2022 Delaware Solar Incentives, Tax Credits, Rebates (And More)

Here’s a quick look at the solar incentives in Delaware:

  • Federal Solar Tax Credit
  • Delaware Utility Solar Rebate Programs
  • Delaware Net Metering
  • Additional City & Utility Rebates
Ecowatch Author Karsten Neumeister

By Karsten Neumeister, Solar Expert

Updated 5/19/2022

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Our solar experts have sifted through hundreds of local governments’ and utility companies’ websites to find accurate information about current solar incentives in each state. We’ve also unbiasedly ranked and reviewed hundreds of solar installers to empower you to make the right choice for your home.

How Much Can You Save With Solar Incentives in Delaware?

In this article, we’ll discuss the solar incentives and rebates available to Delaware homeowners. When you’re ready to speak with a qualified professional, follow the links below. Each of these companies can help you identify and apply for incentives available in Delaware.

Jump to Section:

  1. Solar Rebates, Tax Credits and Incentive Programs in Delaware
  2. Net Metering in Delaware
  3. Federal Solar Tax Credit
  4. FAQ: Delaware Solar Incentives
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Despite the cost of solar decreasing over the past decade, homeowners in Delaware still pay an average of $24,510 to go solar. This total is based on the average cost per watt for solar equipment — $2.58 throughout the state — and the average system size required to offset the standard energy needs in Delaware — around a 9.5-kW system. This amount is below the national average, but it’s still prohibitively expensive for many Delaware residents.

Thankfully, there are a number of solar incentives available in Delaware from the state and federal governments. Some incentives help to reduce upfront installation costs of solar energy systems, while others aim to entice homeowners to convert. In this guide, we’ll discuss all of the incentives available to Delaware residents and how each one could benefit you.

Disclaimer: This article is for informational purposes only. It should not be relied on for and is not intended to provide accounting, legal or tax advice.

Current Solar Rebates, Tax Credits and Incentive Programs in Delaware

The table below provides a quick snapshot of the most beneficial solar tax credits, incentives and rebates available in Delaware. We’ll provide additional information about each incentive below as well.

Delaware Solar Incentive Description
Federal Solar Tax Credit (ITC) The federal tax credit is made available to all Delaware residents who go solar. It’s a credit that equals 26% of the total cost of your solar system, and it is credited to the federal taxes you owe for the tax year your system is turned on.1 In Delaware, where the average system costs $24,510, the typical credit is approximately $6,373.
Delaware Utility Solar Rebate Programs While Delaware lacks a state tax credit, many utility companies that serve Delaware homeowners provide substantial rebates for going solar. The exact rebate you’re eligible for depends on your electric company, so we’ll provide more information on these rebate programs below.
Net Metering Most residential solar panel systems can send and receive energy to and from the grid via interconnection through your inverter. Net metering allows you to reduce the amount you owe on your energy bills for electricity pulled from the grid by using excess power your system produces.2 We’ll discuss the net metering policy in Delaware in depth below.

Delaware Solar Rebate

Some states have state solar tax credits similar to the federal tax credit to reduce the cost of going solar, but Delaware does not. Instead, the state plans to reach its Renewable Portfolio Standard (RPS) goal by incentivizing property owners to install home solar systems via rebates. Most of the rebates available in Delaware come from public utility companies, and the majority of Delaware residents will be able to take advantage of one of the rebate programs below. 

Delmarva Power Green Energy Program

As the largest utility company in Delaware, Delmarva’s rebate program will be the most widely available throughout the state. This program covers residential solar systems and solar water heaters at a rate of $0.70/W, with a cap of $6,000. That means for every kilowatt Delmarva Power customers install, they’ll be eligible for a rebate of $700. Most Delaware homeowners require a 9.5-kilowatt system, so they’ll be able to capitalize on the full $6,000 rebate. 

The rebate values offered by this program will decrease as it ages, so if you want to take advantage of it, you’ll need to act quickly and get solar installed as soon as possible.

Delaware Electric Cooperative Green Energy Program

The Delaware Electric Cooperative (DEC) provides incentives for photovoltaic equipment, solar thermal, wind, fuel cells and geothermal equipment, provided it’s installed by DEC member-owners. There are varying rebate amounts based on the clean energy source you’re installing, and the cap for PV systems is between $2,500 and $3,500 based on eligibility. In any case, this is a substantial rebate that can reduce your total costs by approximately 10% or more.

Delaware Municipal Electric Cooperative (DEMEC) Green Energy Grants

Finally, the Delaware Municipal Electric Cooperative (DEMEC) offers its Green Energy Grants program to customers. The program includes cash rebates in the amount of $1.00 per watt for the first 5 kilowatts (up to $5,000) and $0.50 per watt thereafter. That means larger solar systems will receive higher rebates, and they also benefit the homeowner by saving them more on energy bills in the long run. As such, this is one of the more appealing solar rebates available in Delaware.

