Category Archives for "Florida"

Buying Solar Panels in Miami, Florida

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Miami Solar

For those of you living in Miami, you'll find a lot of good news and some bad news about the state of solar Florida.

As a solar customer there, you’ll find that you will come out way ahead in areas such as property taxes, sales taxes, net metering, and tax credits. Unfortunately, you will be left behind in state-specific tax credits and energy policies.

If you are interested in purchasing a solar system in Miami, then I advise you to read through all of the various options included in this article to find which one works best for you.You will find that solar is a compelling investment no matter where you live, but specifics to the state of Florida will be important to any decision that you make.​

#1 Overall Solar Grade: Miami, Fl

C Overall State Grade
12 years Avg. Payback Time
3.54 % Estimate IRR (Return on your investment on cash purchase over 25 years)
$17,844.22 Your Net Profit Over 25 Years (Cash Purchase)

* Note that these are estimated values for informational purposes only, and do not take into account the full complexity of all financial projections. They also only apply to cash purchases, which means your numbers will be different if you lease your system or pay for it with a loan (factoring in interest). 

#2 Options for buying solar panels in Miami

As with the rest of Florida, the best return for investment in solar comes from a cash purchase.

For the purposes of this article, we’ll use an average install price of $16,600 before any incentives or discounts for a 5kW system. This system size is a great balance between savings and costs for an average home. Below we will talk about the three main ways to purchase a solar system for your house: cash, leasing, and loans.

We’ll look at the upfront costs and expected returns on your investment over a 25-year period. How long does it take to pay off the system? When will you start making money? What is your average return? Which is the best route to take? Read on!

Let me explain a little bit. Consider solar power to be an investment. Investments usually offer some kind of return.

Following me so far?

If you think of the savings that solar provides as the “return” on your investment, then you can look at the value of the system over its 25 year life. 

Cash upfront

If you are able to come up with the cash to buy your solar system outright, it would make sense that this would be the best approach to getting a new solar system for your home. This, however, is not the case.

With cash, you will be plunking down the $16,600 out of your own pocket during that first year. This is a big upfront payment. Now, after you file your taxes for that year you will also get that 30% federal tax credit for $4980 and you will have also saved about $843.54 on your energy bills for a combined total of $6447.54.

Here’s where it gets interesting. Your system will produce roughly the same amount of power each and every year that it is operating, but the cost to produce that energy will stay the same (nothing). Your power company, on the other hand, will typically increase their prices each year. While the national average has increased by less than 3% per year on average since 2008, but some areas see much higher increases.

In Florida, for instance, FPL (Florida Power and Light) recently asked for a 24% increase over 3 years. Increases like this can definitely impact your monthly bills.

With the cash method, your system will typically pay for itself after the 12th year and you’ll see a $17,844.22 income from the system for its remaining 13 years in service. Again, if you look at solar as an investment you’ll be doing a lot better than any kind of savings accounts or bonds.

Leases

Unfortunately, Florida has currently outlawed any leasing agreements between solar producers and potential customers in the state. This is unfortunate, because while it may not always be the best financial method to get access to solar power it is definitely the easiest method to create widespread adoption because of the zero-down nature of leasing.

More: Solar Leases

Loan

Although it may seem a little counter-intuitive, loans may actually the best overall method to pay for your new solar system (in terms of return on investment). The reason is simple: you are using someone else’s money to save money. Financing isn’t usually associated with saving money in the long run, but due to utilities’ yearly price increases, the math will work out in our favor.

Let’s take that same $16,600 system from the cash example. We’ll also assume that you are taking out a home equity line of credit (HELOC) to provide the financing for the solar system, but this scenario works for any loan that has a 5% or less interest rate.

The interesting thing about taking out a loan for solar is that you, as the loan purchaser, actually still get access to the 30% federal tax credit. So, you’ll be taking out a loan for the $16,600, but when you file your first year’s taxes you’ll be getting $4,980 back in your pocket (you’ve already made money!).

Of course, it’s not a perfect scenario. Due to your loan payment, you’ll end up paying about $60 per month for solar in the first year. This is your total loan payments (about $1,575) minus your energy savings (about $843). The good news is that because your utility bills tend to increase each year, you’ll be paying less and less for your solar system as the years go by. Also, after you’ve paid off your system in 15 years, you’ll start to see savings of up to $1100 per year from your system until the end of its 25-year life.

