2023 Solar Incentives Guide for Fayette, AL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Fayette.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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Updated March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Fayette?
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 mitigate the cost of installing a solar panel system on your home. Financial incentives like these are intended to encourage more homeowners to switch to renewable energy. The incentives might include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are handled by the federal government, some by the state of Alabama and some by your utility company, county or municipality. Categories of solar incentives include:
- Tax Exemptions: Tax exemptions can come in one of two forms. First, there is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when paying property tax on your house.
- Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you have in place a net metering agreement with your Fayette utility company, the company will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some places, this credit is dollar-for-dollar, while in other places you might make back a percentage of the value.
- Rebates: Solar rebates can be provided by your state or county, or by your local utility company. These rebates work as cash back that is applied after you purchase solar panels and before tax credits are calculated.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.
Federal Solar Incentives
When people think of solar incentives, federal incentives are likely 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 predetermined percentage of the cost of your solar system.
The ITC originally covered 30% of the cost of installing solar panels, although that number has fluctuated slightly over time between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total installation cost includes the panels themselves as well as the cost of equipment, accessories and labor. There is no maximum claim amount. The ITC applies to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be owned by you and in the United States.
To know exactly how much money the ITC could save you, speak with your local Fayette solar panel installation expert.
In August 2022, the Inflation Reduction Act made revisions to the ITC, now titled the Clean Energy Credit. Homeowners can now receive a credit equal to 30% of the total costs of solar system installation for projects started after January 1, 2022 and completed before the end of 2032. The credit percentage will then decrease on a yearly basis until the Clean Energy Credit expires in 2035. Starting in 2023, it will also be easier to obtain credits for energy storage systems with the new act.
Click here to learn more about the new Inflation Reduction Act. To best understand how the new Clean Energy Credit will apply to you, speak with your local Fayette solar installers.
State & Local Solar Incentives
Some solar incentives may be provided by state and local governments. Similar to federal incentives, these could include rebates, tax credits and more. Some incentives are ongoing, while others may only be available for a limited time. These incentives may be offered by the Alabama government, or by your county or municipality.
Next Steps for Installing Solar in Fayette
Solar incentives might be offered by the Alabama government, the federal government or your local utility company. The growing number of available solar incentives has facilitated the nationwide growth of solar energy use in the last 15 years. Your local Fayette solar panel installation company can give you more information about which incentives you can apply for, and get you on track to switch to renewable energy today.
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
EcoWatch's Fayette, AL Solar Incentives FAQs
How do I know if I qualify for certain solar incentives?
Generally, solar incentives apply to:
- a new solar system
- installed on property you own
- within the U.S.
- within the date range specified by a particular incentive.
Specific incentives, including those run by the Alabama government or by your county/municipality, sometimes have additional qualifications. Talk to your local Fayette solar installer to learn more about what incentives your project may qualify for.
Who installs solar panels near me?
To find the top solar panel installation companies near you, take a look at our article on the best solar companies in Fayette.
What are the environmental benefits of switching to solar?
Solar energy is renewable — by changing where you get your energy, you can help reduce the strain on our planet's resources. A solar system can also reduce your home's CO2 emissions by 450 pounds a year, or around 9,000 pounds over 20 years.
How long until the federal solar tax credit ends?
The federal solar tax credit, previously called the ITC and now titled the Clean Energy Credit, is set to end January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
Can I use multiple types of renewable energy to power my home?
Yes, you can use multiple types of renewable energy to power your home, such as a combination of wind and solar. You can also use both renewable energy sources and a backup source of non-renewable energy. You should discuss your proposed plan with your local Fayette solar panel installer, so that you understand what you'll need and what kinds of incentives you might or might not qualify for.
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.