2023 Solar Incentives Guide for Irondale, AL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Irondale.
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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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Irondale?
Wood-Burning Heating System Deduction
Local Option- Property Tax Exemption for Renewable Energy Faclities
Alabama Power - Residential Heat Pump Loan Program
Federal Residential Renewable Energy Tax Credit
The phrase "solar incentives" generally refers to financial incentives designed to encourage the use of renewable energy by making installing and using solar panels more affordable. Different kinds of incentives, such as cash back, discounts or credit towards your monthly utility bill, might be available to you. Certain incentives may be offered by the Alabama government, by your utility company or by county or municipality, while other incentives are federal. Categories of solar incentives include:
- Net Metering: You may be able to sign a net metering contract with your Irondale utility company. This agreement may apply to all or a percentage of the excess electricity that is generated by your solar panels. Your utility company will then subtract this value from your monthly utility bill.
- Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar panels. Property tax exemptions let you exclude the added value of your solar system when you're calculating the amount of property tax you need to pay on your home.
- Rebates: A solar rebate is a partial refund given after you've purchased your solar panels. 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 government.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have heard of. The Federal Solar Investment Tax Credit, or ITC, is likely the most commonly known federal solar incentive. The ITC offers a tax credit for a set percentage of the cost of your solar system.
The ITC can be applied to a solar system installed on your primary or secondary residence in the United States. The solar system must have been installed after January 1, 2006 on a property you own for you to be eligible for the credit. The ITC originally paid out 30% of all installation costs (panels, equipment, labor and accessories), although the amount has fluctuated over the 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 know exactly how much money the ITC could save you, contact your local Irondale solar panel installation expert.
The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as renaming it to the Clean Energy Credit). The new Clean Energy Credit now runs until 2035. Homeowners are now eligible for a 30% credit for solar systems that began installation after January 1, 2022 and are completed by the end of 2032. This credit will then be decreased by a few percentage points every year until it expires. Beginning in 2023, it will also be easier to claim credits for energy storage systems under this new program.
More information about the new Inflation Reduction Act can be found here. Your local Irondale solar panel installer can answer your questions and explain how the new Clean Energy Credit applies to you.
State & Local Solar Incentives
Tax credits, rebates and more might be claimed at multiple levels. On top of federal solar incentives, there are often state and local ones as well. The incentives — which might be handled by the state of Alabama, or by your county or municipality — might be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Irondale
Solar incentives might be provided by the Alabama government, the federal government or your local utility company. The large number of available incentives has contributed to a large increase in solar energy use in the last 15 years. Your local Irondale solar panel installation expert can provide you with more details about which incentives you can apply for, and get you started on the path to switching to renewable energy today.
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- Best solar battery on the market
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EcoWatch's Irondale, AL Solar Incentives FAQs
Can I get any financial incentives when I add solar panels to a vacation home, rental property or commercial property?
While we recommend getting in touch 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 other incentives available specifically for commercial properties, depending on the details.
How do I learn if I qualify for specific solar incentives?
It's a smart idea to get in touch with your local Irondale solar installer to get an understanding of which incentives your project may qualify for. In most cases, solar incentives apply to new solar panel systems installed on property you own (in the U.S.) between the dates specified by the incentive. Some incentives, like those provided at the level of the Alabama government, may have additional requirements.
How much will solar panels save me annually on my electric bill in Irondale?
Once you add solar panels to your home in Irondale, you can expect to save around $1,116.47 per year, or around $21,212.90 over 20 years.
Can I qualify for incentives both towards the initial cost of solar panels, and later as reimbursement?
The order your incentives will be applied in could vary depending on which incentives you are eligible for but usually yes, you can receive multiple types of incentives for your solar project. Check with your solar installer or a local tax professional to be sure you are claiming all of the incentives you qualify for and applying them in the correct order.
Can I use multiple types of renewable energy to power my home?
Yes, you can employ multiple types of renewable energy to power your home — for example, a combination of geothermal and solar. You can also combine renewable energy generation with a non-renewable backup source of energy. You should discuss your proposed plan with your local Irondale solar panel installer, to get an understanding of what will be needed 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.