2025 Solar Incentives Guide for Dracut, MA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Dracut.
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 Dracut?
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
Dehumidifiers: $30
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
Home Electronics
Advanced Power Strips: Varies
Home Insulation
Limited Time Enhanced Incentive: 75%
Year-Round Tenant Incentive: 100%
Enhanced Residential Program: 100%
Lighting
LEDs: Varies
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
Low-Income Residential:
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
Source: https://www.dsireusa.org/
Solar incentives mitigate the cost of installing a solar panel system on your home. Financial incentives like these are in place to encourage more people to convert their home partially or fully to renewable energy. Various types of incentives, such as cash back, discounts or credit towards your monthly utility bill, might be available to you. Some incentives may be offered by the state of Massachusetts, by your utility company or by county or municipality, while others are federal. Categories of solar incentives include:
- Tax Credits: Tax credits reduce, dollar-for-dollar, how much income tax you owe the federal government. Tax credits differ from tax deductions.
- 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 Dracut utility company, the company will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some locations, this is a dollar-for-dollar credit, while in other areas you might receive a refund equivalent to a percentage of the value.
- Solar Renewable Energy Certificate (SREC): In most cases, solar systems that produce over a specific (usually small) amount of electricity can qualify for SRECs or other performance-based incentives. SRECs and similar incentives are typically provided at the state level. When you receive an SREC, you can sell it to your utility company or another buyer, and this is usually considered part of your taxable income.
- Tax Exemptions: These may come in the form of property tax exemptions, which can let you exclude the value of your solar system when paying property tax on your house. They may also include exemptions on sales tax at the time of purchase.
- Rebates: Rebates, or cash back after a purchase, are usually given before any solar tax credits are calculated. Rebates may be given by your local utility company, by your county or by your state.
Federal Solar Incentives
Federal solar incentives are likely to be the first thing that you think of when you think about solar incentives. An incentive that most people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a predetermined percentage of your solar system's cost.
The ITC can be applied to the total cost of solar system installation, including the panels themselves as well as equipment, accessories and labor. You can claim this credit for panels installed after January 1, 2006, on a primary or secondary residence located in the United States that you own. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum claim amount.
To best understand how the ITC could apply to your situation, speak to your local Dracut solar panel installer and ask for more information.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as retitling it the Clean Energy Credit). The new Clean Energy Credit is valid until 2035. Homeowners are now eligible for a 30% credit for solar systems installed between 2022 and 2032. This new credit will then see a slight annual decrease until its expiration. Starting in 2023, the 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. To understand how the new Clean Energy Credit applies to you, reach out to your local Dracut solar installation expert.
State & Local Solar Incentives
Tax credits, rebates and more might be claimed at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. These incentives might be provided by your county or municipality, or by the Massachusetts government. Some incentives may be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Dracut
There are a variety of solar incentives: those given by local utility companies, those given by the federal government and those provided by the Massachusetts government, to name a few. The use of solar energy has grown enormously in the last 15 years, thanks to these incentives. Your local Dracut solar panel installation expert can provide you with more details about which incentives you can apply for, and get you started on the path to switching to renewable energy today.
EcoWatch's Dracut, MA Solar Incentives FAQs
How do I know if I qualify for specific solar incentives?
It's a good idea to talk to your local Dracut solar installer to get an understanding of which incentives your project will qualify for. Usually, solar incentives apply to new solar systems installed on a property you own (in the U.S.) within a specified date range. Some incentives, such as those given by the state of Massachusetts, might have additional requirements.
How much can I save annually on my electric bill if I install solar panels on my house in Dracut?
On average, homeowners in Dracut who install solar panels save around $1,162.67 per year, or about $22,090.75 over 20 years after they make the switch.
When does the federal solar tax credit end?
The Clean Energy Credit (formerly called the federal solar tax credit, or the 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.
If I change out my appliances for ones that can use solar energy, are there credits I can claim?
The recently passed Inflation Reduction Act introduces a number of incentives designed to reward homeowners who make eco-friendly upgrades. Some of these incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
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