2023 Solar Incentives Guide for Ferndale, MI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Ferndale.
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 March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Ferndale?
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Federal Residential Renewable Energy Tax Credit
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Solar incentives mitigate the cost of installing solar panels on your home. This category of financial incentives is designed to encourage more people to switch their home over to renewable energy. Incentives could include things like discounts, cash back or credit on your utility bill each month. Some incentives are offered federally, while others are provided by the state of Michigan or by your utility company, county or municipality. Categories of solar incentives include:
- Net Metering: Net metering becomes relevant after your solar system is up and running. If you have a net metering agreement with your Ferndale utility company, it 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 make back a percentage of the value.
- Rebates: Rebates, or cash back after a purchase, are typically given before any solar tax credits are calculated. These rebates may be offered by your local utility company, by your state or by your county.
- Tax Exemptions: Sales tax exemptions go into effect at the point of sale for your solar system. Property tax exemptions allow you to ignore the added value of your solar system when calculating the amount of property tax you need to pay.
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (This is different from a tax deduction.)
Federal Solar Incentives
When thinking about solar incentives, federal incentives are likely the first thing that comes to mind. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit that reduces your taxes by a specified percentage of the money you spend on your solar system.
The ITC applies towards solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, equipment, labor and accessories. This credit can be claimed on solar panels installed on a primary or secondary residence in the United States that you own. The original claim amount was 30% of the total cost, although certain projects may qualify for only 26%, depending on the details. There is no maximum claim amount.
Wondering how the ITC applies to your specific situation? Reach out to your local Ferndale solar panel installer to get more information.
In August 2022, the ITC (now referred to as the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. The new Clean Energy Credit now runs until 2035. American homeowners can now apply for a 30% credit for solar systems that began installation after January 1, 2022 and are completed by the end of 2032. The credit will then be decreased by a few percentage points every year until it expires. The program 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 Ferndale solar panel company can answer your questions and explain how the new Clean Energy Credit will apply to you.
State & Local Solar Incentives
Tax credits, rebates and more can be claimed at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. These incentives — which might be given by the state of Michigan, or by your county or municipality — may be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Ferndale
The variety of available solar incentives has helped tremendously increase the use of solar power nationwide over the past 15 years. You might qualify for solar incentives from the federal government, the Michigan government or from your local utility company. We suggest talking to your local Ferndale solar installation expert to learn more about these incentives and to ensure that you're getting the largest number possible for your solar system.
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Michigan Solar Solutions
- Great warranty coverage
- Outstanding customer service
- Offers products from leading manufacturers
- Slightly limited service offerings
- No leases or PPAs
Outstanding Local Installer
Strawberry Solar
- Outstanding customer service
- Representatives are experts on local policies
- Educational, no-pressure sales approach
- Limited warranty coverage
- No leases or PPAs
- Limited brands of solar equipment available
EcoWatch's Ferndale, MI Solar Incentives FAQs
How can I find out if I qualify for specific solar incentives?
It's a good idea to talk to your local Ferndale solar installer to get an understanding of which incentives your project may qualify for. In most cases, solar incentives apply to new solar systems installed on property you own (in the U.S.) between the dates specified by the incentive. Some incentives, such as those given by the state of Michigan, may have additional requirements.
What are the best solar panel installation companies near me?
To learn about the best solar panel installers near you, take a look at our article on the top solar companies in Ferndale.
What are some of the environmental benefits of switching to solar energy?
You can lower your carbon footprint by 500 pounds of CO2 a year when you install solar panels. This adds up to roughly 10,000 pounds over 20 years. In addition, solar power is a renewable energy source, meaning that switching your home over reduces the drain on our planet's resources.
When does the federal solar tax credit end?
The Clean Energy Credit (previously referred to as the federal solar tax credit, or ITC), currently ends on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
If I switch my appliances out for ones that utilize solar energy, are there benefits I can claim?
The recently passed Inflation Reduction Act includes provisions for multiple incentives that reward homeowners for making eco-friendly upgrades. Some incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.
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.