2023 Solar Incentives Guide for Pell City, AL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Pell City.
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 May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Pell City?
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 meant to help mitigate the cost of installing a solar panel system on your home. This category of financial incentives is in place to encourage more people to make the switch to renewable energy. Incentives can include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered by the federal government, while others are handled by the Alabama government or your utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Rebates: Rebates, or partial refunds after a purchase, are typically given prior to any solar tax credits being calculated. These rebates might be offered by your local utility company, by your state or by your county.
- Tax Exemptions: Sales tax exemptions are effective at the point of sale for your solar panels. Property tax exemptions allow you to ignore the added value of your solar system when you're calculating the amount of property tax you need to pay on your house.
- Net Metering: Net metering is an incentive you can get after your solar system is up and running. If you've signed a net metering agreement with your Pell City utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in other areas you may receive a refund equivalent to a percentage of the value.
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (This is different from a tax deduction.)
Federal Solar Incentives
Federal solar incentives are likely to be the first thing that you think of when thinking about solar incentives. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit equal to a certain percentage of the money you spend on solar panels for your home.
The ITC applies to solar systems installed after January 1, 2006 on a primary or secondary residence in the United States that you own. Initially, the credit applied to 30% of the total cost — for panels, accessories, labor and equipment — although the percentage may range from 26-30%, depending on when your solar system was installed. There is no cap on the claim amount.
To find out exactly how much money the ITC could save you, get in touch with your local Pell City solar panel installer.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now titled the Clean Energy Credit. The Clean Energy Credit runs until 2035. Solar installation projects started after January 1, 2022 and completed by the end of 2032 may qualify for a 30% tax credit. The amount will be decreased slightly on a yearly basis until the end of the current program. The 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. Your local Pell City 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
Rebates, tax credits and more might be claimed at multiple levels. Along with federal solar incentives, there are often state and local ones as well. These incentives might be handled by the Alabama government, or by your county or municipality. Some are ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Pell City
Solar incentives can come from your local utility company, the federal government or the Alabama government. The large number of solar incentives available has facilitated the nationwide growth of solar energy use in the last 15 years. We suggest talking to your local Pell City solar installer to learn more about these incentives and to ensure that you're getting the most money possible for your solar panels.
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EcoWatch's Pell City, AL Solar Incentives FAQs
Can I claim incentives for adding 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 under this distinction. There may be other solar incentives available for commercial properties, depending on the specifics. We recommend speaking with your local solar installer and/or tax professional to fully understand what incentives apply to your specific situation.
How can I find out if I qualify for certain solar incentives?
It's best to speak with your local Pell City solar installer for a better understanding of which incentives your project will qualify for. Usually, solar incentives apply to new solar systems installed on a property you own (in the U.S.) within a specified date range. Some incentives, such as those given by the state of Alabama, might have additional requirements.
What are some environmental benefits of adding solar panels to my house?
You can lower your carbon footprint by 450 pounds of CO2 a year when you install solar panels. This adds up to approximately 9,000 pounds in 20 years. Solar is also a renewable energy source, which means that switching your home over lessens the drain on our planet's resources.
Can I claim incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can receive both rebates and tax credits towards the cost of solar panels. Depending on precisely which incentives you are claiming, they may apply in a different order. Be sure to speak with your solar installer or a local tax professional to ensure that you are claiming the correct incentives and that you're getting the most money you can.
Can I use multiple types of renewable energy to power my home?
You can use multiple types of renewable energy, or a combination of renewable and non-renewable energy, to power your home. Be sure to talk through your ideas with your local Pell City solar installation expert. They can help you as you plan for your project and give you an understanding of various incentives that you might or might not 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.