being used for retail and hospitality businesses.

Cardinal added that HighPoint is seeing a lot of growth in the manufacturing sector in West Michigan — a major customer for electrical contractors.

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