2023 Solar Incentives Guide for Valencia West, AZ - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Valencia West.
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 September 15, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Valencia West?
Solar and Wind Equipment Sales Tax Exemption
Residential Solar and Wind Energy Systems Tax Credit
Qualifying Wood Stove Deduction
Energy Equipment Property Tax Exemption
Trico Electric Cooperative - SunWatts Incentive Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives mitigate the cost of installing a solar panel system on your home. Financial incentives like these are designed to encourage more Americans to make the switch to renewable energy. Incentives can include things like discounts, cash back or credit on your utility bill each month. Some incentives are handled federally, while others are handled by the Arizona government or your specific utility company, county or municipality. Categories of solar incentives include:
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
- Net Metering: Net metering is an incentive you can get once your solar system is up and running. If you have a net metering agreement in place with your Valencia West utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some areas, this credit is dollar-for-dollar, while in other places you might receive a refund equivalent to a percentage of the value.
- Rebates: Solar companies may help you claim a rebate, or partial refund after purchase, for your solar panels. Counties or states will also sometimes offer limited-time rebates. The value of a rebate will usually be deducted from the total price before any tax credits are calculated.
- Tax Exemptions: Tax exemptions may come in two forms. The first is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption. This allows you to exclude the value added by your solar system when calculating property tax for your house.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have heard of. The Federal Solar Investment Tax Credit, or ITC, is the most well-known federal solar incentive. The ITC offers a tax credit for a predetermined percentage of the cost of your solar system.
The ITC can be applied to solar systems installed after January 1, 2006 on a primary or secondary residence that you own in the United States. Initially, the credit applied to 30% of the total cost — for panels, accessories, labor and equipment — although it may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the amount you can claim.
Speaking with your local Valencia West solar panel installer is the best way to understand how the ITC could apply 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). Homeowners can now receive a credit of 30% of the total costs of solar system installation for projects started after January 1, 2022 and completed before the end of 2032. The percentage will then decrease yearly until the Clean Energy Credit ends in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems under this new program.
More information about the new Inflation Reduction Act can be found here. Your local Valencia West solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it applies to you.
State & Local Solar Incentives
Rebates, tax credits and more might be provided at multiple levels. Along with federal solar incentives, there are often state and local ones, too. These incentives may be provided by your county or municipality, or by the Arizona government. Certain incentives are ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Valencia West
The large number of available solar incentives has helped tremendously increase the nationwide adoption of solar energy over the last 15 years. You may receive solar incentives from your local utility company, the federal government or the Arizona government. Your local Valencia West solar panel installer can help you learn more about which incentives you should apply for, and get you on track to switch to renewable energy today.
EcoWatch's Valencia West, AZ Solar Incentives FAQs
My home already has solar panels installed. Do I qualify for any incentives?
An excellent idea would be to talk to a representative from the company that installed your solar system — or reach out to a local Valencia West solar installer — to better understand which incentives you might qualify for. If your system was installed after January 1, 2022, you likely qualify for the recently increased 30% tax credit under the Inflation Reduction Act. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
What are the best solar panel installation companies near me?
To discover the best solar panel installation companies near you, read our article on Valencia West's best solar panel companies.
What are some environmental benefits of adding solar panels to my house?
You can reduce your carbon footprint by 500 pounds of CO2 annually by switching to solar panels. This adds up to roughly 11,000 pounds in 20 years. Solar is also a renewable energy source, which means that switching your home over reduces the drain on our planet's resources.
I want to trade in my old appliances for ones that are more energy-efficient. Are there any incentives I can apply for?
With the passage of the new Inflation Reduction Act, there are a number of new financial incentives that are available when you make eco-friendly improvements to your home. More details regarding these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I receive incentives both towards the up-front cost of solar panels, and later as reimbursement?
Yes, you can receive both rebates and tax credits towards the cost of your solar panels. Depending on precisely which incentives you are eligible for, they may apply in a different order. Be sure to talk to your solar installer or a local tax professional to ensure that you are claiming incentives correctly and that you're getting the most money possible.
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.