2024 Solar Incentives Guide for Somerset, KY - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Somerset.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Somerset?
Jackson Energy Cooperative - Residential Energy Efficiency Rebate Programs
CARES Program: Up to $2,000/household
South Kentucky RECC - Residential Energy Efficiency Rebate Program
Touchstone Energy Home: Varies, contact energy advisor for details
Resistant Heat to Heat Pump: $250-$750
Energy Audits: FREE
SimpleSaver: up to $20 in bill credits annually for each air conditioner enrolled
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The term "solar incentives" refers broadly to financial incentives put in place by solar companies and the government to encourage the adoption and use renewable energy by making installing and using solar panels more affordable. You might qualify for different kinds of incentives, such as cash back, discounts or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the Kentucky government and others from the federal government. Types of solar incentives might include:
- Net Metering: Net metering is an incentive you can get once your solar panels are up and running. If you have a net metering agreement with your Somerset utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some areas, this is a dollar-for-dollar credit, while in other places you might make back a percentage of the value.
- Tax Credits: Tax credits lower, dollar-for-dollar, the amount of income tax you owe the government. Tax credits differ from tax deductions.
- Tax Exemptions: Sales tax exemptions are effective at the time of purchase for your solar system. Property tax exemptions allow you to ignore the added value of your solar system when you're calculating how much property tax you need to pay.
- Rebates: Rebates, or partial refunds after a purchase, are usually applied prior to any solar tax credits being calculated. Rebates might be provided by your local utility company, by your county or by your state.
Best National Provider
SunPower
- Most efficient panels on the market
- National coverage
- Cradle to Cradle sustainability certification
- Great warranty coverage
- Expensive
- Customer service varies by local dealer
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 may be the first thing that comes to mind. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit that reduces your taxes by a specified percentage of the money you spend on your solar system.
The ITC can be applied to solar systems installed after January 1, 2006, on a primary or secondary residence that you own in the United States. The credit initially covered 30% of the total cost – for panels, equipment, accessories and labor – although that amount may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the amount you can claim.
Talking to your local Somerset solar panel installer is the best way to learn more about how the ITC could apply to you.
The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as retitling it the Clean Energy Credit). The new Clean Energy Credit extends until 2035. You can now apply for a 30% credit for solar systems installed between 2022 and 2032. This credit will then be decreased by a few percentage points every year until the date of expiration. The expansion also makes it easier to get credit for energy storage systems, starting in 2023.
More information about the new Inflation Reduction Act can be found here. Your local Somerset solar panel installation expert is the best person to answer your questions regarding the new Clean Energy Credit and how it will apply to you.
State & Local Solar Incentives
Some solar incentives may be offered at the local or state level. Like with federal incentives, these might include tax credits, rebates and more. These incentives might be given out by your county or municipality, or by the Kentucky government. Some are ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Somerset
There are a number of different solar incentives: those offered by local utility companies, those given by the Kentucky government and those provided by the federal government, to name a few. Solar energy utilization has increased enormously in the last 15 years, thanks to these incentives. If you're prepared to make the change to solar energy, talking to your local Somerset solar panel installation expert is an excellent place to start.
EcoWatch's Somerset, KY Solar Incentives FAQs
I already have solar panels installed. Do I qualify for any incentives?
If your solar system was installed after January 1, 2022, you may qualify for the newly increased 30% tax credit under the Inflation Reduction Act. If your system was installed between 2006 and 2021, you might qualify for a tax credit between 26% and 30%, depending on the exact installation date. Reaching out to the company that installed your solar system, or any local Somerset solar installer, can help you learn what incentives you can apply for.
How long until the federal solar tax credit ends?
The Clean Energy Credit (formerly called the federal solar tax credit, or the ITC), currently ends on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I claim incentives both towards the up-front cost of solar panels, and later as reimbursement?
Yes, you can claim both rebates and tax credits towards the cost of solar panels. Depending on precisely which incentives you are receiving, they may apply in a different order. Make sure that you speak with your solar installer or a local tax professional to ensure that you are claiming the correct incentives and getting the most money you can.
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 ideas with your local Somerset solar installer. They can help you plan your project and also help you understand 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.