This scenario will give you about $10,815 in profits over the life of your system and you never took a dime out of your pocket to pay for the system up front!

More: Solar Loans

There are tons of credit unions, banks, and loan companies that can provide a loan for you in Florida.  You also have the option to take out a HELOC to finance your solar panels.  If you are shopping for a solar loan, just be sure that you are getting fair terms and keep in mind that all of my scenarios below assume that you are getting at least a 5% interest rate or better.

#3 Solar Policy Information

Miami’s solar energy policies are complicated because Florida, as a whole, seems to be a bit confused in terms of its solar energy policy. On the one hand, they are extremely enthusiastic with certain areas while completely shutting out solar in the other. It can be shown that Miami does have some interest in bringing solar power to various parts of the city, but there are still no real incentives for average customers.

The landscape of solar policy also stays rather turbulent because of the state’s four major energy companies actively trying to circumvent solar progress. Let’s take a look at how the main areas of Florida’s energy policy stack up.

Renewable Portfolio Standard

Florida, and therefore Miami, does not currently have a Renewable Portfolio Standard (RPS). An RPS is essentially a decision by the government to mandate that a certain percentage of the power generated within the state comes from renewable sources.
Florida’s lack of RPS means that it is up to smaller companies and individuals to lead the charge for bringing solar energy to the forefront in the state. It’s still very possible to effect this change, but there is no officially mandated support yet.

Electricity Prices

On average, Floridians pay about 11 cents for a kilowatt-hour which is two cents cheaper than the national average. This means that for those interested in solar, you won’t be offsetting as high of a cost as you might in other states. One of the major highlights of solar, however, is that no matter how low your costs for power are you will eventually recoup your investment and start generating a profit from solar power.

The reason behind this is that your initial cost won’t increase, but utility companies tend to increase prices slightly on a year-to-year basis.

Net Metering

If you are not familiar with net metering, then you really should learn about how it can help you make money with solar power. See, net metering is a system that requires your utility company to monitor how much power you are actually consuming from the grid while also making sure that you get a credit for any surplus energy that you are feeding into it. This means that your power-conscious lifestyle can help your solar panels generate even more savings and even income in the long run.

Florida actually has a very generous set of standards for net metering that they set back in 2008. Basically, it will be easy to hook up to their grid because there is no maximum for the amount of people that can tie in. The energy surplus you generate will roll forward for up to 12 months at which point the utility will pay you for any leftover excess!
Making money by saving money is a win-win in my book!

More: Net Metering

Interconnection Rules

Florida’s interconnection policies are a bit of a mixed bag. In case you didn’t know, interconnection policies state how customers are allowed to “plug in” to the power grid and send power to the utility companies from their home system. The good news is that for small, single-home systems there shouldn’t be any issues at all with connecting to the grid.

Florida has a few requirements for larger systems such as external disconnect switches and mandatory insurance. For systems under 10kw, which would be almost everyone reading this interested in a single-home system, there are no such requirements!

#4 Financial Incentives, Rebates, and Other Tax Credits 

In yet another example of the mixed bag that Florida offers for its solar energy customers, there are huge pros and huge cons in the list of incentives that you can expect from the government. But remember that incentives are just that – incentives to encourage people that wouldn’t normally be interested in solar to try it. There are compelling financial reasons for going solar even without generous rebates or credits!

Solar Rebates

Unfortunately, there are no statewide rebate programs in Florida and nothing specific to Miami. The one program that was available in Florida, the Florida renewable energy tax incentive program, is no longer available. These types of programs offer rebates to help offset the costs incurred with setting up a new solar system.

Miami, FL Tax Credits

As mentioned before, Florida offers no official tax credits and Miami has shown no effort to create it’s own. There are no local rebates in this area.

Utility-based Performance Payments

First of all, what is a performance payment and why is it important for you? Most places will, in some shape or form, pay their citizens to generate solar power. They do this because the state mandates that they do so through some type of incentive program or RPS. This allows companies and individuals to help offset some of the costs associated with installing a new solar setup.
Unfortunately, the Miami area does not offer any such performance payments. The OUC in Orlando does offer some payments for solar, but this is the extent of these programs in Florida.

