2025 Solar Incentives Guide for Shelby, MI - Tax Credits & Rebates

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

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

Solar incentives mitigate the cost of installing a solar panel system on your home. Financial incentives like these are intended to encourage more homeowners to make the switch to renewable energy. Incentives could include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered federally, while others are provided by the Michigan government or by your utility company, county or municipality. Types of solar incentives might include:

• Net Metering: Be sure to talk to your Shelby utility company about signing a net metering contract. This allows you to get a credit towards your monthly utility bill for the value of excess energy your solar panels generate. You may receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Exemptions: Your solar panel system might qualify for both sales tax and property tax exemptions. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions allow you to exclude the value that solar panels add when you are calculating property taxes on your house.
• Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar system. These could be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
• Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government. (A tax credit 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. A federal incentive many people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a predetermined percentage of the cost of your solar system.

The ITC initially applied to 30% of the total cost of solar panel installation, and has fluctuated slightly over the last few years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The cost of installation includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum claim amount. The ITC applies to solar systems installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.

To more fully understand how the ITC might apply to your situation, call your local Shelby solar panel installer and request more information.

In August 2022, the ITC (now called the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. The Clean Energy Credit has increased the current credit up to 30% for solar installation projects started after January 1, 2022, and completed by the end of 2032. After this, the percentage will see a slight decrease annually until the program expires in 2035. The expansion to the program 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 Shelby solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it will apply to you.

State & Local Solar Incentives

In addition to those provided at the federal level, there are often also state solar incentives. Tax credits, rebates and more may be available at a more local level. These solar incentives — which might be handled by the state of Michigan, or by your county or municipality — might be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Shelby

The variety of solar incentives available has helped tremendously increase the adoption of solar energy nationwide over the past 15 years. You might qualify for solar incentives from your local utility company, the Michigan government or the federal government. We suggest talking to your local Shelby solar installation company for more information about these incentives and to be sure that you're getting the most money possible for your solar panels.