2023 Solar Incentives Guide for Rochester, MI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Rochester.
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 Rochester?
Michigan Saves - Home Energy Loan Program
Federal Residential Renewable Energy Tax Credit
The phrase "solar incentives" includes a range of financial incentives implemented to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Various kinds of incentives, like discounts, cash back or monthly utility bill credits, may be available to you. Certain incentives may be handled by the state of Michigan, by your utility company or by county or municipality, while others are federal. Types of solar incentives might include:
- Rebates: A rebate is a partial refund after the purchase of your solar panels. Rebates may be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.
- Net Metering: Make sure you speak with your Rochester 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 could receive either a dollar-for-dollar credit or a percentage of the value.
- Tax Exemptions: Your solar panels might qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions let you exclude the value added by your solar panels when calculating property taxes on your home.
- Tax Credits: Tax credits lower, dollar-for-dollar, the total amount of tax you owe the federal government. These differ from tax deductions.
Federal Solar Incentives
When thinking about solar incentives, you probably think of federal incentives first. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a certain percentage of the cost of your solar system.
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. You can receive this credit for a solar panel system installed on a primary or secondary residence in the United States that you own. Originally, you could claim 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum amount you can claim.
Your local Rochester solar panel installation expert can provide you with more information about the ITC and how it may apply to your situation.
The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as renaming it to the Clean Energy Credit). Homeowners can now receive a credit of 30% of the total costs of solar system installation for projects that began after January 1, 2022 and will be finished by the end of 2032. The credit percentage will then begin to decrease yearly until the Clean Energy Credit expires in 2035. Starting in 2023, the expansion to the program will also make claiming credit for energy storage systems easier than ever before.
Click here to learn more about the new Inflation Reduction Act. Your local Rochester solar panel company is the best resource for answering your questions about the new Clean Energy Credit and how it applies to you.
State & Local Solar Incentives
There are often also state solar incentives in addition to those provided by the federal government. Rebates, tax credits and more can be offered at a more local level. Certain incentives are offered for only a limited time, while others are ongoing. Your local incentives could come from your county or municipality, or from the Michigan government.
Next Steps for Installing Solar in Rochester
You can receive solar incentives from the federal government and the Michigan government, as well as from your local utility company. The growing availability of solar initiatives in the past 15 years has helped increase nationwide solar energy use enormously. If you're ready to make the change to solar energy, getting in touch with your local Rochester solar panel installation expert is an excellent place to start.
EcoWatch's Rochester, 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.