2023 Solar Incentives Guide for Chapel Hill, NC - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Chapel Hill.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated March 14, 2023
Why you can trust EcoWatch
What Solar Tax Credits, Incentives, and Rebates are Available in Chapel Hill?
Duke Energy - NC Solar Rebate Program
Property Tax Abatement for Solar Electric Systems
All other systems: 80% of the appraised value
Active Solar Heating and Cooling Systems Exemption
EnergyUnited (Electric) Residential Energy Efficiency Program
Heat Pumps (16 SEER): $300/unit
Duke Energy (Electric) - Residential Energy Efficiency Rebate Program
Geothermal Heat Pump: $400 + $50 with added smart thermostat
Heat Pump Water Heater: $350
Attic Insulation or Attic Air Sealing: $250
Duct Sealing: $100
Variable-Speed Pool Pumps: $300
NC GreenPower Production Incentive
PV larger than 5 kW: must enter bid process
Wind up to 10 kW: $0.09/kWh
Wind larger than 10 kW: must enter bid process
Local Option - Financing Program for Renewable Energy and Energy Efficiency
Local Option - Green Building Incentives
Duke Energy Progress - Residential Energy Efficiency Rebate Program
Geothermal Heat Pumps: $400 + 50 with smart thermostat
Heat Pump Water Heater: $350
Attic Insulation & Air Sealing: $250
Duct Sealing: $100
Pool Pump: $300
Piedmont EMC - Residential Solar and Energy Efficiency Loan Program
Federal Residential Renewable Energy Tax Credit
Solar incentives are designed to make renewable energy usage more affordable through financial incentives for individuals who install solar panels on their homes. The incentives could include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are given by the federal government, some by the state of North Carolina and some by your specific utility company, county or municipality. Some broad categories of solar incentives include:
- Rebates: Solar rebates may be offered by your state or county, or by your local utility company. These rebates are essentially cash back that is applied after you purchase a solar system and before tax credits are calculated.
- Net Metering: Net metering is an incentive you can get after your solar system is up and running. If you have a net metering agreement with your Chapel Hill utility company, it will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some areas, this is a dollar-for-dollar credit, while in others you might get refunded a percentage of the value.
- Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives may be available to you if you have a solar system that produces more than a specified (generally small) amount of electricity. These types of incentives are generally handled by the state government. You can sell SRECs to your utility company or other buyers, and the money you make is normally considered part of your taxable income.
- Tax Exemptions: These may come in the form of property tax exemptions, which would allow you to ignore the value of your solar system when paying taxes on your home. You may also qualify for an exemption on sales tax at the time of purchase.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
Federal Solar Incentives
When people think of solar incentives, federal incentives are likely the first thing that comes to mind. A federal incentive many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a specific percentage of the cost of your solar system.
The ITC was originally for 30% of the total cost of solar system installation, and has fluctuated slightly over time between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total cost of installation includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum amount you can claim. The ITC can be applied to solar panels installed after January 1, 2006 on your primary or secondary residence. The residence must be owned by you and in the United States.
Wondering how the ITC applies to your specific situation? Reach out to your local Chapel Hill solar panel installation expert to get more information.
In August 2022, the ITC (now referred to as the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. At this point, the percentage will be reduced slightly each year until the end of the program in 2035. The expansion also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.
More information about the new Inflation Reduction Act can be found here. To better understand how the new Clean Energy Credit might apply to you, get in touch with your local Chapel Hill solar installers.
State & Local Solar Incentives
Tax credits, rebates and more might be provided at multiple levels. On top of federal solar incentives, there are often state and local ones as well. Incentives might be handled by the state of North Carolina, or by your county or municipality. Certain incentives are available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Chapel Hill
You can apply for solar incentives from the federal government and the North Carolina government, as well as from your local utility company. The increased availability of solar initiatives over the last 15 years has helped greatly increase nationwide adoption of solar energy. We suggest talking to your local Chapel Hill solar installer to learn more about these incentives and to make sure that you're getting the most money possible for your solar system.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries (coming 2022)
Outstanding Regional Installer
Renu Energy Solutions
- Excellent reputation
- Many financing options
- Representatives are experts on local policies
- No leases or PPAs
EcoWatch's Chapel Hill, NC Solar Incentives FAQs
How much will solar panels save me on my electric bill in Chapel Hill annually?
When you add solar panels to your home in Chapel Hill, you can expect to save about $929.63 per year, or about $17,662.91 over the next 20 years.
What are the best solar panel installation companies near me?
To find a top-rated solar panel installer, check out our guide to the top solar companies in Chapel Hill.
What are some environmental benefits of adding solar panels to my house?
Solar energy is renewable — by switching where you get your energy, you help lessen the strain on our planet's resources. You can also reduce your home's CO2 emissions by 300 pounds a year, or around 6,000 pounds over 20 years.
I want to switch my appliances out for ones that are more energy-efficient. Are there any credits I can get?
The recently passed Inflation Reduction Act provides several incentives that reward homeowners for making eco-friendly upgrades. Some incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
Can I use a combination of solar and another type of renewable energy to power my home?
Yes, you can employ multiple types of renewable energy to power your home, such as a combination of solar and geothermal. You can also use both renewable energy sources and a non-renewable backup source of energy. Be sure to discuss your plan with your local Chapel Hill solar installation expert, to get an understanding of what will be needed and what incentives you may or may not qualify for.
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.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.