Comprehensive Guide to Solar Incentives Across U.S. States

As the push for renewable energy grows, many states offer attractive incentives for homeowners to adopt solar energy. This article provides a detailed overview of solar incentives available in various states, helping you make an informed decision about going solar.

Alabama Solar Incentives

Alabama offers limited solar incentives compared to many other states:

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on the total cost of a solar system installation
• Net Metering: Available through some utilities, allowing excess solar energy to be credited to future bills
• Property Tax Exemption: Solar systems are exempt from property tax assessments in some counties

Alaska Solar Incentives

Alaska has few state-specific solar incentives:

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available for systems up to 25 kW
• Renewable Energy Grant Program: Provides funding for renewable energy projects, including solar

Arizona Solar Incentives

Arizona offers several attractive solar incentives:

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Residential Arizona Solar Tax Credit: 25% of the cost of a solar system, up to $1,000
• Solar Equipment Sales Tax Exemption: No state sales tax on solar equipment purchases
• Energy Equipment Property Tax Exemption: Solar installations are exempt from property tax increases
• Net Billing: Utilities purchase excess solar energy at avoided cost rates

Arkansas Solar Incentives

Arkansas provides some solar incentives:

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available for systems up to 25 kW for residential and 300 kW for commercial
• Property Tax Exemption: Solar systems are exempt from property tax assessments
• Solar Access Rights: Protects homeowners' right to install and use solar energy systems

California Solar Incentives

California offers several attractive solar incentives:

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on the total cost of solar system installation
• Self-Generation Incentive Program (SGIP): Rebates for installing solar batteries, ranging from $150 to $1,000 per kilowatt-hour depending on eligibility
• Disadvantaged Communities - Single-family Affordable Solar Housing (DAC-SASH): $3 per watt incentive for low-income customers in disadvantaged communities
• Net Billing: Utilities purchase excess solar energy at avoided cost rates
• Property Tax Exclusion: Solar installations are exempt from property tax assessments until 2025
• Local Rebates: Some utilities offer additional rebates, such as Rancho Mirage Energy Authority's $500 rebate

Colorado Solar Incentives

Colorado provides several solar incentives:

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Property Tax Exemption: 100% exemption for residential solar energy equipment
• Sales Tax Exemption: Solar energy equipment is exempt from state sales tax
• Net Metering: Available for systems up to 120% of the customer's average annual consumption
• Xcel Energy Solar*Rewards Program: Offers per-kilowatt-hour incentives for solar production

Connecticut Solar Incentives

Connecticut offers the following solar incentives:

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Residential Solar Investment Program (RSIP): Provides upfront rebates or performance-based incentives
• Sales Tax Exemption: Solar energy equipment is exempt from state sales tax
• Property Tax Exemption: 100% exemption for residential solar energy systems
• Net Metering: Available for systems up to 2 MW

Delaware Solar Incentives

Delaware provides these solar incentives:

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Green Energy Program: Offers grants for solar installations, up to 40% of the cost or $10,000 for residential systems
• Net Metering: Available for systems up to 25 kW for residential customers
• Solar Renewable Energy Credits (SRECs): Homeowners can sell SRECs generated by their systems

Florida Solar Incentives

Florida offers the following solar incentives:

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Property Tax Exemption: 100% exemption for residential solar installations
• Sales Tax Exemption: Solar energy equipment is exempt from state sales tax
• Net Metering: Available through most utilities, allowing excess solar energy to be credited to future bills
• Solar and CHP Sales Tax Refund: Refund on sales taxes paid for solar energy systems

Georgia Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available through some utilities
• Solar Easements: Allows property owners to create solar easements for solar access

Hawaii Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Renewable Energy Technologies Income Tax Credit (RETITC): 35% of solar system cost, up to $5,000
• Green Energy Money $aver (GEM$) On-Bill Program: Low-interest financing for solar installations
• Net Billing: Allows selling excess energy back to the grid at varying rates

Idaho Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available through some utilities
• Property Tax Exemption: 100% for solar energy systems

Illinois Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Solar Renewable Energy Credits (SRECs): Allows homeowners to sell credits generated by their systems
• Property Tax Break: Special assessment for solar energy systems
• Net Metering: Available for systems up to 2 MW

Indiana Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available through most utilities
• Property Tax Exemption: 100% for solar installations

Iowa Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Solar Energy System Tax Credit: 15% of the federal credit amount
• Net Metering: Available through most utilities
• Property Tax Exemption: 100% for five years

Kansas Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Property Tax Exemption: Lifetime exemption for residential solar systems
• Net Metering: Available for systems up to 100 kW

Kentucky Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available through most utilities
• Property Tax Exemption: 100% for residential solar systems

Louisiana Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available through most utilities
• Property Tax Exemption: 100% for residential solar systems

Maine Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Energy Billing: Allows customers to receive credits for excess energy
• Property Tax Exemption: Available in some municipalities

Maryland Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Residential Clean Energy Grant Program: $1,000 for solar installations
• Solar Renewable Energy Certificates (SRECs): Allows homeowners to sell credits
• Property Tax Exemption: 100% for solar energy systems
• Sales Tax Exemption: 100% for solar energy equipment

