2023 Solar Incentives Guide for Peoria, AZ - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Peoria.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Peoria?
Solar and Wind Equipment Sales Tax Exemption
Residential Solar and Wind Energy Systems Tax Credit
Qualifying Wood Stove Deduction
Energy Equipment Property Tax Exemption
SRP - Solar Water Heating Program
Federal Residential Renewable Energy Tax Credit
Solar incentives are intended to make renewable energy usage more affordable through financial incentives to help people install solar panels on their homes. You might qualify for several types of incentives, including discounts, cash back or monthly utility bill credits, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of Arizona and others from the federal government. Some broad categories of solar incentives include:
- Tax Exemptions: Tax exemptions can come in two forms. First, there is sales tax exemption, applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when calculating property tax for your house.
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government. (This is different from a tax deduction.)
- Net Metering: You can sign a net metering contract with your Peoria utility company, that may apply to all or a percentage of the excess electricity your solar panels generate. They will then subtract this value from your utility bill each month.
- Rebates: A solar rebate is a partial refund after the purchase of your solar system. Rebates may 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 tax credits are calculated.
Federal Solar Incentives
When people think of solar incentives, federal incentives may be the first thing that comes to mind. One of the incentives that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a specific 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, equipment, labor and accessories. You can claim this credit for solar panels installed on a primary or secondary residence in the United States that you own. The original claim amount was 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum claim amount.
To best understand how the ITC will apply to you, speak to your local Peoria solar panel installation expert and request more information.
The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as renaming it to the Clean Energy Credit). The Clean Energy Credit has increased the current credit up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. After this, the credit percentage will see a slight decrease annually until the program expires in 2035. The expansion also makes it easier to get credit for energy storage systems, beginning in 2023.
Click here to learn more about the new Inflation Reduction Act. To fully understand how the new Clean Energy Credit applies to you, talk to your local Peoria solar installation company.
State & Local Solar Incentives
Not all solar incentives are federal; tax credits, rebates and more might also be offered at the local or state level. Certain incentives are ongoing, while others may only be available for a limited time. Incentives may be given by your county or municipality, or by the Arizona government.
Next Steps for Installing Solar in Peoria
Solar incentives may come from your local utility company, the federal government or the Arizona government. The variety of incentives available has contributed to a large increase in solar energy use in the last 15 years. Speaking with your local Peoria solar panel installation expert is an excellent first step towards making sure you get all the incentives you qualify for when you switch to solar energy.
EcoWatch's Peoria, AZ Solar Incentives FAQs
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.