2023 Solar Incentives Guide for Foley, AL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Foley.
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 Foley?
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 intended to encourage homeowners to switch to renewable energy by offering financial incentives that lower the burden of solar panel installation and use. Incentives could include things like discounts, cash back or credit on your utility bill each month. Some incentives are provided by the federal government, while others are offered by the Alabama government or by your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Tax Exemptions: These might come in the form of property tax exemptions, which let you ignore the value added by your solar panels when paying taxes on your house. You could also look for exemptions on sales tax at the time of purchase.
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (A tax credit is different from a tax deduction.)
- Rebates: Some solar companies will help you claim a rebate, or partial refund after purchase, for your solar system. Counties or states will also offer limited-time rebates at various times. Any rebates you receive will usually be deducted from your total price before any tax credits are calculated.
- Net Metering: Net metering becomes relevant once your solar system is up and running. If you have a net metering agreement with your Foley utility company, they will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some locations, this is a dollar-for-dollar credit, while in other places you might be refunded a percentage of the value.
Federal Solar Incentives
Federal solar incentives are probably the first thing that comes to mind when thinking about solar incentives. An incentive that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a certain percentage of the cost of your solar system.
The ITC applies to a solar system installed on your primary or secondary residence in the United States. The solar panels have to have been installed on a property you own after January 1, 2006 for you to claim the credit. The ITC originally paid out 30% of all costs (panels, labor, accessories and equipment), although the total 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.
To better understand exactly how much money the ITC could save you, speak with your local Foley solar panel installer.
The ITC has been renewed and expanded following the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The Clean Energy Credit has increased the current credit up to 30% for solar systems installed between 2022 and 2032. After 2032, the credit percentage will decrease slightly each year until the end of the program in 2035. Starting in 2023, it will also be easier to qualify for credits for energy storage systems with the new act.
Click here to learn more about the new Inflation Reduction Act. Your local Foley solar panel company can answer any questions you have and explain how the new Clean Energy Credit may apply to you.
State & Local Solar Incentives
Some solar incentives may be provided by state and local governments. Like with federal incentives, these could include tax credits, rebates and more. Some incentives are ongoing, while others are available for a limited time. Solar incentives might be offered by your county or municipality, or by the Alabama government.
Next Steps for Installing Solar in Foley
The expanding number of solar incentives available has contributed greatly to the increase in the adoption of solar energy nationwide over the past 15 years. You might qualify for solar incentives from the federal government, the Alabama government or from your local utility company. Contact your local solar panel installation company today to discover more about the various programs and to save as much money as possible on solar panels for your Foley home.
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EcoWatch's Foley, AL Solar Incentives FAQs
I already have solar panels. Do I qualify for any incentives?
An excellent idea would be to talk to the company that installed your system — or get in touch with a local Foley solar installer — to better understand which incentives you may qualify for. If your system was installed after January 1, 2022, you likely qualify for the recently increased 30% tax credit under the Inflation Reduction Act. Solar panels installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
How much can I save annually on my electric bill if I install solar panels on my Foley home?
After adding solar panels to your house in Foley, you can anticipate savings of about $1,106.58 per year, or about $21,025.05 over 20 years.
Who installs solar panels near me?
To learn about the best solar panel installers near you, take a look at our article on Foley's best solar panel companies.
When does the federal solar tax credit end?
The Clean Energy Credit (previously referred to as the federal solar tax credit, or the ITC), is scheduled to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I use a combination of multiple types of renewable energy to power my home?
Yes, you can employ multiple types of renewable energy to power your home, such as a combination of geothermal and solar. You can also combine renewable energy generation with a non-renewable backup source of energy. Be sure to discuss your plan with your local Foley solar installation expert, so that you understand what you'll need and what kinds of incentives you will or won't 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.