For many Americans, tax season can be one of the most dreaded times of the year, but if you’re the proud owner of a residential solar system installed in 2019, your feelings toward taxes may be a little more cheerful this year. Homeowners who went solar in 2019 qualify for a 30% federal solar tax credit, which means thousands of dollars in savings. With that being said, the Federal Tax Credit is one of the largest savings opportunities for residential homeowners going solar.
Another solar savings gamechanger is net metering. Net metering allows solar panel owners to sell unused energy back to their utility’s companies, allowing them to build up credits which they can use to pay for their electricity during less sunny times of the year. For the most part, all solar buyers qualify for these incentives, but are there more ways you can save on solar???
Well, the answer depends a lot on where you live. Here at Blue Raven Solar, we know that deciding whether a solar system is right for your home usually involves a lot of number crunching and research. Finding each individual rebate or net metering policy for your specific state and city can cost you time and cause a lot of frustration (as many sources are outdated and inaccurate). That is why we have simplified your painstaking research by creating an easy to navigate solar savings post. This post will feature the latest savings updates on all 14 of the states in which we provide our services. Click on the list to jump to your state!
Net Metering – Colorado utilities companies have established effective net metering policies, allowing customers to save with any excess energy they produce. Xcel Energy offers the best net-metering program that allows you to use your excess production in two ways:
- Exchange your excess energy production for kilowatt-hour-based credits, which can be applied to future energy bills
- Receive a per-kWh cash payment
Through Colorado’s net metering policies, Colorado homeowners can get the most bang for their buck when installing solar. They can even make some money if they learn to make smart energy choices and cut their electricity usage.
Local Solar Rebates – Many Colorado utility companies offer solar rebates that can save homeowners some big bucks. Here are two current examples:
Tax Exemptions – In Colorado, any renewable energy equipment is sales, use, and property tax-free. Thus, you will not have to pay any additional fees to the government even though you are adding value to your home.
Energy savings mortgage incentive for existing homes – Any new home buyers who put solar on their roof are eligible for a state program that will help you pay for your mortgage for 120 days. By adding energy efficiency upgrades and a renewable energy system, you could qualify for $750-$3,000 in savings.
Because of so many local benefits, solar is a great option for homeowners in Illinois. In fact, Illinois has a renewable portfolio standard that means that the state is committed to producing 25% of its electricity by renewable resources by the year 2025. To accomplish this goal, the state is offering incentives to help its citizens put solar on their roofs.
Net Metering – In Illinois, your utility company is required under Illinois law to track your renewable energy production and give you credits for any excess energy that is produced. At the end of an annual period, these credits expire and revert to the utilities company without compensation. Thus, there is no need for a homeowner to purchase a system that produces much more energy than your household uses.
Solar Renewable Energy Credits – Because Illinois is committed to producing 25% of its electricity through renewable energy resources, it is offering a program called “Illinois Shines” that gives homeowners one solar renewable energy credit for every megawatt hour produced by your system. Homeowners can then sell these credits and generate income throughout the life of the entire system.
Property Tax Exemption – When residential solar buyers register their system with the chief county assessment officer, it will be re-valued as a conventional energy system (much cheaper) meaning property tax will be only slightly higher than before.
Net Metering – Net metering is applicable to all South Carolina residents. Every residential solar owner is entitled to credits for excess energy production. Those credits will be applied to the homeowner’s next utility bill and if there are excess credits at the end of the year, homeowners receive compensation.
State Tax Credits – South Carolina is one of the few states to offer state tax credits for going solar. The tax credit covers 25% of the cost of your solar system and can be carried over for up to ten years if you don’t pay enough in taxes in any one year.
Nevada is known for its clear, hot, and sunny days, which is why all Nevada residents are great candidates for owning a solar system. Nevada citizens love solar so much that they voted to have 50% of their energy be produced by renewable resources by 2032. With so much love for solar panels, let’s see what other local incentives make switching to solar easy in the Silver State.
