2024 Solar Incentives Guide for Albert Lea, MN - Tax Credits & Rebates

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

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The term "solar incentives" refers to a wide range of financial incentives put in place to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Incentives can include things like discounts, cash back or monthly utility bill credits. Some incentives are provided by the federal government, while others are provided by the Minnesota government or your specific utility company, county or municipality. Some broad categories of solar incentives include:

• Net Metering: Net metering is an incentive you can get once your solar panels are up and running. If you have in place a net metering agreement with your Albert Lea utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some places, this is a dollar-for-dollar credit, while in others you may receive a refund equivalent to a percentage of the value.
• Rebates: A rebate is a partial refund credited to your account after you've paid for your solar panels. These might be offered by your local utility company, your state or your county. The cash back that you get from the rebates is normally applied before tax credits are calculated.
• Tax Exemptions: Tax exemptions can come in two forms. The first is sales tax exemption, applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when calculating property tax for your house.
• Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (A tax credit is different from a tax deduction.)

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Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some knowledge of. The Federal Solar Investment Tax Credit, or ITC, is the most well-known federal solar incentive. The ITC allows you to claim a tax credit for a specific percentage of the cost of your solar system.

The ITC can be applied to the total cost of installing a solar system, including the panels themselves as well as accessories, equipment and labor. You can claim this credit for panels installed after January 1, 2006, on a primary or secondary residence located in the United States that you own. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum claim amount.

Have questions about how the ITC applies to your specific situation? Get in touch with your local Albert Lea solar panel installation expert to get more information.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now titled 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 decrease slightly each year until the current program ends. The program expansion also makes credits for energy storage systems even easier to claim, beginning in 2023.

More information about the new Inflation Reduction Act can be found here. The best way to fully understand how the new Clean Energy Credit will apply to you is to reach out to your local Albert Lea solar panel company with your questions.

State & Local Solar Incentives

Some solar incentives are often also offered at the local or state level. Like with federal incentives, these could include rebates, tax credits and more. The incentives — which may be given by the state of Minnesota, or by your county or municipality — could be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Albert Lea

Nationwide solar energy use has increased enormously in the last 15 years, in part thanks to the growth in the number of solar incentives. You might receive these incentives from your local utility company, the federal government or the Minnesota government. When you're ready to make the switch to solar energy, talking to your local Albert Lea solar panel installation expert is an excellent place to start.