Property Tax Exemption

Finally, an area that the Sunshine State begins to shine in! The state of Florida allows a 100% exemption for any value added to your home from installing solar for the purposes of assessing property taxes. This is a huge deal because your home’s value can increase up to $20 for every one dollar of electricity that you save each year from solar.

Basically, the value increases because the cost of maintaining the home actually decreases. It also means that any value captured from adding the solar panels could actually be assessed when selling your home. This is a win-win from a financial perspective in Miami!

Sales Tax Exemption

This is another category in which Florida gets a stellar rating. If you purchase a solar system in Miami, you will not have to pay any sales tax on your purchase because the state offers a 100% exemption. This is equal to an automatic 7% tax savings on your solar system in Miami-Dade County. If your system cost $18,000, you’ll be saving $1260 right off the bat!

What to do next?

If you are in the market to buy a new solar system in Miami, FL then you will definitely find lots of businesses willing to provide you service.  Although the state is not the most pro-solar in the US, it has not stopped producers and third-party installers from stepping up to the plate and offering packaged systems with set pricing.

For residents of Miami, you have tons of opportunities to save money by investing in solar technology. The state ranks 3rd in the nation for rooftop solar potential so you are almost guaranteed to have a great experience with your panels.

You’ll also be eligible for federal tax credits, state tax savings, and a strong net metering proposition.

If you are on the fence about going solar, my recommendation is to jump in and check out your options. You’re bound to find something that works for you!

Buying Solar Panels in Tampa, FL

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Going Solar in Tampa, Florida

If you are living and looking into solar panels in Tampa, FL then you are no doubt aware that your state is called the "Sunshine State" with good reason. In fact, you are usually able to enjoy up to 244 days of sunshine each year!

With all those golden rays coming in, it's no surprise that you are interested in installing a solar panel system on your roof to invest in the free energy available to you. Solar systems represent a great investment for your home, community, and nature itself and this opportunity is ready for you in Tampa!

Unfortunately, there are a few obstacles that you will have to deal with while living in Florida and due to the mixed bag of policies in the state, we currently rank it a solid 'C' compared to other states in the US. You will come out way ahead in some areas, but some financial opportunities will be closed to you as well. Let's find out what we're dealing with.

#1 Overall Solar Grade: Tampa, Fl

C Overall State Grade
12 years Avg. Payback Time
3.54 % Estimate IRR (Return on your investment on cash purchase over 25 years)
$17,844.22 Your Net Profit Over 25 Years (Cash Purchase)

* Note that these are estimated values for informational purposes only, and do not take into account the full complexity of all financial projections. They also only apply to cash purchases, which means your numbers will be different if you lease your system or pay for it with a loan (factoring in interest). 

#2 Options for buying solar panels in Tampa

There are a few options for buying or otherwise getting access to solar panels in Tampa and we will look at the pros and cons for each method.

Although it is impossible to tell you exactly how much your system will cost to purchase and install, we can look at sources like the Solar Electric Power Association and the National Renewable Energy Laboratory to get an average cost of $16,600 for a typical home-sized 5-kilowatt system. This size is a good balance between the savings you’ll generate and the costs you will have to cover in order to install it, assuming that you are getting good productivity! We will use this cost to show upfront costs and expected returns on your investment into solar energy.

Remember, this cost is also before any financial incentives such as rebates or tax savings (such as the Federal Tax Credit that knocks off 30%). So, how long would it take to pay off your system? When will you start making some free money by selling energy back to your utility? Which payment method should you choose?

These are all great questions, but to answer those questions let’s look at why solar panel systems are considered an investment. The lifespan of a typical solar panel system is about 25-40 years and it will be producing free energy for your home over this time period.

We’ll take the conservative estimate and say that buying a solar system is like making an upfront investment in the next 25 years of your home’s energy. The “return” on this investment is all of the money that you are saving by not paying the utility company for energy production. Your returns will also improve from any extra energy that you are able to produce and sell back to the utility (more on that later!).

Cash upfront

Cash is king and there is always an argument to buying something outright with cold, hard money.

