2023 Solar Incentives Guide for St Paul, MN - Tax Credits & Rebates

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

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

Solar incentives help mitigate the cost of installing solar panels on your home. This category of financial incentives is in place to encourage more Americans to make the switch to renewable energy. Various types of incentives, like discounts, cash back or monthly utility bill credits, may be available to you. Some incentives may be provided via the Minnesota government, by your utility company or by county or municipality, while others are federal. Some solar incentives you might qualify for are:

• 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 a solar system and before tax credits are calculated.
• Tax Exemptions: Sales tax exemptions are applied at the point of sale for your solar system. Property tax exemptions let you ignore the added value of your solar system when calculating the amount of property tax you need to pay on your home.
• Net Metering: Make sure you talk with your St Paul utility company about signing a net metering contract. This allows you to get a credit towards your utility bill every month for the value of excess energy your solar panels generate. You could receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.

Federal Solar Incentives

When people think of solar incentives, federal incentives may be the first thing that comes to mind. An incentive many people are likely 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 can be applied to solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, accessories, labor and equipment. This credit can be claimed on solar panels 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.

To better understand how the ITC may apply to your situation, get in touch with your local St Paul solar panel installer and ask for more information.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now called the Clean Energy Credit. The Clean Energy Credit re-raises the 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 claiming credit for energy storage systems easier than ever before, starting in 2023.

More information about the new Inflation Reduction Act can be found here. Your local St Paul solar panel company can answer your questions and explain how the new Clean Energy Credit will apply to you.

State & Local Solar Incentives

There are often state solar incentives available in addition to federal ones. Rebates, tax credits and more may be available at a more local level. Some incentives are ongoing, while others are offered for only a limited time. Local solar incentives might come from the Minnesota government, or from your specific county or municipality.

Next Steps for Installing Solar in St Paul

The variety of solar incentives available has contributed greatly to the increase in the nationwide adoption of solar energy over the past 15 years. You might qualify for solar incentives from your local utility company, the federal government or the Minnesota government. When you're prepared to make the change to solar energy, reaching out to your local St Paul solar panel installation expert is a great first step.