2023 Solar Incentives Guide for Lima, MI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Lima.
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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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
Why you can trust EcoWatch
What Solar Tax Credits, Incentives, and Rebates are Available in Lima?
Michigan Saves - Home Energy Loan Program
Energy Optimization (Electric) - Residential Efficiency Program
Chest Freezer: $50
Window Air Conditioners: $15
WiFi Thermostat: $75
ECM Blower Motor: $200
Central Air Conditioning: 150 - $500
Central Air-Source Heat Pump: $250 - $500
Mini/Multi-Split Air-Source Heat Pump: $250 - $750
HVAC Combo Bonus: $100 bonus
Smart HVAC Combo Bonus: $150 bonus
Tune-Up Central Air Conditioner or Air-Sourse Heat Pump: $50
Ground-Source Heat Pump: $500 - $750
Efficient Circulation Pump: $100
Heat Pump Water Heater: $500
Pool Pump: $250
Pipe Wrap Insulation: $0.80/ft. ($8 max)
ENERGY STAR Products
LED Bulbs: In-store savings vary by retailer
LED Downlight Kits: In-store savings vary by retailer
Outdoor LED Fixtures: $5
Ceiling Fan: $10
Advanced Power Strip: $5
Room Air Conditioner: $10
Air Purifier: $10
Clothes Washer: $20
Chest Freezer or Upright Freezer: $15
Television: $10 - $20
Personal Computer: $10
Occupancy Sensor: $5
Wifi-Enabled Thermostat: $75
Income Qualified Services
Free Product Kit: May include energy-saving items, such as LED lights and a smart power strip
Consumers Energy (Electric) - Residential Energy Efficiency Program
Washing Machine: $25 - $50
WiFi Enabled Thermostat: $50 - $100
Room Air Conditioner: $20
Pool Pump: $350
Refrigetor/Freezer Recyclilng: $50
Room Air Conditioner/Dehumidifier Recycling: $15
Heating & Cooling
Split System Central AC: $50 - $500
Air Source Heat Pump: $150 - $250
Ground Source Heat Pump: $200 - $300
Ductless Mini-Split Heat Pump: $350
ECM Motor: $50
Thermostat: $10 - $100
Central AC Tune-Up: $50
Windows & Insulation
Roof Insulation: $50 - $200
Wall Insulation: $50 - $125
Crawlspace Insulation: $10 - $50
Rim Joist Insulation: $20 - $50
Window Replacement: $15/window
Patio Door Replacement: $40/door
Federal Residential Renewable Energy Tax Credit
The phrase "solar incentives" includes a range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. You may be eligible for different types of incentives, including discounts, cash back or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the Michigan government and others from the federal government. Some solar incentives you might qualify for are:
- Net Metering: Net metering factors in after your solar system is up and running. If you have a net metering agreement with your Lima utility company, it will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some areas, this credit is dollar-for-dollar, while in other areas you might get refunded a percentage of the value.
- Tax Exemptions: Sales tax exemptions are effective at the point of sale for your solar system. Property tax exemptions let you exclude the value added by your solar system when calculating how much property tax you need to pay on your house.
- Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the federal government.
- Rebates: Solar rebates may be offered by your local utility company, or by your county or state. These rebates are essentially cash back that is applied after you purchase solar panels and before tax credits are calculated.
Federal Solar Incentives
When thinking about solar incentives, federal incentives might be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is probably the most commonly known federal solar incentive. The ITC provides a tax credit for a predetermined percentage of your solar system's cost.
The ITC can be applied to solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, labor, equipment and accessories. This credit can apply towards a solar panel system installed on a primary or secondary residence that you own in the United States. The original amount you could claim was 30% of the total cost, although certain projects may qualify for only 26%, depending on the details. There is no maximum claim amount.
To know exactly how much money the ITC could save you, speak with your local Lima solar panel installer.
The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The Clean Energy Credit lasts until 2035. Solar installation projects started after January 1, 2022 and completed by the end of 2032 may qualify for a 30% tax credit. The amount will then decrease slightly each year until the end of the current program. The expansion to the program also makes claiming credit for energy storage systems easier than ever before, starting in 2023.
Click here to learn more about the new Inflation Reduction Act. To better understand how the new Clean Energy Credit might apply to you, reach out to your local Lima solar installation company.
State & Local Solar Incentives
Some solar incentives are often also offered at the local or state level. Similar to federal incentives, these could include tax credits, rebates and more. Some incentives are offered for only a limited time, while others are ongoing. These local incentives may come from the Michigan government, or from your specific county or municipality.
Next Steps for Installing Solar in Lima
The nationwide use of solar energy has increased enormously in the past 15 years, in part due to the increase in availability of solar incentives. You can obtain these incentives from your local utility company, the federal government or the Michigan government. Getting in touch with your local Lima solar panel installation expert is the right first step towards making sure you get all the incentives you qualify for when you switch to solar energy.
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
- 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 Lima, MI Solar Incentives FAQs
Can I claim incentives for adding solar panels to a rental property, vacation home or commercial property?
While we recommend speaking with your local solar installer and/or tax professional to fully understand what solar incentives apply to you, many will apply to a second home, provided that it is in the United States and owned by you. There may be additional incentives available specifically for commercial properties, depending on the details.
How much will a solar system save me on my electric bill in Lima annually?
When you add solar panels to your home in Lima, you can anticipate savings of approximately $889.58 per year, or approximately $16,902.05 over 20 years.
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 by switching to solar panels. This adds up to around 10,000 pounds over 20 years. In addition, solar power is a renewable energy source, meaning that switching your home over lessens the drain on our planet's resources.
When does the federal solar tax credit end?
The Clean Energy Credit (formerly named 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.
I want to switch my appliances out for ones that are more energy-efficient. Are there any credits I can get?
With the passage of the new Inflation Reduction Act, there are a variety of new financial incentives to encourage you to make eco-friendly improvements to your home. More details about these incentives, including information about incentives for purchasing new appliances, can be found 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.