2024 Solar Incentives Guide for Troy, AL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Troy.
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.
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What Solar Tax Credits, Incentives, and Rebates are Available in Troy?
Local Option- Property Tax Exemption for Renewable Energy Faclities
Alabama Power - Residential Heat Pump Loan Program
Dixie Electric Cooperative - Residential Energy Efficiency Rebate Program
South Alabama Electric Cooperative - Residential Energy Efficiency Loan Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are designed to mitigate the cost of installing a solar panel system on your home. These financial incentives are designed to encourage more people to switch their home over to renewable energy. These incentives can include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are handled by the federal government, some by the state of Alabama and some by your specific utility company, county or municipality. Types of solar incentives might include:
- Tax Exemptions: Tax exemptions can come in two forms. The first is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption, which allows you to exclude the value added by your solar system when paying property tax on your house.
- Net Metering: Net metering is an incentive you can get once your solar system is up and running. If you've signed a net metering agreement with your Troy utility company, the company 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 receive a refund equivalent to a percentage of the value.
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
- Rebates: Rebates, or partial refunds after a purchase, are typically applied before any solar tax credits are calculated. Rebates might be provided by your local utility company, by your state or by your county.
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SunPower
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Tesla Energy
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Federal Solar Incentives
When you hear the term "solar incentives," federal incentives may be the first thing that comes to mind. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit equal to a specified percentage of the money you spend on solar panels for your home.
The ITC can be applied to solar panels installed on your primary or secondary residence in the United States. The solar system must have been installed on a property you own after January 1, 2006, for you to be eligible for the credit. Originally, the ITC covered 30% of all system costs (panels, labor, equipment and accessories), although the amount has fluctuated slightly over time between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the claim amount.
Your local Troy solar panel installation expert can offer more information about the ITC and how it applies to your situation.
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. The Clean Energy Credit has increased the current credit up to 30% for solar installations undertaken between January 1, 2022, and December 31, 2032. After this, the credit percentage will see a slight decrease annually until the program expires in 2035. Starting in 2023, the expansion to the program will also make claiming credit for energy storage systems easier than ever before.
Click here to learn more about the new Inflation Reduction Act. Your local Troy solar panel company can answer any questions you have and explain how the new Clean Energy Credit applies to you.
State & Local Solar Incentives
In addition to those provided at the federal level, there are often also state solar incentives. Tax credits, rebates and more may be available at a more local level. These solar incentives — which may be handled by the state of Alabama, or by your county or municipality — may be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Troy
There are many kinds of solar incentives: those given by local utility companies, those provided by the Alabama government and those provided by the federal government, to name a few. Solar energy utilization has increased tremendously in the last 15 years, thanks to these incentives. Call your local solar panel installer today to find out more information and to save as much money as possible on a solar system for your Troy home.
EcoWatch's Troy, AL Solar Incentives FAQs
Who installs solar panels near me?
To discover the best solar panel installation companies near you, take a look at our article on Troy's best solar panel companies.
How long until the federal solar tax credit ends?
The Clean Energy Credit (previously called the federal solar tax credit, or the ITC), is slated 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 trade in my old appliances for ones that are more energy-efficient. Are there any benefits I can claim?
Under the new Inflation Reduction Act, there are a variety of new financial incentives for making eco-friendly improvements to your home. More details about these incentives, including information about incentives for purchasing new appliances, can be found here.
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 applying for, they may apply in a different order. Be sure to speak with your solar installer or a local tax professional to confirm that you are claiming incentives correctly and that you're getting the most money you can.
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.