2025 Solar Incentives Guide for Worcester, MA - Tax Credits & Rebates

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

Source: https://www.dsireusa.org/

Solar incentives are meant to help mitigate the cost of installing solar panels on your home. This category of financial incentives is in place to encourage more Americans to switch to renewable energy. Different kinds of incentives, such as cash back, discounts or monthly utility bill credits, might be available to you. Some incentives may be handled by the Massachusetts government, by your utility company or by county or municipality, while other incentives are federal. You might qualify for any of the following types of solar incentives:

• Net Metering: Be sure to speak to your Worcester 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 generated by your solar panels. You might receive either a dollar-for-dollar credit or a percentage of the value.
• Rebates: Solar rebates can be offered by your local utility company, or by your state or county. These rebates are essentially partial refunds that are applied after you pay for a solar system and before tax credits are calculated.
• Tax Exemptions: Your solar system could qualify for both sales tax and property tax exemptions. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions let you exclude the value added by your solar panels when you are calculating property taxes on your home.
• Tax Credits: Tax credits decrease, dollar-for-dollar, the total amount of tax you owe the federal government. These differ from tax deductions.
• Solar Renewable Energy Certificate (SREC): In most cases, solar systems that produce more than a specified (usually small) amount of electricity will qualify for SRECs or other similar performance-based incentives. SRECs and similar incentives are typically offered at the state level. SRECs can be sold to your utility company or another buyer, and generally the money you make is normally considered part of your taxable income.

Federal Solar Incentives

Federal solar incentives are probably the first thing that you think of when thinking about solar incentives. One of the incentives that most 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 applies 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 the percentage may range from 26-30%, depending on the installation date of your solar system. There is no cap on the claim amount.

Wondering how the ITC applies to your specific situation? Contact your local Worcester solar panel installer to get more information.

The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as renaming it to the Clean Energy Credit). The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar installations undertaken between January 1, 2022, and December 31, 2032. At this point, the percentage will decrease slightly each year until the end of the program in 2035. Starting in 2023, the expansion to the program 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 fully understand how the new Clean Energy Credit applies to you, get in touch with your local Worcester solar installers.

State & Local Solar Incentives

In addition to federal solar incentives, there are often also state ones. Rebates, tax credits and more might be available at a more local level. Certain incentives are offered for only a limited time, while others are ongoing. Local solar incentives may come from your county or municipality, or from the Massachusetts government.

Next Steps for Installing Solar in Worcester

The variety of solar incentives available has helped tremendously increase the use of solar power nationwide over the past 15 years. You may receive solar incentives from the federal government, the Massachusetts government or from your local utility company. It is a good idea to talk to your local Worcester solar installation company for more information about these incentives and to ensure that you're getting all the money you can for your solar panels.