Massachusetts Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Residential Renewable Energy Income Tax Credit: 15% of system cost, up to $1,000
• Solar Massachusetts Renewable Target (SMART) Program: Incentives for solar production
• Net Metering: Available for systems up to 10 MW
• Property Tax Exemption: 100% for 20 years

Michigan Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available through most utilities
• Property Tax Exemption: 100% for residential solar systems

Minnesota Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Solar*Rewards Program: Production-based incentive for solar energy
• Net Metering: Available for systems up to 40 kW
• Property Tax Exemption: 100% for the value added by solar installations

Mississippi Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available through some utilities

Missouri Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Property Tax Exemption: 100% for residential solar systems
• Net Metering: Available for systems up to 100 kW

Montana Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Alternative Energy Systems Credit: Up to $500 per individual taxpayer
• Net Metering: Available for systems up to 50 kW
• Property Tax Exemption: 100% for 10 years

Nebraska Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available for systems up to 25 kW
• Property Tax Exemption: 100% for solar energy systems

Nevada Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available with compensation at 75% of retail rate
• Property Tax Exemption: 100% for solar energy systems
• Solar Access Rights: Protects homeowners' right to install solar

New Hampshire Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Residential Small Renewable Energy Rebate Program: $200 per kW, up to $1,000
• Net Metering: Available with surplus credits carried over indefinitely
• Property Tax Exemption: Available in participating municipalities

New Jersey Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Successor Solar Incentive Certificates (SuSIs): Earn credits for solar production
• Sales Tax Exemption: 100% for solar energy equipment
• Property Tax Exemption: 100% for solar energy systems
• Net Metering: Available for systems up to 5 MW

New Mexico Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Solar Market Development Tax Credit: 10% of system costs, up to $6,000
• Property Tax Exemption: 100% for solar energy systems
• Sales Tax Exemption: 100% for solar energy equipment
• Net Metering: Available with excess credits carried over indefinitely

New York Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• NY-Sun Megawatt Block Incentive: Varies by region and system size
• State Solar Equipment Tax Credit: 25% of system costs, up to $5,000
• Property Tax Abatement: 30% of the system cost is deducted from the property tax bill in certain municipalities, 7.5% a year for four years.
• Net Metering: Available with excess credits carried over

North Carolina Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Property Tax Exemption: 80% for solar energy systems
• Net Metering: Available through most utilities

North Dakota Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Renewable Energy Property Tax Exemption: 100% for five years
• Net Metering: Available for systems up to 100 kW

Ohio Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Solar Renewable Energy Credits (SRECs): Earn credits for solar production
• Property Tax Exemption: 100% in participating counties
• Net Metering: Available through most utilities

Oklahoma Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available through some utilities
• Property Tax Exemption: 100% for solar energy systems

Oregon Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Energy Trust of Oregon Incentives: Cash incentives for solar installations
• Property Tax Exemption: 100% for solar energy systems
• Net Metering: Available for systems up to 25 kW

Pennsylvania Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Solar Renewable Energy Credits (SRECs): Earn credits for solar production
• Property Tax Exemption: 100% in participating municipalities
• Net Metering: Available for systems up to 50 kW

Rhode Island Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Renewable Energy Growth Program: Performance-based incentives for solar
• Property Tax Exemption: 100% for solar energy systems
• Sales Tax Exemption: 100% for solar energy equipment
• Net Metering: Available for systems up to 10 MW

South Carolina Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• State Tax Credit: 25% of system costs, up to $3,500 or 50% of tax liability
• Property Tax Exemption: 100% for solar energy systems
• Net Metering: Available through most utilities

South Dakota Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Renewable Energy System Tax Exemption: 100% for solar energy systems
• Net Metering: Not currently mandated statewide

Tennessee Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Green Energy Property Tax Assessment: Assessed at 12.5% of installation costs
• Net Metering: Available through some utilities

Texas Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Property Tax Exemption: 100% for solar energy systems
• Net Metering: Varies by utility and municipality

Utah Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Renewable Energy Systems Tax Credit: 25% of system costs, up to $1,600
• Property Tax Exemption: 100% for solar energy systems
• Net Metering: Available with compensation at avoided cost rate

Vermont Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available with excess credits carried over
• Property Tax Exemption: 100% for solar energy systems

Virginia Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Property Tax Exemption: Available in some localities
• Net Metering: Available for systems up to 20 kW residential, 1 MW non-residential

Washington Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Sales Tax Exemption: 100% for systems up to 100 kW
• Net Metering: Available for systems up to 100 kW
• Property Tax Exemption: 100% for solar energy systems

West Virginia Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available for systems up to 25 kW residential, 500 kW commercial

Wisconsin Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Focus on Energy Incentives: Cash rebates for solar installations
• Net Metering: Available through most utilities
• Property Tax Exemption: 100% for solar energy systems

Wyoming Solar Incentives

• Federal Solar Investment Tax Credit (ITC): 30% tax credit on solar system costs
• Net Metering: Available for systems up to 25 kW
• Property Tax Exemption: 100% for solar energy systems

Final Thoughts

Solar incentives vary widely across states, offering various tax credits, rebates, and net metering options. These programs significantly reduce the cost of installing solar panels and enhance the return on investment. However, incentives can change over time, and availability may vary within each state. It's crucial to consult with local solar installers or state energy offices for the most current information.

Disclaimer: Solar incentives are subject to change. Homeowners should verify current programs and eligibility requirements with local authorities and professional installers.