2023 Solar Incentives Guide for El Dorado, AR - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in El Dorado.
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 March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in El Dorado?
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The term "solar incentives" refers to financial incentives put in place by solar companies and the government to encourage the adoption and use renewable energy by making installing and using solar panels more affordable. Solar incentives could include upfront discounts, cash back or monthly credits towards your utility bill. Some incentives are handled by the federal government, some by the Arkansas government and some by your utility company, county or municipality. Categories of solar incentives include:
- Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (A tax credit is different from a tax deduction.)
- Net Metering: Net metering factors in once your solar panels are up and running. If you have in place a net metering agreement with your El Dorado utility company, the company will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in other places you might make back a percentage of the value.
- Tax Exemptions: Your solar panel system may qualify for both sales tax and property tax exemptions. Sales tax exemptions are applied at the time of purchase. Property tax exemptions let you exclude the value added by your solar panels when calculating property taxes on your home.
- Rebates: A rebate is a partial refund given after you've purchased your solar system. Rebates could 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 calculating tax credits.
Federal Solar Incentives
Federal solar incentives are likely the first thing that you think of when thinking about solar incentives. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit equal to a specified percentage of the money you spend installing solar panels.
The ITC initially applied to 30% of the total cost of installing a solar system, although that number has fluctuated slightly over time between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total cost of installation includes the panels themselves as well as the cost of accessories, equipment and labor. There is no maximum amount you can claim. The ITC can be applied to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be owned by you and in the United States.
Your local El Dorado solar panel installer can give you more information about the ITC and how it applies to your situation.
The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as renaming it to the Clean Energy Credit). The Clean Energy Credit re-raises the credit up to 30% for solar installations undertaken between January 1, 2022 and December 31, 2032. At this point, the percentage will decrease slightly each year until the program expires in 2035. Starting in 2023, the expansion will also make claiming credit for energy storage systems easier than ever before.
More information about the new Inflation Reduction Act can be found here. Your local El Dorado solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it may apply to you.
State & Local Solar Incentives
Some solar incentives are often also offered at the local or state level. Like with federal incentives, these could include rebates, tax credits and more. These incentives might be provided by the Arkansas government, or by your county or municipality. Some incentives may be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in El Dorado
There are many kinds of solar incentives: those offered by the federal government, those offered by the Arkansas government and those offered by local utility companies, to name a few. Solar energy utilization has grown tremendously in the last 15 years, partially thanks to these incentives. Reach out to your local solar panel installation expert today to discover more about the various programs and to save as much money as possible on a solar system for your El Dorado home.
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
Best Warranty Coverage
Sunpro Solar
- Industry-leading warranty coverage
- Expansive service area
- Some reported communication issues
- No leases or PPAs
EcoWatch's El Dorado, AR Solar Incentives FAQs
How do I know if I qualify for different solar incentives?
It's best to speak with your local El Dorado solar installer for a better understanding of which incentives your project may qualify for. Typically, solar incentives apply to new solar panel systems installed on a property you own (in the U.S.) between the dates specified by the incentive. Some incentives, such as those provided at the level of the Arkansas government, might have additional requirements.
How much can I save annually on my electric bill if I add solar panels to my El Dorado home?
Generally, homeowners in El Dorado who install solar panels save approximately $999.67 per year, or approximately $18,993.78 over 20 years after they make the switch.
What are the highest-rated solar panel installation companies near me?
To learn about the best solar panel installation companies near you, take a look at our article on the best solar companies in El Dorado.
When does the federal solar tax credit end?
The federal solar tax credit, formerly called the ITC and now named the Clean Energy Credit, is set to end January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
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. Make sure you talk through your ideas with your local El Dorado solar installer. They can help you with the 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.