2023 Solar Incentives Guide for Worcester, MA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Worcester.
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 Worcester?
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)
MuniHELPS - Offered by 17 Utilities through the MMWEC
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are designed to make renewable energy usage more affordable through financial incentives to help people install solar panels on their homes. You may qualify for several types of incentives, including discounts, cash back or monthly utility bill credits, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of Massachusetts and others from the federal government. Categories of solar incentives include:
- Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives might be available to you if the solar system on your home produces over a specified (usually small) amount of electricity. Performance-based incentives are typically handled by the state government. You can sell SRECs to your utility company or other buyers, and the money you receive in return is normally considered part of your taxable income.
- Tax Exemptions: These may come in the form of property tax exemptions, which let you ignore the value of your solar system when paying property tax on your home. They may also include exemptions on sales tax at the time of purchase.
- Net Metering: Net metering becomes relevant after your solar panels are up and running. If you have a net metering agreement with your Worcester utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some areas, this credit is dollar-for-dollar, while in other areas you may be refunded a percentage of the value.
- Tax Credits: Tax credits lower, dollar-for-dollar, the amount of income tax you owe the federal government. Tax credits are different from tax deductions.
- Rebates: Rebates, or partial refunds after a purchase, are typically given prior to any solar tax credits being calculated. Rebates can be provided by your local utility company, by your state or by your county.
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Federal Solar Incentives
When you hear the term "solar incentives," federal incentives are likely the first thing that comes to mind. A federal incentive many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a certain percentage of your solar system's cost.
The ITC can be applied to solar systems installed after January 1, 2006 on a primary or secondary residence in the United States that you own. Originally, the tax credit was for 30% of the total cost — for panels, accessories, labor and equipment — although that amount may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the claim amount.
Talking to your local Worcester solar panel installation expert is the best way to learn more about how the ITC could apply to your situation.
In August 2022, the Inflation Reduction Act expanded and extended the ITC, now referred to as the Clean Energy Credit. The Clean Energy Credit has increased the current credit up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. At this point, the credit percentage will be reduced slightly each year until the end of the program in 2035. The expansion also makes it easier to get credit for energy storage systems, starting in 2023.
Click here to learn more about the new Inflation Reduction Act. Your local Worcester solar panel installers are the best people to answer your questions about the new Clean Energy Credit and how it applies to you.
State & Local Solar Incentives
Some solar incentives are often also provided by state and local governments. Like with federal incentives, these can include tax credits, rebates and more. These incentives — which may be handled by your county or municipality, or by the state of Massachusetts — might be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Worcester
Solar energy use nationwide has increased enormously in the last 15 years, in part thanks to the growth in the number of solar incentives. You can obtain these incentives from the federal government, the Massachusetts government or your local utility company. We suggest talking to your local Worcester solar installation expert to learn more about these incentives and to ensure that you're getting the largest number possible for your solar panels.
EcoWatch's Worcester, MA Solar Incentives FAQs
How can I learn if I qualify for specific solar incentives?
It's best to speak with your local Worcester solar installer for a better understanding of which incentives your project will qualify for. In most cases, solar incentives apply to new solar panel systems installed on property you own (in the U.S.) between the dates specified by the incentive. Some incentives, such as those provided by the Massachusetts government, may have other requirements.
I already have solar panels installed. Do I qualify for any incentives?
You should plan to talk to the company that installed your solar panels — or reach out to a local Worcester solar installer — to learn about which incentives you might qualify for. If your solar panels were installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
I want to change out my appliances for ones that are more energy-efficient. Are there any benefits I can claim?
The new Inflation Reduction Act creates several new financial incentives to encourage you to make eco-friendly improvements to your home. More details on these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I qualify for incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order your incentives will be applied in may vary depending on which incentives you are claiming but generally yes, you can claim multiple types of incentives for your solar project. Talk with your solar installer or a local tax professional to verify you are claiming all possible incentives and applying them in the correct order.
Can I use both solar and another type of renewable energy to power my home?
Yes, you can employ multiple types of renewable energy to power your home — for example, a combination of solar and geothermal. You can also combine renewable energy generation with a backup source of non-renewable energy. You should discuss your plan with your local Worcester solar panel installer, so that you understand what you'll need and what incentives you might or might not 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.