2024 Solar Incentives Guide for Pelham, AL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Pelham.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 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 Pelham solar installers to see how much you can save.
Please enter a valid 5-digit zip code!
Why you can trust EcoWatch
What Solar Tax Credits, Incentives, and Rebates are Available in Pelham?
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 people to switch to renewable energy by offering incentives meant to lower the financial burden of solar panel installation and use. Incentives might include things like discounts, cash back or credit on your utility bill each month. Some incentives are offered by the federal government, while others are offered by the Alabama government or your utility company, county or municipality. Some broad categories of solar incentives include:
- Net Metering: Net metering factors in once your solar panels are up and running. If you have a net metering agreement with your Pelham utility company, it will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in other areas you may get refunded a percentage of the value.
- Rebates: Some solar companies will help you claim a rebate, or partial refund of your purchase, for your solar system. States or counties will also sometimes offer limited-time rebates. Any rebates you receive will usually be deducted from the total price before tax credits are calculated.
- Tax Exemptions: Your solar panel system could qualify for both sales tax and property tax exemptions. Sales tax exemptions are effective at the time of purchase. Property tax exemptions let you exclude the added value of the solar panels when calculating property taxes on your home.
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
Best National Provider
SunPower
- 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
- 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
Federal Solar Incentives
Federal solar incentives are probably the first thing that comes to mind when you think about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is the most commonly known federal solar incentive. The ITC provides a tax credit for a predetermined percentage of your solar system's cost.
The ITC is applied to the total cost of solar system installation, including the panels themselves as well as equipment, accessories and labor. You can claim this credit for panels installed after January 1, 2006, on a primary or secondary residence that you own, as long as it is located in the United States. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum claim amount.
To better understand how the ITC could apply to your situation, call your local Pelham solar panel installation expert and ask for more information.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). The new Clean Energy Credit extends until 2035. You can now apply for a 30% credit for solar systems that began installation on or after January 1, 2022, and will be done by December 31, 2032. The credit will then decrease annually until it expires. The program expansion also makes credits for energy storage systems even easier to claim, beginning in 2023.
More information about the new Inflation Reduction Act can be found here. Your local Pelham solar panel company can answer any questions you have and explain how the new Clean Energy Credit applies to you.
State & Local Solar Incentives
There are often also state solar incentives in addition to those provided by the federal government. Tax credits, rebates and more may be available at a more local level. Some incentives are ongoing, while others are offered for only a limited time. Your local solar incentives might come from the Alabama government, or from your specific county or municipality.
Next Steps for Installing Solar in Pelham
You can apply for and receive solar incentives from the Alabama government and the federal government, as well as from your local utility company. Growing availability of solar initiatives in the past 15 years has helped increase solar adoption nationwide. Contact your local solar panel installer today to discover more about the various programs and to save the most money possible on solar panels for your Pelham home.
EcoWatch's Pelham, AL Solar Incentives FAQs
How do I know if I qualify for solar incentives?
It's a smart idea to get in touch with your local Pelham solar installer to get an understanding of which incentives your project will qualify for. In most cases, solar incentives apply to new solar systems installed on 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 other requirements.
If my house already has solar panels, can I still claim incentives?
If your solar panels were installed after January 1, 2022, you may qualify for the recently increased 30% tax credit under the Inflation Reduction Act. If you installed your system between 2006 and 2021, you may qualify for a tax credit between 26% and 30%, depending on the year it was installed. Speaking with a representative from the company that installed your solar system, or any local Pelham solar installer, can help you understand what incentives you can apply for.
Who installs solar panels near me?
To find the best solar panel installer in your area, check out our guide to Pelham's best solar panel companies.
What are some environmental benefits of adding solar panels to my house?
You can decrease your carbon footprint by 450 pounds of CO2 a year by installing solar panels. This adds up to approximately 9,000 pounds over 20 years. Solar is also a renewable energy source, meaning that making the switch reduces the drain on our planet's resources.
How long until the federal solar tax credit ends?
The Clean Energy Credit (formerly called the federal solar tax credit, or ITC), currently ends on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
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.