2025 Solar Incentives Guide for Cullman, AL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Cullman.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Cullman?
Local Option- Property Tax Exemption for Renewable Energy Faclities
Alabama Power - Residential Heat Pump Loan Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The phrase "solar incentives" includes a range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Different kinds of incentives, including cash back, discounts or credit towards your monthly utility bill, might be available to you. Certain incentives may be offered by the state of Alabama, by your utility company or by county or municipality, while other incentives are federal. You might qualify for any of the following types of solar incentives:
- Net Metering: You may be able to sign a net metering contract with your Cullman utility company that will apply to all or a percentage of the excess electricity that is generated by your solar panels. Your utility company will then deduct this value from your utility bill each month.
- Rebates: A rebate is a partial refund after the purchase of your solar system. These may be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the federal government.
- Tax Exemptions: Tax exemptions can come in two forms. First, there is sales tax exemption, which is applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to ignore the value added by your solar system when calculating property tax for your house.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some knowledge of. The Federal Solar Investment Tax Credit, or ITC, is the best-known federal solar incentive. The ITC provides a tax credit for a set percentage of your solar system's cost.
The ITC can be credited towards the value of solar panels installed on your primary or secondary residence in the United States. The solar panels must have been installed after January 1, 2006, on a property you own for you to be eligible for the credit. Originally, the ITC covered 30% of all system costs (panels, labor, equipment and accessories), although the amount has fluctuated over the last few years between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the claim amount.
Your local Cullman solar panel installation expert can provide you with more information about the ITC and how it applies to your situation.
The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as retitling it the Clean Energy Credit). Under the new program, solar installation projects that are completed between 2022 and 2032, might qualify for a 30% tax credit. This credit amount will then see a slight annual decrease until the end of the current Clean Energy Credit in 2035. Starting in 2023, the expansion will also make it easier to get credit for energy storage systems.
Click here to learn more about the new Inflation Reduction Act. Your local Cullman solar panel company can answer your questions and explain how the new Clean Energy Credit applies to you.
State & Local Solar Incentives
Some solar incentives may be provided by state and local governments. Similar to federal incentives, these might include rebates, tax credits and more. These incentives might be given out by the Alabama government, or by your county or municipality. Some are available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Cullman
The variety of available solar incentives has helped tremendously increase the nationwide adoption of solar energy over the last 15 years. You might qualify for solar incentives from the Alabama government, the federal government or your local utility company. We recommend talking to your local Cullman solar installation expert for more information about these incentives and to ensure that you're getting the largest number possible for your solar system.
EcoWatch's Cullman, AL Solar Incentives FAQs
How do I know if I qualify for specific solar incentives?
It's a good idea to talk to your local Cullman solar installer to get an understanding of which incentives your project will qualify for. In most cases, solar incentives apply to new solar systems installed on property you own (in the U.S.) within a specified date range. Some incentives, such as those provided by the Alabama government, might have other requirements.
What are some environmental benefits of adding solar panels to my house?
Solar energy is a renewable energy source — by changing where you get your energy, you help lessen the strain on our planet's resources. A solar system can also lower the CO2 emissions from your home by 0 pounds yearly, or around 0 pounds over 20 years.
Can I use a combination of multiple types of renewable energy to power my home?
You can power your home with multiple types of renewable energy, or a combination of renewable and non-renewable energy. Make sure you talk through your plan with your local Cullman solar installer. They can help you as you plan for your project and educate you on the various incentives that you might or might not qualify for.
Can I get any financial incentives when I add solar panels to a rental property, vacation home or commercial property?
While we recommend speaking with your local solar installer and/or tax professional to best understand what solar incentives apply to you, many incentives can be claimed on a second home, so long as that home is in the United States and owned by you. There may be additional incentives available for commercial properties specifically, depending on the details.
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.