2023 Solar Incentives Guide for Covington, KY - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Covington.
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 Covington?
Duke Energy - Residential Efficiency Rebate Program
Central Air Conditioning or Heat Pump: up to $400/unit
Geothermal Heat Pump: $400/unit
Variable Speed Pool Pumps: $300/unit
Attic Insulation and Attic Air Sealing: $250/unit
Duct Sealing: $100/unit
Duct Insulation: $75/unit
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The term "solar incentives" includes a range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Various kinds of incentives, including discounts, cash back or monthly utility bill credits, might be available to you. Certain incentives may be offered by the state of Kentucky, by your utility company or by county or municipality, while other incentives are federal. Some broad categories of solar incentives include:
- Tax Exemptions: Sales tax exemptions are applied at the time of purchase for your solar system. Property tax exemptions let you ignore the added value of your solar system when calculating the amount of property tax you need to pay on your house.
- Rebates: Solar rebates may be offered by your local utility company, or by your county or state. These rebates are essentially partial refunds that are applied after your purchase of a solar system and before tax credits are calculated.
- Net Metering: You can sign a net metering agreement with your Covington utility company, that may apply to all or a percentage of the excess electricity that is generated by your solar panels. Your utility company will then subtract this value from your monthly utility bill.
- Tax Credits: Tax credits decrease, dollar-for-dollar, how much income tax you owe the federal government. These are different from tax deductions.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
Federal Solar Incentives
When thinking about solar incentives, federal incentives might be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is likely the most commonly known federal solar incentive. The ITC allows you to claim a tax credit for a specific percentage of your solar system's cost.
The ITC can be applied to the total cost of installing solar panels, including the panels themselves as well as equipment, labor and accessories. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence that you own and that is located in the United States. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum claim amount.
Speaking with your local Covington solar panel installation expert is the best way to understand how the ITC could apply to you.
The ITC has been renewed and expanded following the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The new Clean Energy Credit now runs until 2035. American homeowners can now apply for a 30% credit for solar systems that began installation on or after January 1, 2022 and will be done by December 31, 2032. The total credit will then decrease annually until it expires. Starting in 2023, the expansion will also make credits for energy storage systems even easier to claim.
Click here to learn more about the new Inflation Reduction Act. Your local Covington solar panel installers are the best people to answer your questions about the new Clean Energy Credit and how it will apply to you.
State & Local Solar Incentives
In addition to those provided at the federal level, there are often also state solar incentives. Tax credits, rebates and more might be available at a more local level. Incentives may be handled by the state of Kentucky, or by your county or municipality. Some incentives might only be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Covington
You can qualify for solar incentives from the Kentucky government and the federal government, as well as from your local utility company. The increased availability of solar initiatives in the past 15 years has helped increase solar adoption nationwide. Reach out to your local solar panel installer today to learn more and to save the most money possible on solar panels for your Covington home.
EcoWatch's Covington, KY Solar Incentives FAQs
How much will solar panels save me annually on my electric bill in Covington?
After adding solar panels to your Covington home, you can expect to save about $673.10 per year, or about $12,788.84 over 20 years.
What are the environmental benefits of switching to solar?
Solar energy is renewable — by switching where you get your energy, you help lessen the strain on our planet's resources. Solar panels can also lower your home's CO2 emissions by 400 pounds annually, or around 8,000 pounds over 20 years.
When does the federal solar tax credit end?
The Clean Energy Credit (formerly called the federal solar tax credit, or the ITC), is scheduled to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
I want to trade in my old appliances for ones that are more energy-efficient. Are there any credits I can apply for?
The new Inflation Reduction Act introduces multiple incentives meant to reward homeowners for making eco-friendly upgrades. Some incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.
Can I use a combination of solar and another type of renewable energy to power my home?
Yes, you can employ multiple types of renewable energy to power your home, such as a combination of solar and geothermal. You can also use both renewable energy sources and a non-renewable backup source of energy. Be sure to discuss the details of your plan with your local Covington solar panel installer, so that you understand what you'll need and what types of incentives you may or may not 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.