Net Metering – Net metering policies have changed several times over the past 5 years, but currently all NV Energy customers are eligible to receive credits worth a percentage of retail electricity cost. As more solar panel owners join the program, the percentage will decrease. Currently, homeowners with NV Energy get 81% of the value of the electricity they sell back in credit form. They can then use these credits to pay off future energy bills during less productive months. Homeowners who are with Valley Electric Association get credited at the same rate you would pay the utility, making this net metering program more valuable than NV Energy’s program.
Solar Access Rights – All Nevada homeowners have the right to go solar, which means that no contract or legal document can prohibit a homeowner from owning solar panels and using them to generate power.
Solar Easement – Solar easement laws make it so that you can enter into an agreement with your neighbor, allowing you to have continued access to sunshine.
Net Metering – In Indiana, all solar panel owners are eligible for net metering. As your system produces excess electricity, it will be sold back to your utility for energy credits. Indiana residents can use these credits to pay for future bills in which their system does not cover all of the costs. Unfortunately, homeowners who go solar after 2022 will not be enrolled in these programs.
Property Tax Exemption –By adding a solar system to your home, the overall value of your property increases. Fortunately, in Indiana, solar owners do not have to pay property tax on the increased value from buying solar panels.
Sales Tax Exemption – With sales tax at 7% in Indiana, solar buyers can save big by not having to pay any sales tax on their system.
Solar Easement Laws – Solar easement laws make it so that you can enter into an agreement with your neighbor, allowing you to have continued access to sunshine.
Net Metering – Most Utahns use Rocky Mountain Power, who utilizes a net metering program that buys back any excess electricity for a slightly lower than retail rate in exchange for credits to use during less sunny months. Other utilities offer similar net metering rates.
State Tax Credit – Utah is one of the few states that offers a solar tax credit. Utah’s particular credit allows solar buyers to be eligible for a credit that is worth 25% of the purchase and installation costs of their system. The credit maxes out at $1,600. Unfortunately, this cap is decreasing by $400 dollars a year and will completely expire in 2022.
Solar Easement – Solar easement laws make it so that you can enter into an agreement with your neighbor, allowing you to have continued access to sunshine.
Net Metering – Net metering in Ohio makes solar a great investment for several reasons. Firstly, all utilities in Ohio must offer net metering to residential solar owners. Secondly, all net excess generation is carried over to the next month as energy credits. Lastly, if you have net excess generation (a surplus of credits) over the course of 12 months, Ohio is one of the only states that will send you a check in the mail to pay for those leftover credits.
Solar Renewable Energy Certificates – Because Ohio has committed to having 25% of its energy be produced by renewable energy sources by 2027, the state is offering energy certificates which are given out for each megawatt hour of electricity your panels produce.
Sales Tax Exemption – All Ohio residents are exempt from sales tax on their new solar system, meaning they won’t have to pay an extra 5.75% on their system.
Property Tax Exemption – Cleveland and Cincinnati are the only two cities in the state that let their citizens keep that added home value from solar panels off of their property tax.
Net Metering – Net metering in Florida allows its residents to carry over any excess energy generation as a credit (at full retail rate) to your next bill for up to 12 months. At the end of 12 months, the utility company will pay you for any remaining excess energy.
Local Rebates – In all of Florida, only the city of Longwood offers a local rebate. It is 10% of the cost of the system and maxes out at $500.
Tax Exemptions – All Floridians who put solar on their roof are exempt from sales tax as well as an increase in property tax from added home value.
Net Metering – The three largest electric utilities in North Carolina are required to provide full retail rate net metering to their customers. This means that homeowners with solar can sell back their excess electricity at full value to generate credits for future month’s utility bills. All unused credits get transferred to these utility companies without compensation at the beginning of each summer.
Solar Rebate – Duke Energy offers homeowners $0.60/watt for systems up to 10 kilowatts, meaning that solar customers can save up to $6,000. This rebate is one of the best in the nation and has influenced many homeowners to make the switch to solar.
Building Permit Rebate – Solar system owners in the city of Asheville are eligible for a rebate on the cost of the building permit when installing solar.
Property Tax Exemption – By putting solar on a roof, the value of a home increases immediately. Unfortunately, this means that homeowners will experience an increase in property tax. Luckily, North Carolina allows 80% of this increase in home value to be exempt from property tax.