The program also provides rebates for residential solar water heating installations and geothermal heat pump installations.

Other Delaware Solar Incentives

Aside from the solar incentives mentioned above, there are a few additional things to consider that can help you reduce the overall cost of going solar in Delaware.

First, you will have access to Solar Renewable Energy Credits (SRECs). As is the case in many states with Renewable Portfolio Standards (RPS), public utilities are incentivized to make solar power more alluring to their customers. In Delaware, that means offering SRECs, which are credits that homeowners can earn for energy generation. SRECs can be sold on the SREC market for a profit, which means you could ultimately get paid for energy you produce rather than paying your energy bill.

Delaware established its SREC market in 2008, which makes it one of the oldest SREC markets in the nation. However, since the RPS goals set by the state are more than likely being met, the value of SRECs in Delaware is lower than in some other states because utilities are less inclined to buy them to increase the share of renewable energy generation they can claim. It’s unclear what the future holds when it comes to the value of SRECs in Delaware, but it’s still a nice perk you may be able to take advantage of.

Delaware Solar Sales Tax Exemption

Unlike most other states, Delaware does not have sales tax and doesn’t need to offer a specific sales tax exemption like most states do for PV equipment. As such, you won’t pay sales tax on your solar equipment. This can save you more than $1,000 compared to going solar in a state that does have sales tax and doesn’t exempt solar equipment.

Unfortunately, Delaware does not offer a property tax exemption, which is usually provided by states alongside a sales tax exemption. A property tax exemption prevents your property taxes from increasing due to the addition of your solar panel system. In Delaware, your solar panels add to your property value, which increases your assessed value and causes your property taxes to increase as well.

Net Metering in Delaware

Net metering is a billing policy that helps homeowners with solar systems offset their energy bills. Any time you pull energy from the grid, like on cloudy days or at night, you’ll be billed for what you consume. However, you can reduce those charges with any excess energy you provide to the grid when your panels produce more than your home is using, like on sunny days. You only ever pay for your net energy usage.

Delaware has a great net metering program that is hugely beneficial to homeowners throughout the state. The program is available to any taxpayer that generates electricity using solar, wind or hydro systems, anaerobic digesters that produce biogas and even fuel cells capable of being powered by renewable resources.

Best of all, the policy in Delaware states that utilities must offer the full retail rate for excess energy production. That means that your bill will be reduced per kilowatt-hour by the exact cost you pay for the same amount of energy. Some other states allow utilities to reduce the bill based on a sub-retail rate, so this is a huge win for Delawareans.

Local Incentives

In addition to the great net metering policy and the electric utility rebates mentioned above, there is another semi-local incentive that is offered throughout the state but is based on your location within Delaware: the Green Grant Solar Hot Water Program.

This incentive is, unfortunately, only available to non-residential and nonprofit solar customers, but it’s worth mentioning. This program provides a rebate of $1.00 per kWh saved with solar water heating systems for non-residential customers and $1.50 per kWh saved for nonprofit customers. The rebate is capped at $200,000. There are additional rebates available for non-residential and nonprofit customers for geothermal heat pump installation as well.

Federal Solar Tax Credit

One of the most significant solar incentives available to Delaware residents is the federal solar investment tax credit (ITC). This federal government provides this incentive, and it’s available to all Delaware homeowners. The credit is applied to the federal income taxes you owe, and it’s applied for the tax year in which your solar energy system is installed and commissioned. With a credit of 26% of your total cost of going solar, that’s an average of $6,373 in Delaware, where the average cost of solar panels is $24,510. This credit can bring the effective cost of going solar from $24,510 down to a more reasonable $18,137.

The federal tax credit rate will drop to 22% in 2023, which means the value will go from $6,373 to $5,392. Currently, the credit is set to expire for residential systems in 2024, so the credit will no longer be available. That could change if Congress chooses to renew it, but it’s still in your best interest to install solar as soon as possible to take full advantage of the ITC.

Related Topics

FAQ: Delaware Solar Incentives

The EcoWatch team is delighted to get questions about solar installation prices and solar incentives from Delaware homeowners on a daily basis. Below are some of the questions we see most frequently, along with our responses.

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Karsten Neumeister

Solar Expert

Karsten Neumeister is a solar energy specialist with a background in writing and the humanities. Before joining EcoWatch, Karsten worked in the renewable energy sector of New Orleans, focusing on solar energy policy and technology. A lover of music and the outdoors, Karsten might be found rock climbing, canoeing or writing songs when away from the workplace.