Paying cash avoids any type of interest payments, for instance, and it will possibly allow you a little more flexibility with your installer depending on the situation. Financially, however, it might not always make the most sense to pull out $14,560 from your pocket upfront when there are other options available.

Let’s check out how it would work.

Using cash, you will be pulling out $16,600 up front for your system during your first year. This is obviously a big down payment. When you file your taxes for the year you purchase your system, however, you will be able to take advantage of the 30% federal tax credit for $4,980 and you will have also saved about $843.54 during that first year in reduced energy costs for a combined total savings of $5,823.54!

We’ll talk more below about how we can determine the energy savings you will see with your system. The beauty of solar is that your system will produce about this much energy each and every year over its lifetime, but the cost of generating that energy stays the same (nothing except for maintenance).

The energy that you would normally be using from your utility company, however, ordinarily increases each year. As a normal customer of your utility company, you might not be paying a whole lot of attention to the details of your energy bill, but your costs each year can rise substantially and you will have no choice but to pay the utility company what they are asking.

You see, utility companies are often granted monopoly rights by the state and that means that there is very little flexibility when it comes to changing companies unless you are willing to move to another part of the state. Although Duke Energy does not currently service the Tampa area, they recently raised their rates by 48% over a 10 year period. Wow.

Looking back at the cash method, your system will usually pay itself off in around 12 years and you will see $17,844.22 (total savings on electricity – total system cost) in income from your system over its lifetime!

Leases

Leasing is an option that has surged in popularity across the US as companies have recognized that there is a huge market for making solar affordable to those that wouldn’t ordinarily have the means to pay cash or finance a loan for their system.

Unfortunately, the state of Florida does not currently allow leasing. Don’t worry though because leasing may be the cheapest option up front, but there are less long-term benefits to this method.

More: Solar Leases

Loan

Due to the simple fact that you are using someone else’s money to invest in your solar panel system, taking out a loan can represent the best option for a lot of people looking to take the leap into solar.

Obviously, financing is not usually the tool of choice when someone is looking to make money in the long run, but due to the nature of rising utility costs, the math can actually work in your favor.

Let’s use the $16,600 from the cash example. Let’s also assume that you are using a 15-year home equity line of credit (HELOC) or any other loan source that has a 5% or less interest rate.

Remember that even though you are taking out a loan to finance your system, you still have access to the 30% tax credit because you are the one doing the financing. So you will actually be taking the loan out for $16,600, but you will be getting back $4,980 when you file your taxes for the first year. See, you’ve already made money!

The rub to this method comes down to the loan payment. Due to this payment, you will actually end up spending about $61 per month for solar in your first year. We can find that number by taking your total loan payments (about $1,575) and subtracting your energy savings (about $843.54).

Btw, you can use just about any loan calculator to come up with these numbers for yourself.

Because your utility bills typically increase each year, however, you’ll end up paying less and less for your system as the years go by. Your loan payments and the percentage of energy covered by your system stays the same each year while the amount of energy you are saving is worth more and more. After your loan is paid off in 15 years you will actually start to see savings north of $1,000 per year from your system until the end of its 25-year lifespan.

In this scenario, you’ll be generating about $10,815.22 in net savings from your system over its lifetime, but you never paid any of your own money up front!

More: Solar Loans

#3 Solar Policy Information

Here we discuss some of the larger policy issues related to solar in Tampa, Fl.

Renewable Portfolio Standard

The Renewable Portfolio Standard (RPS) is basically the overall energy policy that determines how much energy is required (if any) to be produced by renewable sources such as wind, biomass and solar. If the state is interested in developing renewable energy, this policy gives them an opportunity to force the state utility companies to start developing energy production.

Unfortunately for those of you living in Tampa, Florida does not currently have any type of renewable portfolio standard. Not having an RPS means that there is no incentive for the major utility monopolies to lift a finger to help grow renewable energy sources in the state and it is up to smaller companies and individuals to help lead the movement for solar energy in Florida. There is no reason to give up hope without an RPS, but it is certainly encouraging to see official support from your government.

Electricity Prices

On average, Floridians pay about 11 cents per kilowatt-hour on their electricity bills which is actually two cents cheaper than the national average. Energy costs are important because these costs factor into how much your solar panel system will save you. If you are paying less than the national average, then you will be saving slightly less than someone else that has the same system as you do.