Net Metering – Virginia is determined to benefit its solar owners through net metering. With statewide net metering laws, Virginia homeowners with solar can sell their excess electricity back to their utility company for monthly credits. These credits can be applied to your next month’s bill or roll over to future months. To make things even better, Virginians can sell the excess electricity back at the end of a 12-month period.
Property Tax Exemption – Because of legislation passed in 1977, residential solar panels in Virginia are exempt from property tax. This means that any extra value added to your home because of your solar array will not be added to your property tax. However, municipalities have the ability to control this legislation so each Virginian must see whether property tax applies to their new system beforehand.
Net Metering – All three utility companies in Idaho offer similar net metering policies. Net metering functions like this: any excess energy production will be applied as a credit to the next month’s bill. Avista esn’t offer a 12-month roll-over pay out.
State Tax Deduction – Residential homeowners are able to deduct 40% of the cost of your solar panel equipment and installation from your personal income taxes. For the next 3 years, Idahoans may apply 20% of the cost of their system to their income tax. This has a maximum deduction of $5,000 a year or $20,000 total.
Solar Easement Laws – Solar easement laws make it so that you can enter into an agreement with your neighbor that allows you to have continued access to sunshine.
Oregonians love their nature, so it’s no surprise that the state is a huge supporter of solar energy. In fact, they love solar so much that they want 50% of energy production to be through renewable energy resources by 2040. With that said, let’s see the local solar benefits Oregon is offering to their citizens.
Net Metering – Oregon is a great state to be a solar owner because all utilities must offer net metering. This means that all excess energy production will carry over to your next month’s bill. Unfortunately, Oregon’s net metering program does not roll over more than one month.
Solar Rebates – Starting in January of 2020, Oregon began a new solar rebates program that offers new residential solar buyers $0.20 per watt on their system. There is a catch on how much this rebate can save you as it has a maximum payout of $5,000 or 40% of the cost of your system.
Property Tax Exemption – All solar panels in Oregon are exempt from property tax. This means that the extra value added to your home from your solar system will not be added to your property tax.
Net Metering – Without a statewide law enforcing net metering, many homeowners miss out on programs that help save during less sunny months. Most of Texas’ larger utilities will buy excess production from solar panels at near retail rates.
Property Tax Exemption – All solar panels in Texas are exempt from property tax. This means that any extra value added to your home because of your solar array will not be added to your property tax.
Solar Rebates – Solar rebates in Texas are highly dependent upon where you live. Here are some solar rebates in Texas:
Net Metering – Originally, Washington’s Net Metering program allowed solar homeowners to receive compensation for left over energy credits after 12 months. Starting March 31st, any leftover credits will be given back to the utility company without any payment. With this new change, it is important for new residential solar buyers to install the right sized system on their home.
Solar Rebates – Snohomish County is the only area within Washington that offers a solar rebate. Residents of Snohomish County who go solar, are eligible to receive $300 per kilowatt installed with a maximum cash out of $2,000.
Sales Tax Exemption – Sales tax is relatively high in Washington at 9%. So, when Washington announced last year that there would be a 100% solar sales tax exemption, homeowners were once again excited by solar and ready to take advantage of a significant discount on all equipment, labor, and services related to their solar installation.
Is Solar Right for My State?
As you can see, each state offers a wide variety of benefits for all homeowners considering owning a solar system. As solar becomes more popular, these incentives will likely disappear. Thus, there is no better time to go solar than the year 2020. If you still have your doubts, don’t hesitate to get a free online estimate with Blue Raven Solar. It is our mission to help homeowners across the nation determine whether solar is a smart investment for your unique home and situation. By clicking on the link below, you will be able to fill out a form with your name, email, phone number, and zip code. Once submitted, one of our solar specialists will reach out to you for a free solar consultation and help you determine whether solar is right for you and your home.
In the coming years, Americans across the nation will become a part of the renewable energy movement. We’re excited to help you throughout your solar journey and hope to help you make a positive impact on the environment while saving you thousands on your electricity bill!