2024 Solar Incentives Guide for Flagstaff, AZ - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Flagstaff.
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 Flagstaff?
Solar and Wind Equipment Sales Tax Exemption
Residential Solar and Wind Energy Systems Tax Credit
Qualifying Wood Stove Deduction
Energy Equipment Property Tax Exemption
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The term "solar incentives" refers to financial incentives that are in place to encourage people to use renewable energy by making the installation and use of solar panels more affordable. These incentives may 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 Arizona and some by your specific utility company, county or municipality. Types of solar incentives might include:
- Tax Exemptions: Your solar system could qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to exclude the value that solar panels add when calculating property taxes on your home.
- Rebates: A solar rebate is a partial refund after the purchase of your solar system. These could be offered by your local utility company, your county or your state. The rebates are usually applied before tax credits are calculated.
- 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.
- Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you've signed a net metering agreement with your Flagstaff utility company, the company will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some places, this credit is dollar-for-dollar, while in other areas you may receive a refund equivalent to a percentage of the value.
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 for Leasing
Sunrun
- Expansive service area
- Many financing options
- Some reported issues with customer service
- Some reported issues with door-to-door sales
Best Social Impact
Palmetto Solar
- Expansive service area
- Makes charitable contributions
- Certified B Corp
- No leases or PPAs
- Quality of installation may vary by location
Federal Solar Incentives
When you hear the term "solar incentives," federal incentives may be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC provides a tax credit for a set percentage of the cost of your solar system.
The ITC can be applied to solar systems installed after January 1, 2006, and under this program you can deduct from your taxes a percentage of the total cost of solar panels, accessories, equipment and labor. This credit can be claimed on solar panels installed on a primary or secondary residence that you own in the United States. The original amount you could claim was 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum claim amount.
Your local Flagstaff solar panel installation expert can provide you with more information about the ITC and how it applies to your situation.
The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. For solar system installations that begin after January 1, 2022, and are completed by the end of 2032, homeowners can apply for a credit equal to 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit expires in 2035. The expansion to the program also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.
Click here to learn more about the new Inflation Reduction Act. To best understand how the new Clean Energy Credit will apply to you, talk to your local Flagstaff solar installation expert.
State & Local Solar Incentives
Some solar incentives may be offered at the local or state level. Like with federal incentives, these can include tax credits, rebates and more. These incentives might be handled by your county or municipality, or by the Arizona government. Certain incentives are available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Flagstaff
The nationwide use of solar energy has gone up tremendously in the last 15 years, in part due to the increase in availability of solar incentives. You may get these incentives from your local utility company, the federal government or the Arizona government. 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 solar panels for your Flagstaff home.
EcoWatch's Flagstaff, AZ Solar Incentives FAQs
How much can I save annually on my electric bill if I add solar panels to my Flagstaff home?
On average, homeowners in Flagstaff who install solar panels save approximately $1,226.83 per year, or approximately $23,309.69 over 20 years after making the switch.
What are the highest-rated solar panel installation companies near me?
To find a top-rated solar panel installer, check out our guide to the top solar companies in Flagstaff.
I want to switch my appliances out for ones that are more energy-efficient. Are there any benefits I can apply for?
The new Inflation Reduction Act creates a variety of new financial incentives for making eco-friendly improvements to your home. More details on these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I use both solar and another type of renewable energy to power my home?
Yes, you can utilize multiple types of renewable energy to power your home — for example, a combination of solar and geothermal. You can also use both renewable energy sources and a backup source of non-renewable energy. You should discuss the details of your plan with your local Flagstaff solar installation expert, to get an understanding of what will be needed and what kinds of incentives 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.