Don’t get discouraged by this fact, however, because no matter how low your costs are from your utility company are now you will eventually recoup your solar investment and start generating profit from it.

Don’t forget that utility companies tend to raise their rates by at least 3-4% per year and the electricity produced by your solar panels won’t cost you any more in the future. The math works out in your favor!

Net Metering

For anyone interested in powering their home with solar energy, net metering is something that you need to learn about immediately! Basically, net metering is a system that requires your utility company to monitor exactly how much power you are consuming from them while also checking to see how much power you are feeding back into the grid. You see, solar systems work by producing abundant energy during the daytime, but less at night.

What this means is that you might actually be producing more electricity than you need during the day while you use energy from your utility grid during the night. The other part of net metering, the best part, is that the utility companies must actually pay you a set rate for any energy surplus that your system provides to the grid!

Florida’s state net metering laws, set back in 2008, make it very easy to hook up to the grid to start gaining from these benefits because there is no maximum amount of people that can tie in. They will also roll your energy surplus forward for up to 12 months, at which point they will pay you for any excess. This is a win-win for those of you that have frugal energy lifestyles and want to help serve your community and the planet by providing clean, renewable energy!

More: Net Metering

Interconnection Rules

In Florida, the interconnection rules are a bit of a jumble between good and bad for any would-be solar installer.

Interconnection policies define exactly how customers are allowed to “plug in” to their local power grid and deliver power to the utility company from their home system. The good news for you is that the rules are actually quite simple for smaller, single-home systems. The rules state that larger systems have features such as external disconnect switches and they also make insurance mandatory on those systems.

For systems under 10kw, which should be pretty much anyone reading this article, there are no such requirements. Your single-home system will be very straight forward!

#4 Financial Incentives, Rebates, and other Tax Credits 

Some cities and states have really gotten behind solar in a big way, but unfortunately Florida is a bit of bad and good at the same time. In some ways, it seems like the state government really wants to open up the doors for solar and invite new customers to start paving the way to cleaner energy. In other ways, it looks like it is purposefully trying to close the doors. Just remember that local incentives are just icing on the cake for anyone interested in solar because you will be coming out way ahead once your system is paid off and you are able to reap the rewards of your investment.

Rebates

The only official statewide rebate program that has ever existed in Florida was the Florida renewable energy tax incentive program which has unfortunately been discontinued. Under this program, the state would reimburse individuals and companies for certain expenses related to renewable energy and even refund previously paid taxes for eligible equipment. The state government did not anticipate the demand for solar that its citizens would have and subsequently ran out of funding for the program. Who would have ever thought that the sunshine state wouldn’t be enthusiastic about solar?

Other Incentives

Unfortunately, there are no other incentives available to residents in Tampa, FL. One bright note, however, is that the local utility (Tampa Electric) does seem to make it easy to get your system connected and fully supports net metering. They also offer citizens without a solar system the ability to purchase “blocks” of renewable energy produced by the utility as a way to help the environment.

 

Federal Tax Credit

The big score for anyone interested in solar since 2005 has been the residential renewable tax credit. This credit allows for a 30% tax credit for any costs related to purchasing and installing a new solar panel system. This basically means that you can take 30% of the cost right off the top of going solar. Remember that you can qualify for this credit when you pay for the system with cash or a loan, but leasing the system means that your installer gets the credit.

Property Tax Exemption

Moving on to local property taxes, residents of Tampa will be pleased to learn that the state of Florida currently allows for a 100% exemption for any solar equipment that adds value to your home when assessing your tax bill. This is quite a financial windfall for you because the value of your home can actually increase up to $20 for every dollar of electricity that you are saving each year with your solar panel system.

The reason your home will increase in value with solar is that the cost of maintaining your home actually decreases when you go solar. Don’t worry about losing the value added to your home when the time comes to sell it though because you’ll be able to roll the value into the asking price.

Sales Tax Exemption

Continuing with the awesome tax trend in Tampa, sales tax is another area in which you will see a great incentive to go solar. If you purchase a system for your home, you won’t have to pay a cent of sales tax because the state offers a 100% exemption on the sale! This is basically equal to a 7% reduction in the cost of your system in Hillsborough county. If your system cost $14560, you are saving $1019 at the time of purchase.

