2023 Solar Incentives Guide for Richmond, MI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Richmond.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Richmond?
Michigan Saves - Home Energy Loan Program
Federal Residential Renewable Energy Tax Credit
The phrase "solar incentives" generally refers to financial incentives implemented by the government and by solar companies to encourage the adoption and use renewable energy by making installing and using solar panels more affordable. Different kinds of incentives, such as discounts, cash back or monthly utility bill credits, may be available to you. Certain incentives may be provided via the Michigan government, by your utility company or by county or municipality, while others are federal. Categories of solar incentives include:
- Rebates: Solar rebates may be provided by your local utility company, or by your state or county. These rebates work as partial refunds that are applied after you pay for a solar system and before tax credits are calculated.
- Net Metering: Net metering factors in after your solar panels are up and running. If you have a net metering agreement with your Richmond utility company, it will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in others you might get refunded a percentage of the value.
- Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
- Tax Exemptions: Tax exemptions may come in two forms. First, there is sales tax exemption, applied at the time you purchase your solar panels. The second is property tax exemption. This allows you to exclude the added value of your solar system when calculating property tax for your house.
Federal Solar Incentives
When you think about solar incentives, you probably think of federal incentives first. An incentive many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a certain percentage of the cost of your solar system.
The ITC applies to the total cost of installing a solar system, including the panels themselves as well as labor, accessories and equipment. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence that you own, as long as it is located in the United States. The tax credit ranges from 26-30% of total costs depending on when your project was completed. There is no maximum claim amount.
Wondering how the ITC applies to your specific situation? Get in touch with your local Richmond solar panel installer to get more information.
In August 2022, the Inflation Reduction Act expanded and extended the ITC, now titled the Clean Energy Credit. For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners may be eligible for a credit equal to 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit expires in 2035. Starting in 2023, the expansion will also make credits for energy storage systems even easier to claim.
Click here to learn more about the new Inflation Reduction Act. The best way to learn more about how the new Clean Energy Credit applies to you is to speak with your local Richmond solar panel company directly.
State & Local Solar Incentives
Some solar incentives may be offered at the local or state level. Like with federal incentives, these could include rebates, tax credits and more. Some incentives are ongoing, while others may only be available for a limited time. Incentives may be given by the Michigan government, or by your county or municipality.
Next Steps for Installing Solar in Richmond
There are many kinds of solar incentives: those offered by local utility companies, those offered by the Michigan government and those offered by the federal government, to name a few. Solar energy use has grown tremendously in the last 15 years, partially thanks to these incentives. If you're prepared to switch over to solar energy, talking to your local Richmond solar panel installation expert is an excellent place to start.
EcoWatch's Richmond, MI Solar Incentives FAQs
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.