2025 Solar Incentives Guide for Cedar Rapids, IA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Cedar Rapids.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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What Solar Tax Credits, Incentives, and Rebates are Available in Cedar Rapids?
Property Tax Exemption for Renewable Energy Systems
Renewable Energy Equipment Exemption
Solar Energy Systems Tax Credit (Personal)
Local Option - Special Assessment of Wind Energy Devices
Methane Gas Conversion Property Tax Exemption
Geothermal Heat Pump Tax Credit
Energy Replacement Generation Tax Exemption
Reduced rate for large hydro
Linn County Rural Electric Cooperative - Residential Energy Efficiency Rebate Program
Premier Electric Home (New Construction): $200/home
Heat Pump Water Heater: $650/unit
High Efficiency Electric Water Heater: $75-$150/unit
Drain Water Heat Recovery Systems: $450/unit
Clothes Washer: $40/unit
Clothes Dryer: $20/unit
Interior Lighting: $5/fixture
Outdoor Lighting: $10-$60/fixture
Geothermal Heat Pump: $150-$400/ton
Air Source Heat Pump: $200-$300/ton plus $250 bonus
Central A/C: $100
Heat Recovery Ventilator: $250/unit
Alliant Energy Interstate Power and Light - Residential Energy Efficiency Rebate Programs
Air Source Heat Pump: $300-$800 for existing homes, $180-$480 for new homes
Appliance Recycling: up to $50
Central A/C: $150-$600 for existing homes, $90-$360 for new homes
Ductless Mini-Split Heat Pump: Varies
Electric Heat Pump Water Heater: $300-$350 for existing homes, $180-$210 for new homes
Electric HVAC System Tune-Up: up to $50
Gas Furnace: $180 for existing homes, $80 for new homes
Geothermal Heat Pump: $1,320-$1,750 for existing homes, $790-$1,050 for new homes
Learning Thermostat: $100 for existing homes, $60 for new homes
LED Light Bulbs: In-Store Rebates
Online Home Energy Assessment: FREE
Room Air Purifier: up to $30
Variable Speed Pool Pumps: up to $220
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are intended to make renewable energy usage more affordable via financial incentives for individuals who install solar panels on their homes. The incentives may include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are handled by the federal government, some by the state of Iowa and some by your specific utility company, county or municipality. Categories of solar incentives include:
- Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you have a net metering agreement with your Cedar Rapids utility company, the company will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in others you may receive a refund equivalent to a percentage of the value.
- Tax Exemptions: These can come in the form of property tax exemptions, which allow you to exclude the value added by your solar panels when paying property tax on your house. They may also include exemptions on sales tax at the time of purchase.
- Rebates: Rebates, or partial refunds after a purchase, are normally applied prior to any solar tax credits being calculated. These rebates might be given by your local utility company, by your county or by your state.
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
Federal Solar Incentives
Federal solar incentives are likely the first thing that comes to mind when thinking about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is likely the best-known federal solar incentive. The ITC offers a tax credit for a predetermined percentage of your solar system's cost.
The ITC can be applied to solar systems installed after January 1, 2006, and lets you deduct from your taxes a percentage of the total cost of solar panels, labor, equipment and accessories. This credit can apply towards a solar panel system installed on a primary or secondary residence that you own in the United States. Originally, you could claim 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum claim amount.
To know exactly how much the ITC could save you, talk to your local Cedar Rapids solar panel installation expert.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now dubbed the Clean Energy Credit. The new Clean Energy Credit is valid until 2035. You can now receive a 30% credit for solar systems installed between January 1, 2022, and December 31, 2032. This new credit will then be decreased by a few percentage points every year until it expires. The expansion to the program 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. Your local Cedar Rapids solar panel installation expert is the best person to answer your questions about the new Clean Energy Credit and how it applies to you.
State & Local Solar Incentives
Some solar incentives may be provided at the state and local level. As with federal incentives, these might include rebates, tax credits and more. Incentives may be handled by your county or municipality, or by the state of Iowa. Some incentives may be available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Cedar Rapids
The large number of solar incentives available has enormously increased the use of solar power nationwide over the last 15 years. You might qualify for solar incentives from your local utility company, the Iowa government or the federal government. Getting in touch with your local Cedar Rapids solar panel installation company is an excellent first step towards making sure you get all the incentives you qualify for when you switch to solar energy.
EcoWatch's Cedar Rapids, IA Solar Incentives FAQs
How much can I save annually on my electric bill if I install solar panels on my house in Cedar Rapids?
On average, homeowners in Cedar Rapids who install solar panels save about $1,000.10 per year, or about $19,001.99 over 20 years after making the switch.
Who installs solar panel systems near me?
To find the top solar panel installers near you, read our article on the top solar companies in Cedar Rapids.
I want to switch my appliances out for ones that are more energy-efficient. Are there any benefits I can claim?
The new Inflation Reduction Act creates a number of new financial incentives to encourage you to make eco-friendly improvements to your home. More details on these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I use a combination of multiple types of renewable energy to power my home?
You can power your home with multiple types of renewable energy, or a combination of renewable and non-renewable energy. Be sure to discuss your plan with your local Cedar Rapids solar installer. They can help you with the plan for your project and educate you on the various incentives that you will or won't qualify for.
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.