2025 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 2024 and beyond)
- Ways to optimize your solar investment
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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 designed to encourage homeowners to switch to renewable energy by providing incentives meant to lower the financial burden of solar panel installation and use. The incentives could include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are provided by the federal government, some by the state of Alabama and some by your specific utility company, county or municipality. Categories of solar incentives include:
- Tax Exemptions: These might come in the form of property tax exemptions, which let you exclude the value added by your solar panels when calculating the taxes you pay on your home. You may also qualify for an exemption on sales tax at the time of purchase.
- Rebates: Some solar companies will help you claim a rebate, or partial refund after purchase, for your solar system. Counties or states will also sometimes offer limited-time rebates. The value of a rebate will usually come off the total price before tax credits are calculated.
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
- Net Metering: Net metering factors in after your solar panels are up and running. If you have a net metering agreement with your Foley utility company, it will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in other places you might make back a percentage of the value.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have heard of. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a certain percentage of the money you spend on your solar system.
The ITC can be applied to solar systems installed after January 1, 2006, on a primary or secondary residence that you own in the United States. Initially, the credit applied to 30% of the total cost – for panels, accessories, labor and equipment – although it may range from 26-30%, depending on when your solar system was installed. There is no cap on the amount you can claim.
Have questions about how the ITC applies to your specific situation? Reach out to your local Foley solar panel installer to get more information.
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. Under the new program, solar installation projects begun after January 1, 2022, and finished by December 31, 2032, might qualify for a 30% tax credit. The amount of the credit will then see a slight annual decrease until the current Clean Energy Credit expires in 2035. Beginning 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. Your local Foley solar panel installation experts 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. As with federal incentives, these could include tax credits, rebates and more. Certain incentives are ongoing, while others are only available for a limited time. These incentives might be provided by the Alabama government, or by your county or municipality.
Next Steps for Installing Solar in Foley
Solar energy use nationwide has gone up significantly in the past 15 years, in part thanks to the proliferation of solar incentives. You might receive these incentives from the Alabama government, the federal government or your local utility company. Your local Foley solar panel installation company can give you more information about which incentives you should apply for, and get you on track to switch to renewable energy today.
EcoWatch's Foley, AL Solar Incentives FAQs
How can I find out if I qualify for different solar incentives?
In most cases, solar incentives apply to:
- a new solar system
- installed on property you own
- within the U.S.
- between the dates specified by a particular incentive.
Specific incentives, including ones handled by the Alabama government or by your county/municipality, may have additional qualifications. Talk to your local Foley solar installer to find out what incentives your project may qualify for.
How much can I save on my electric bill annually if I add solar panels to my house in Foley?
Typically, homeowners in Foley who install solar panels save about $1,106.58 per year, or around $21,025.05 over 20 years after making the switch.
What are some of the environmental benefits of switching to solar?
You can lower your carbon footprint by 450 pounds of CO2 annually when you switch to solar panels. This adds up to approximately 9,000 pounds in 20 years. In addition, solar power is a renewable energy source, which means that making the switch lessens the drain on our planet's resources.
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.
I want to change out my appliances for ones that are more energy-efficient. Are there any credits I can apply for?
Under the new Inflation Reduction Act, there are several new financial incentives that are available when you make eco-friendly improvements to your home. More details about these incentives, including information about incentives for purchasing new appliances, can be found 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.
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.