Man Asks Valid Question: “Why Am I Taxed on the Solar Energy That I Generate Myself?”

Every family tries to save money on electrical bills and if you have a house the solar system will alleviate that cost at least that is what Kris Currie thought to be true.

This Canadian resident designed an energy-creating home in order to save money on his energy bills by evading the tax, but unfortunately his plan did not go through.

He wanted to get off the grid by building such home, but was not successful although he produced his own energy. His house is in New Dominion, P.E.I. (Prince Edward Island); Canada was designed in every aspect to create energy.

Man Asks Valid Question: “Why Am I Taxed on the Solar Energy That I Generate Myself?”

Currie believed that he has succeeded in producing energy for which he should not pay a cent, but that did not happen when he received a bill for tax on every kilowatt produced per hour. This came as a shock to him since he already spent $46,000 on building his own solar paneled house, including $6,000 HST on materials like extra insulation and solar panels.

He did everything that was in his power to avoid this kind of tax, but the HST (harmonized sales tax) was still billed to his household. Yes, he was not billed by the Maritime Electric for the energy bills, but was still billed for the HST on every kilowatt-hour used as any customer would.

He built in his home 35 solar panels which were meant to generate all the needed electricity for a whole year round. Only the heating oil is excluded from HST on P.E.I., but other energy sources for heating such as wood or electricity are not.

This homeowner belongs to the P.E.I.’s net metering program meaning that individual homeowners can generate their own electricity and sending the excess into the grid in exchange for credits. The net allows them to draw electricity back out of the grid when the solar power cannot be generated at night without paying for it.

Naturally, Kris was not happy with this billing system and considers it nonsense because he uses his produced energy only for heating. Moreover, he has built his net-zero home without government assistance, and paid HST on the solar panels and the labor to have them installed. He said: “Oil’s exempt. Now that we’re producing electricity we’re getting charged for it.”

According to the reports of CBC his home is now generating more electricity than it uses, and the P.E.I.’s electricity grid receives the excess that is being later on sold to other Maritime Electric customers, who pay HST on what they use.

Aside the fact that he wanted to save on his monthly bills, this system is eco and it will lower his family’s carbon footprint. Nonetheless, it will cost him a lot since he invested a lot in its solar system, and time has to pass so that it becomes sustainable.

He stated:

It all goes into cost at the end of the day, how many years payback will you get? …The quicker we can get a payback, the quicker this stuff’s going to get produced.”

He believes that this added tax is made on purpose by the government preventing the people to get off the grid. This for sure will discourage other homeowners from doing the same as everybody is on a cost basis when building a house and that includes energy consumption as well.

Kris fought for this charged sales tax to be removed for people who produce their own solar electricity and bank it with a local utility through a net metering program, and thanks to his ongoing campaign he did receive some financial relief from the P.E.I. government. The Canadian province removed the provincial portion of the HST from part of all residential electric bills. In a way this was a victory for Kris as this move has cut the tax on his electric bill for about a half.

According to reports of CBC the province had asked the Canada Revenue Agency for a ruling on the taxation of energy produced under its net metering program. It has been supported by the federal finance minister told P.E.I. Senator Percy Downe, who took the issue up and asked for a review of the situation with the P.E.I. government.

Nonetheless, the ruling confirmed that electricity is a taxable supply and Maritime Electric is required to charge HST on the full value of that supply, even if the customer is being credited for the electricity itself.

Todd Dupuis, P.E.I.’s executive director of climate change and environment, said that the province would introduce new incentives for solar energy in 2019.

Kris story went viral and many Canadians got interested in creating their own net-zero homes, but the only problem could be still the HST tax.