2024 Solar Incentives Guide for Lawrence, MA - Tax Credits & Rebates

What Solar Tax Credits, Incentives, and Rebates are Available in Lawrence?

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Solar incentives are intended to encourage people to make the switch to renewable energy by offering financial incentives meant to lower the burden of solar panel installation and use. Various types of incentives, including cash back, discounts or credit towards your monthly utility bill, might be available to you. Certain incentives may be provided via the state of Massachusetts, by your utility company or by county or municipality, while others are federal. Types of solar incentives might include:

• Net Metering: Net metering becomes relevant after your solar panels are up and running. If you've signed a net metering agreement with your Lawrence utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in other places you may receive a refund equivalent to a percentage of the value.
• Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce over a threshold (usually small) amount of electricity will qualify for SRECs or other performance-based incentives. SRECs and performance-based incentives in general are typically given at the state level. When you receive an SREC, you can sell it to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.
• Rebates: Rebates, or cash back after a purchase, are typically given prior to any solar tax credits being calculated. These rebates may be offered by your local utility company, by your state or by your county.
• Tax Exemptions: Your solar system could qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions let you ignore the added value of the solar panels when you are calculating property taxes on your house.
• Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the federal government.

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Federal Solar Incentives

When thinking about solar incentives, you probably think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is probably the best-known federal solar incentive. The ITC offers a tax credit for a specific percentage of the cost of your solar system.

The ITC is applied to the total cost of solar system installation, including the panels themselves as well as accessories, labor and equipment. This credit can be claimed for panels installed after January 1, 2006, on a primary or secondary residence located in the United States that you own. 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 amount you can claim.

To better understand how the ITC could apply to your situation, contact your local Lawrence solar panel installer and ask for more information.

The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. Homeowners can now receive a credit equal to 30% of the total solar system installation costs for projects started after January 1, 2022, and completed before the end of 2032. The percentage will then decrease yearly until the Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to obtain credits for energy storage systems with the new act.

More information about the new Inflation Reduction Act can be found here. The easiest way to learn more about how the new Clean Energy Credit might apply to you is to talk with your local Lawrence solar panel company.

State & Local Solar Incentives

Some solar incentives are often also offered at the local or state level. Like with federal incentives, these might include tax credits, rebates and more. These incentives may be provided by your county or municipality, or by the Massachusetts government. Certain incentives are ongoing, while others are available for a limited time.

Next Steps for Installing Solar in Lawrence

The nationwide use of solar energy has gone up tremendously in the last 15 years, in part due to the proliferation of solar incentives. You might receive these incentives from the Massachusetts government, the federal government or your local utility company. Talking to your local Lawrence solar panel installation company is an excellent first step towards getting the most money possible when you switch to solar energy.