2023 Solar Incentives Guide for Chelmsford, MA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Chelmsford.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Chelmsford?
Renewable Energy Property Tax Exemption
Wind, hydroelectric, geothermal, solar thermal, solar PV, and other solar energy systems: the assessed value of the system
Residential Renewable Energy Income Tax Credit
Renewable Energy Equipment Sales Tax Exemption
Alternative Energy and Energy Conservation Patent Income Tax Deduction (Personal)
Cape Light Compact- Residential Energy Efficiency Rebate Program
Refrigerator and Freezer Recycling: $125
Electric Clothes Dryers: $50
Clothes Washer: $350
Room Air Purifiers: $40
Room Air Conditioner: $40
Heating & Cooling
Oil Heating System: Up to $800
Propane Heating Equipment: Up to $2,300
Oil Water Heater: Up to $400
Propane Water Heater: Up to $800
Heat Pump Water Heater: Up to $600
Central AC/Heat Pump: Up to $250/ton
Mini-Split Heat Pump: Up to $250/ton
Programmable Thermostats: Up to $25
WiFi Thermostat: Up to $100
Solar Domestic Hot Water heater: $500 - $1,500
Advanced Power Strips: Varies
Limited Time Enhanced Incentive: 75%
Year-Round Tenant Incentive: 100%
Enhanced Residential Program: 100%
Home Energy Assessment: Free
Mass Save - HEAT Loan Program
Solar Massachusetts Renewable Target (SMART) Program
Mass Solar Loan Program
Residential and Small-Scale Ground-Source Heat Pump Rebate Program
Retrofit Existing GSHP Rebate: varies with installation costs
Commonwealth Woodstove Change-Out Program
Pellet Stove: $1,000 - $1,750
Catalytic Woodstove: $750 - $1,250
Non-Catalytic Woodstove: $500-$1,250
Fully Automated Wood Stove: $1,500 - $1,750
Pellet Stove: $2,500 - $3,250
Catalytic Woodstove: $2,250 - $2,750
Non-Catalytic Woodstove: $2,000-$2,750
Fully Automated Wood Stove: $2,750 - $3,250
Local Option - Energy Revolving Loan Fund
Solar Renewable Energy Certificates (SREC-II)
Federal Residential Renewable Energy Tax Credit
Solar incentives help mitigate the cost of installing a solar panel system on your home. Financial incentives like these are designed to encourage more Americans to switch their home over to renewable energy. Different types of incentives, like cash back, discounts or credit towards your monthly utility bill, might be available to you. Certain incentives may be handled by the Massachusetts government, by your utility company or by county or municipality, while others are federal. Some broad categories of solar incentives include:
- Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives may be available to you if you have a solar system that produces more than a specified (typically small) amount of electricity. This category of incentives is generally handled by the state government. You can sell your SRECs to your utility company or other buyers, and the money you receive in return is usually considered part of your taxable income.
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the federal government.
- Tax Exemptions: These could come in the form of property tax exemptions, which can let you ignore the value of your solar system when paying taxes on your home. They may also include exemptions on sales tax at the time of purchase.
- Net Metering: Net metering becomes relevant once your solar system is up and running. If you've signed a net metering agreement with your Chelmsford utility company, it will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some areas, this credit is dollar-for-dollar, while in other places you might make back a percentage of the value.
- Rebates: Solar rebates might be offered by your local utility company, or by your state or county. These rebates work as cash back that is applied after you pay for a solar system and before tax credits are calculated.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some knowledge of. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit that reduces your taxes by a specified percentage of the money you spend installing solar panels.
The ITC originally covered 30% of the cost of solar system installation, although it 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 total installation cost includes the panels themselves as well as the cost of labor, accessories and equipment. There is no maximum claim amount. The ITC can be applied 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.
Your local Chelmsford solar panel installer can provide more information about the ITC and how it might apply to your situation.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now called the Clean Energy Credit. Homeowners can now receive a credit equal to 30% of the total costs of solar system installation for projects that began after January 1, 2022 and will be finished by the end of 2032. The credit percentage will then begin to decrease yearly until the Clean Energy Credit ends in 2035. Starting in 2023, the program expansion will also make claiming credit for energy storage systems easier than ever before.
More information about the new Inflation Reduction Act can be found here. Your local Chelmsford solar panel company can answer any questions you have and explain how the new Clean Energy Credit applies to you.
State & Local Solar Incentives
Not all solar incentives are federal; tax credits, rebates and more are often offered at the local or state level. Incentives might be given by your county or municipality, or by the state of Massachusetts. Certain incentives might only be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Chelmsford
There are a variety of solar incentives: those offered by local utility companies, those offered by the federal government and those offered by the Massachusetts government, to name a few. Solar energy use has grown enormously in the last 15 years, thanks to these incentives. Speak with your local solar panel installation expert today to learn more and to save the most money possible on solar panels for your Chelmsford home.
EcoWatch's Chelmsford, MA Solar Incentives FAQs
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