2023 Solar Incentives Guide for Leeds, AL - Tax Credits & Rebates

In this guide, we'll cover the latest solar incentives and rebates available in Leeds.

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.
Get a free quote from one of our trusted Leeds solar installers to see how much you can save.

By EcoWatch Local Advisors

Data Analysis: James Savino

Ranking Methodology: Karsten Neumeister

Updated January 20, 2023

Why you can trust EcoWatch

We work with a panel of solar experts to create unbiased reviews that empower you to make the right choice for your home. No other site has covered renewables as long as us, which means we have more data and insider information than other sites. Our rankings are never affected by revenue or partnerships.

What Solar Tax Credits, Incentives, and Rebates are Available in Leeds?

Wood-Burning Heating System Deduction

Incentive Type:
Personal Tax Deduction

Local Option- Property Tax Exemption for Renewable Energy Faclities

Incentive Type:
Property Tax Incentive

Alabama Power - Residential Heat Pump Loan Program

Incentive Type:
Loan Program
Varies, up to 100% of project cost for qualifying customers

Federal Residential Renewable Energy Tax Credit

Incentive Type:
Personal Tax Credit
30% federal tax credit for systems placed in service after 12/31/2021 and before 01/01/2033. Good for: solar water heat, solar photovoltaics, biomass, geothermal heat pumps, wind (small), fuel cells using renewable fuels.

Source: https://www.dsireusa.org/


Solar incentives are intended to encourage people to switch their home over to renewable energy by providing incentives that lower the financial burden of solar panel installation and use. Various types of incentives, like cash back, discounts or monthly utility bill credits, might be available to you. Some incentives may be offered by the Alabama government, by your utility company or by county or municipality, while other incentives are federal. Some solar incentives you might qualify for are:

  • Net Metering: Make sure you speak to your Leeds utility company about signing a net metering agreement. This allows you to receive credit towards your utility bill every month for the value of excess energy generated by your solar panels. You may receive either a dollar-for-dollar credit or a percentage of the value.
  • Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (This is different from a tax deduction.)
  • Rebates: A rebate is a partial refund after the purchase of your solar system. Rebates could be offered by your local utility company, your state or your county. The cash back that you get from the rebates is normally applied before tax credits are calculated.
  • Tax Exemptions: Your solar panels may qualify for both sales tax and property tax exemptions. Sales tax exemptions are applied at the time of purchase. Property tax exemptions allow you to exclude the added value of the solar panels when you are calculating property taxes on your home.

Federal Solar Incentives

When thinking about solar incentives, federal incentives are likely the first thing that comes to mind. A federal incentive that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a certain percentage of the cost of your solar system.

The ITC applies towards solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, labor, accessories and equipment. This credit can be claimed on solar panels installed on a primary or secondary residence in the United States that you own. Originally, you could claim 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum amount you can claim.

To more fully understand how the ITC might apply to you, call your local Leeds solar panel installation expert and request more information.

The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit is valid until 2035. Solar installation projects started after January 1, 2022 and completed by the end of 2032 may qualify for a 30% tax credit. This amount will then decrease slightly each year until the current program ends. The program expansion also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.

More information about the new Inflation Reduction Act can be found here. The best way to learn more about how the new Clean Energy Credit applies to you is to talk with your local Leeds solar panel company.

State & Local Solar Incentives

There are more than just federal solar incentives; rebates, tax credits and more might also be offered at the state and local level. These incentives may be given out by your county or municipality, or by the Alabama government. Some are available for a limited time, while others are ongoing.

Next Steps for Installing Solar in Leeds

Solar incentives may be offered by your local utlity company, the Alabama government or the federal government. The growing number of solar incentives available has helped nationwide use of solar energy increase greatly in the last 15 years. Your local Leeds solar panel installer can provide you with more details about which incentives you might qualify for, and get you feeling good about making the change to renewable energy today.

Best National Provider

SunPower

★★★★★
5.0

  • Most efficient panels on the market
  • National coverage
  • Cradle to Cradle sustainability certification
  • Great warranty coverage
  • Expensive
  • Customer service varies by local dealer

Best Technology

Tesla Energy

★★★★★
4.5

  • 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 Leeds, AL Solar Incentives FAQs

Can I receive any incentives when I add solar panels to a rental property, vacation home or commercial property?

Many solar incentives are intended to apply to a property located within the United States that you own, and most secondary residences will fall into this category. There may be other solar incentives available for commercial properties, depending on the details. We recommend reaching out to your local solar installer and/or tax professional to best understand what incentives may apply to your specific situation.

How can I find out if I qualify for certain solar incentives?

It's a smart idea to get in touch with your local Leeds solar installer for a better understanding of which incentives your project may qualify for. Usually, 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, such as those provided at the level of the Alabama government, might have additional requirements.

How much can I save annually on my electric bill if I add solar panels to my house in Leeds?

Once you add solar panels to your home in Leeds, you can anticipate savings of about $1,126.68 per year, or about $21,406.84 over the next 20 years.

How long until the federal solar tax credit ends?

The Clean Energy Credit (previously called 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 qualify for incentives both towards the up-front cost of solar panels, and later as reimbursement?

Yes, you can claim both tax credits and rebates towards the cost of solar panels. Depending on precisely which incentives you are claiming, they may apply in a different order. Make sure that you speak with your solar installer or a local tax professional to confirm that you are claiming incentives correctly and getting the most money possible.

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.

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