2023 Solar Incentives Guide for Florence, CO - Tax Credits & Rebates

What Solar Tax Credits, Incentives, and Rebates are Available in Florence?

Source: https://www.dsireusa.org/

Solar incentives are intended to make renewable energy usage more affordable via financial incentives for those who install solar panels on their homes. Solar incentives could include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are handled by the federal government, some by the Colorado government and some by your specific utility company, county or municipality. Some broad categories of solar incentives include:

• Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the federal government.
• Net Metering: Net metering becomes relevant once your solar system is up and running. If you have a net metering agreement with your Florence utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some areas, this is a dollar-for-dollar credit, while in other places you might be refunded a percentage of the value.
• Rebates: Rebates, or cash back after a purchase, are normally applied prior to any solar tax credits being calculated. These rebates may be provided by your local utility company, by your county or by your state.
• Tax Exemptions: Sales tax exemptions are applied at the point of sale for your solar panels. Property tax exemptions allow you to ignore the value added by your solar system when you calculate the amount of property tax you need to pay on your home.

Federal Solar Incentives

When you think about solar incentives, you likely think of federal incentives first. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit equal to a predetermined percentage of the money you spend on solar panels for your home.

The ITC applies to solar systems installed after January 1, 2006 on a primary or secondary residence in the United States that you own. Originally, the tax credit was for 30% of the total cost — for panels, equipment, labor and accessories — although it may range from 26-30%, depending on when your solar system was installed. There is no cap on the claim amount.

To find out exactly how much money the ITC could save you, contact your local Florence solar panel installation expert.

The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as retitling it 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 credit percentage will then decrease on a yearly basis until the Clean Energy Credit ends in 2035. The expansion to the program also makes credits for energy storage systems even easier to claim, beginning in 2023.

Click here to learn more about the new Inflation Reduction Act. The easiest way to learn more about how the new Clean Energy Credit might apply to you is to talk with your local Florence solar panel installers.

State & Local Solar Incentives

Some solar incentives may be provided at the state and local level. Like with federal incentives, these may include rebates, tax credits and more. These solar incentives — which may be handled by your county or municipality, or by the state of Colorado — might be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Florence

Solar incentives may be provided by the federal government, the Colorado government or your local utility company. The growing number of available incentives has facilitated the nationwide growth of solar energy use in the last 15 years. If you're prepared to switch over to solar energy, calling your local Florence solar panel installation expert is an excellent place to start.