2023 Solar Incentives Guide for Covington, LA - 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?
Home Energy Loan Program (HELP)
New Orleans City - Energy Smart Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are meant to encourage homeowners to make the switch to renewable energy by providing incentives that lower the financial burden of solar panel installation and use. Various kinds of incentives, such as cash back, discounts or credit towards your monthly utility bill, may be available to you. Some incentives may be offered by the Louisiana government, by your utility company or by county or municipality, while other incentives are federal. Some solar incentives you might qualify for are:
- Tax Exemptions: Tax exemptions can come in two forms. First, there is sales tax exemption, which is applied at the time you purchase your 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.
- Rebates: Your solar installer might help you claim a rebate, or partial refund of your purchase, for your solar system. Counties or states will also offer limited-time rebates at various times. If you receive a rebate, that amount will usually be deducted from your total price before tax credits are calculated.
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
- Net Metering: Make sure you talk to your Covington utility company about signing a net metering agreement. This will allow you to get a 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.
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Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have heard of. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a certain percentage of your solar system's cost.
The ITC originally covered 30% of the cost of installing solar panels, although that number has fluctuated slightly over the last few years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The cost of installation includes the panels themselves as well as the cost of labor, equipment and accessories. There is no maximum amount you can claim. The ITC applies to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.
To more fully understand how the ITC could apply to your situation, reach out to your local Covington solar panel installation expert and request more information.
In August 2022, the ITC (now titled the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners can receive a credit equal to 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit ends in 2035. Beginning in 2023, it will also be easier to get credits for energy storage systems under the new laws.
Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit might apply to you, talk to your local Covington solar installation company.
State & Local Solar Incentives
In addition to federal solar incentives, there are often also state ones. Tax credits, rebates and more can be offered at a more local level. Some incentives are ongoing, while others are available for a limited time. They might be given by your county or municipality, or by the Louisiana government.
Next Steps for Installing Solar in Covington
You can receive solar incentives from the federal government and the Louisiana 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. Getting in touch with your local Covington solar panel installer is an excellent first step towards getting all the incentives you qualify for when you switch to solar energy.
EcoWatch's Covington, LA Solar Incentives FAQs
How can I learn if I qualify for solar incentives?
It's a good idea to talk to your local Covington solar installer to get an understanding of which incentives your project may qualify for. Typically, solar incentives apply to new solar systems installed on property you own (in the U.S.) between the dates specified by the incentive. Some incentives, like those offered by the government of Louisiana, may have other requirements.
How much can I save on my electric bill annually if I add solar panels to my Covington home?
Typically, homeowners in Covington who install solar panels save around $897.68 per year, or around $17,055.86 over 20 years after making the switch.
Who installs solar panels near me?
To discover the top solar panel installers near you, read our article on the top solar companies in Covington.
When does the federal solar tax credit end?
The Clean Energy Credit (previously called the federal solar tax credit, or ITC), is slated to end 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 initial cost of solar panels, and later as reimbursement?
The order that incentives will be applied in might vary depending on which incentives you are claiming but generally yes, you can claim multiple types of incentives for your solar project. Get in touch with your solar installer or a local tax professional to verify you are claiming all possible incentives and applying them in the correct order.
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.