General Increase in Home Value

As we touched on before, a solar panel system can definitely add value to your home. A recent study suggests that people were willing to spend up to a $4 per watt premium for homes with a standard-sized system. If you look at the math, it means that a 5-kilowatt system could add as much as $20,000 to your home. Considering that you won’t be paying any additional property taxes on this extra value in Tampa, it definitely looks like a win-win!

Conclusion

If you are currently trying to decide whether or not to purchase a solar panel system in Tampa, FL then my recommendation is that you strongly consider all of the wonderful benefits that are available to you in your state. Although there might not be the most direct incentives available to you, the tax credits, state tax savings and a strong net metering opportunity are all great ways to save money.

Don’t forget that you are in the Sunshine State and you are living in the third highest state in the country in solar potential! Also, we recommend that you contact a local qualified installer to get an actual solar estimate for your exact situation!

The best way to get started is by getting a solar estimate from a qualified solar installer in Tampa. Click the link below to get started!

Disney Solar Plant Looks Like Mickey Mouse

disney solar installation

Disney World’s Large Solar Project Probably Looks Familiar

For those on their way to Orlando’s Disney World to get Belle’s autograph or revel in the Magic Kingdom, the first taste you might get of the famous park is while you still on the plane, staring down at the biggest, bluest Mickey Mouse you’ll ever see. You’d probably be surprised to know that it’s actually a solar installation!

This might come as a surprise, but Walt Disney World has come out as a major adopter of renewable energy. They just completed a large-scale solar installation to power the park and while Disney isn’t the first theme park to go solar, and soon it won’t be the largest, it has a certain panache that no one other than Disney could pull off.

In late 2015, Disney World leased 20 acres of land to Duke Energy, a large utility company operating in several states in the southeastern United States, for construction of a 5 megawatt (MW) photovoltaic solar power plant – the largest solar project in the park thus far. As always, Disney never does anything without going all the way and the 48,000 solar panels are installed in the all-too-familiar shape of a giant, renewable Mickey Mouse head.Continue reading

Will Florida Ever Get Its Solar Energy Act Together?

We’ve talked about the problems plaguing Florida’s solar power before. Even with the building of a solar farm next to Walt Disney World, the Sunshine State has had trouble exploiting its abundant sunshine. According to the New York Times, they rank third in the nation for rooftop solar potential, but 13th in the actual amount of solar energy generated.

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Does Solar Energy in Orlando Mean Solar for Walt Disney World?

What could make the Happiest Place on Earth even happier? Why, taking advantage of all that sunshine in the Sunshine State!

Recently, Duke Energy Florida said in a press release they have received approval to build, own and operate a 5-megawatt solar facility that will serve the Reedy Creek Improvement District near OrlandoContinue reading

Florida Solar Group Looking to Make Solar Accessible

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We talked previously about how Florida is cutting back its solar targets. But a group of solar advocates are trying to make the Sunshine State live up to its name. ThinkProgress reports that a pro-solar conservative group in Florida reached enough signatures on a petition to make solar more accessible to consumers.

Florida for Solar Choice’s Petition

Currently, if a Floridian wants to purchase solar power directly from other consumer, they can’t. But Floridians for Solar Choice reached 72,000 petition signatures, which clears the way for the petition to be reviewed by the Florida’s Supreme Court. They’ll decide whether or not the petition’s language qualifies to be a ballot initiative for Floridians in the 2016 election.

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Significant Solar Job Growth in Conservative States

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The solar industry is booming, with over 173,000 solar jobs in the U.S. And more states than ever are leading the way, with unexpected states like Georgia trumping solar production over more solar traditional states. However, the most surprising news may be that solar is taking off in politically conservative states that a decade ago may have never been seen as energy efficient leaders.Continue reading

Florida Cutting Back on Solar Power Targets

Oh, the irony. The “Sunshine State” is doing away with its solar rebate program at the end of next year.

We just spoke with solar installation companies in Florida, and the rebates are still in effect for 2015 – so it’s a great year to go solar. What’s particularly sad is that Florida is ranked as the 3rd best state to go solar in, and many of the local companies have been around for decades – proving that Florida really is the Sunshine State!Continue reading