2025 Solar Incentives Guide for Wilmington, DE - Tax Credits & Rebates

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

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

Solar incentives are intended to encourage people to switch their home over to renewable energy by offering incentives meant to lower the financial burden of solar panel installation and use. You may be eligible for various types of incentives, including cash back, discounts or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of Delaware and others from the federal government. Some solar incentives you might qualify for are:

• Net Metering: Be sure to talk to your Wilmington utility company about signing a net metering contract. This allows you to receive credit towards your utility bill every month for the value of excess energy your solar panels generate. You might receive either a dollar-for-dollar credit or a percentage of the value.
• Rebates: Solar rebates may be offered by your local utility company, or by your state or county. These rebates are essentially partial refunds that are applied after you pay for solar panels and before tax credits are calculated.
• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are typically handled by your state government. Once your solar panel system meets the qualification threshold (typically a small amount of energy production), you are eligible to receive SRECs that can then be sold to your utility company or other buyers. The money you receive is usually considered part of your taxable income.
• Tax Credits: Tax credits reduce, dollar-for-dollar, the amount of income tax you owe the government. Tax credits differ from tax deductions.
• Tax Exemptions: Tax exemptions can come in two forms. First, there is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption. This allows you to ignore the added value of your solar system when paying property tax on your house.

Federal Solar Incentives

When people think of solar incentives, federal incentives may be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is the best-known federal solar incentive. The ITC provides you with a tax credit for a set percentage of your solar system's cost.

The ITC applies to solar panels installed on your primary or secondary residence in the United States. The solar panels have to have been installed on a property you own after January 1, 2006, for you to claim the credit. Originally, the ITC covered 30% of all costs (panels, accessories, labor and equipment), although the total amount has fluctuated over the last few years between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the claim amount.

To know exactly how much money the ITC could save you, contact your local Wilmington solar panel installer.

In August 2022, the Inflation Reduction Act expanded and extended the ITC, now called the Clean Energy Credit. Now, solar installation projects begun after January 1, 2022, and finished by December 31, 2032, may be eligible for a 30% tax credit. This percentage will then see a slight annual decrease until the current Clean Energy Credit expires in 2035. The expansion also makes claiming credit for energy storage systems easier than ever before, starting in 2023.

More information about the new Inflation Reduction Act can be found here. The best way to understand how the new Clean Energy Credit applies to you is to get in touch with your local Wilmington solar panel installation expert.

State & Local Solar Incentives

Tax credits, rebates and more can be claimed at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. Certain incentives are ongoing, while others are offered for only a limited time. Your local solar incentives might come from the Delaware government, or from your specific county or municipality.

Next Steps for Installing Solar in Wilmington

There are many types of solar incentives: those given by local utility companies, those provided by the federal government and those provided by the Delaware government, to name a few. Solar energy use has increased enormously in the last 15 years, partially due to these incentives. Your local Wilmington solar panel installation expert can give you more information about which incentives you can apply for, and get you started on the path to switching to renewable energy today.