2025 Solar Incentives Guide for Daphne, AL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Daphne.
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 Daphne?
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/
Solar incentives are designed to make renewable energy usage more affordable via financial incentives to help people install solar panels on their homes. Incentives may include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are handled federally, while others are offered by the state of Alabama or by your specific utility company, county or municipality. Some solar incentives you might qualify for are:
- Net Metering: Make sure you speak with your Daphne utility company about signing a net metering contract. This will allow you to receive credit towards your utility bill every month for the value of excess energy your solar panels generate. You may receive either a dollar-for-dollar credit or a percentage of the value.
- Tax Exemptions: These may come in the form of property tax exemptions, which allow you to exclude the value of your solar system when paying taxes on your home. You may also qualify for an exemption on sales tax at the time of purchase.
- Rebates: Solar rebates may be offered by your state or county, or by your local utility company. These rebates are essentially partial refunds that are applied after you purchase a solar system and before tax credits are calculated.
- Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
Federal Solar Incentives
When people think of solar incentives, federal incentives might be the first thing that comes to mind. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a certain percentage of the cost of your solar system.
The ITC applies to the value of a solar system 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 claim the credit. Originally, the ITC covered 30% of all installation costs (panels, equipment, accessories and labor), although the total amount has fluctuated over time 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.
To more fully understand how the ITC may apply to you, reach out to your local Daphne solar panel installation expert and request more information.
In August 2022, the ITC (now referred to as the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. For solar system installations that begin after January 1, 2022, and are completed by the end of 2032, homeowners can apply for a credit for 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit expires in 2035. The program expansion also makes it easier to get credit for energy storage systems, starting in 2023.
More information about the new Inflation Reduction Act can be found here. The easiest way to understand how the new Clean Energy Credit will apply to you is to talk with your local Daphne solar panel company.
State & Local Solar Incentives
Some solar incentives may be offered at the local or state level. Similar to federal incentives, these may include rebates, tax credits and more. Incentives might be offered by your county or municipality, or by the state of Alabama. Some incentives may be available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Daphne
Solar energy use nationwide has gone up significantly in the past 15 years, in part due to the increase in availability of solar incentives. You might receive these incentives from the federal government, the Alabama government or your local utility company. Call your local solar panel installation company today to discover more about the various programs and to save the most money possible on solar panels for your Daphne home.
EcoWatch's Daphne, AL Solar Incentives FAQs
How can I find out if I qualify for specific solar incentives?
It's best to speak with your local Daphne solar installer for a better understanding of which incentives your project may qualify for. Generally, solar incentives apply to new solar panel systems installed on a property you own (in the U.S.) within a specified date range. Some incentives, like those provided at the level of the Alabama government, might have other requirements.
How much can I save annually on my electric bill if I add solar panels to my Daphne home?
On average, Daphne homeowners who install solar panels save around $1,124.00 per year, or around $21,356.02 over 20 years after they make the switch.
Who installs solar panels near me?
To find the right solar panel installer for you, check out our guide to Daphne's top solar panel companies.
How long until the federal solar tax credit ends?
The Clean Energy Credit (previously referred to as the federal solar tax credit, or the ITC), currently ends on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
If I trade in my appliances for ones that utilize solar energy, are there any benefits I can claim?
The new Inflation Reduction Act introduces several incentives designed to reward homeowners for making eco-friendly upgrades. Some incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.
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.