Residential Solar Incentives
Incentives for Using Solar Energy in Your Home
Several residential solar incentives, rebates, and tax credits can make switching to solar power even more affordable. Thanks to the work of the federal government, state lawmakers, and partnerships between local utility companies, homeowners can save thousands on the cost of their installation with these residential solar incentives.
At Earthlight Technologies, we work with you to find and apply for state and federal solar rebate programs. If you have any questions or want to check your eligibility for a specific program, call us at 866-499-3084.
Popular Homeowner Solar Panel Incentives and Tax Credits
Federal Solar Investment Tax Credit (ITC)
Homeowners can receive a federal tax credit for 30% of the total system investment for systems installed through 2019. The ITC then steps down to 26% for systems installed in 2020 and 22% for systems installed in 2021. After 2021, the residential credit drops to zero and the commercial credit drops to 10%. This credit is used in the same calendar year the solar system is installed and goes live. A solar tax credit is a dollar-for-dollar reduction in the income taxes that a person would otherwise pay the federal government. The credit can be enjoyed throughout the US, including CT, MA, and OR.
Net metering is a way for utility companies to track how much excess energy you send back to the grid. This can significantly reduce or even eliminate your electrical utility bill. Net metering rules can vary state by state, and is permissible in CT and MA.
In CT, net metering will compensate homeowners for excess electricity sent back to the grid at a rate of one kilowatt-hour for one kilowatt-hour produced through December 31, 2039 for homeowners who go solar before the state’s residential solar investment program expires. By law, the program must expire on December 31, 2022, or when the program deploys 300 megawatts of residential solar photovoltaic installations, whichever occurs earlier.
Property Tax Exemption for Solar Energy
While adding solar panels can increase the value of your home, some states have laws that exempt a new installation from increasing your property tax. For residents in OR, MA, or CT, you don’t have to worry about rising property tax bill due to your solar installation.
Sales Tax Exemption for Solar Energy
In MA and CT, the state sales tax is waived on solar installations. That means you can save 6.25 percent in Massachusetts or 6.35 percent in CT off the total cost of panels, inverters, and materials for your home’s solar system. And since Oregon doesn’t have a state sales tax, you are already saving.
- CT Green Bank (Residential Solar Incentive Program)
- Connecticut’s generous rebate program, made possible by The Connecticut Green Bank, can help reduce the cost of adding solar to your home by thousands of dollars. The Green Bank offers two types of incentives: The Expected Performance-Based Buydown (“EPBB”) and the Performance-Based Incentive (“PBI”). Residential solar incentives are available until 300 MW is reached. Current rates based on generating capacity: $463 per kW (up to 10kW) and $400 per kW (10-20kW), with a max rebate of $8,630.
- The newest incentive for Massachusetts solar projects is the SMART program, which provides a consistent incentive structure over the fluctuating rates that plagued the SREC incentive.
- Massachusetts state tax credit for solar energy
- MA has a 15% state tax credit for residential solar installations. However, the credit comes off the net cost of your system (minus the federal tax credit), and it has a $1,000 limit.
- Energy Trust of Oregon Incentive
- The Energy Trust of Oregon offers a cash incentive for Pacific Power and Portland General Electric customers. This incentive is paid to the installer and is immediately taken off the total project cost.
- Oregon state tax credit for solar energy
- OR currently offers a state tax credit of up to $6,000 to be taken over 4 years.