2023 Solar Incentives Guide for Colchester, CT - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Colchester.
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 Colchester?
Local Option - Property Tax Exemption for Renewable Energy Systems
Property Tax Exemption for Renewable Energy Systems
Sales and Use Tax Exemption for Solar and Geothermal Systems
Residential Solar Investment Program
Up to 10 kW PTC: $0.358/W
10 to 20 kW PTC: $0.207/W
Incentive is reduced accordingly for Design Factors below 75%. Minimum design factor is 60%.
Third-Party-Owned (PBI):
Up to 20 kW PTC: $0.03/kWh for 6 years
Minimum Design Factor 60%
Connecticut Green Energy Building Solutions
Smart-E loans
Sales and Use Tax Exemption for Energy-Efficient Products
Energy Conservation Loan
Landlord Loan: $40,000
The United Illuminating Company - Small ZREC Tariff
Eversource - Small ZREC Tariff
(Electric and Gas) Residential Rebate Program
Refrigerators/Freezers, Room A/Cs, Dishwashers, Clothes Washers, Dehumidifiers: Incentive Included in Retail Price
Central A/C: $200
Air Source Heat Pumps: $500
Heat Pump Water Heater: $750
Lighting: Incentive Included in Retail Price
Geothermal Heat Pumps: $500-$1,500
High Efficiency Furnace, Natural Gas Boiler, and Boiler Circulator Pump: Instant Discounts of $25-$800
Local Option - Residential Sustainable Energy Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives help mitigate the cost of installing a solar panel system on your home. Financial incentives like these are in place to encourage more people to convert their home partially or fully to renewable energy. Incentives can include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are provided by the federal government, while others are provided by the state of Connecticut or your specific utility company, county or municipality. Types of solar incentives might include:
- Rebates: A solar rebate is a partial refund given after you've purchased your solar panels. Rebates may be offered by your local utility company, your county or your state. The rebates are usually applied before tax credits are calculated.
- Net Metering: Net metering factors in after your solar system is up and running. If you've signed a net metering agreement with your Colchester utility company, it will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some places, this is a dollar-for-dollar credit, while in others you may get refunded a percentage of the value.
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
- Tax Exemptions: These might come in the form of property tax exemptions, which allow you to exclude the value of your solar system when paying property tax on your home. You could also look for exemptions on sales tax at the time of purchase.
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Federal Solar Incentives
Federal solar incentives are likely the first thing that comes to mind when you think about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is probably the most commonly known federal solar incentive. The ITC allows you to claim a tax credit for a set percentage of your solar system's cost.
The ITC is applied to the total cost of installing a solar system, including the panels themselves as well as labor, accessories and equipment. You can claim this credit for panels installed after January 1, 2006 on a primary or secondary residence that you own, as long as it is located in the United States. The tax credit ranges from 26-30% of total costs depending on when your project was completed. There is no maximum claim amount.
Have questions about how the ITC applies to your specific situation? Contact your local Colchester solar panel installer to get more information.
The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as retitling it 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 for 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit expires in 2035. Starting in 2023, it will also be easier to get credits for energy storage systems under the new laws.
More information about the new Inflation Reduction Act can be found here. The best way to fully understand how the new Clean Energy Credit will apply to you is to reach out to your local Colchester solar panel company with your questions.
State & Local Solar Incentives
Some solar incentives are often also provided by state and local governments. As with federal incentives, these might include rebates, tax credits and more. Incentives might be given by your county or municipality, or by the state of Connecticut. Certain incentives are available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Colchester
Solar incentives might come from your local utlity company, the Connecticut government or the federal government. The growing number of available solar incentives has facilitated the nationwide growth of solar energy use in the last 15 years. Your local Colchester solar panel installation expert can give you more information about which incentives you may qualify for, and get you feeling good about making the change to renewable energy today.
EcoWatch's Colchester, CT Solar Incentives FAQs
Can I receive any incentives when I add solar panels to a rental property, vacation home or commercial property?
Many solar incentives are intended to apply to a property you own that is located within the United States, and most secondary residences will fall under this distinction. Other solar incentives may be available for commercial properties, depending on the details. We recommend talking to your local solar installer and/or tax professional to best understand what incentives may apply to your specific situation.
How can I learn if I qualify for different solar incentives?
It's best to speak with your local Colchester solar installer for a better understanding of which incentives your project will qualify for. Generally, solar incentives apply to new solar panel systems installed on 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 Connecticut government, may have other requirements.
What are the best solar panel installation companies near me?
To find the right solar panel installer for you, check out our guide to the best solar companies in Colchester.
How long until the federal solar tax credit ends?
The federal solar tax credit, formerly known as the ITC and now named the Clean Energy Credit, is scheduled to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
If I switch my appliances out for ones that utilize solar energy, are there credits I can claim?
With the passage of the new Inflation Reduction Act, there are several new financial incentives that are available when you make eco-friendly improvements to your home. More details on these incentives, including information about incentives for purchasing new appliances, can be found here.
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.