2024 Solar Incentives Guide for Durham, NC - Tax Credits & Rebates

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

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

The term "solar incentives" generally refers to financial incentives implemented by the government and by solar companies to encourage the use of renewable energy by making installing and using solar panels more affordable. Various kinds of incentives, including cash back, discounts or credit towards your monthly utility bill, might be available to you. Some incentives may be provided via the North Carolina government, by your utility company or by county or municipality, while other incentives are federal. Some broad categories of solar incentives include:

• Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
• Tax Exemptions: These could come in the form of property tax exemptions, which allow you to ignore the value added by your solar panels when paying taxes on your house. You may also qualify for an exemption on sales tax at the time of purchase.
• Rebates: Rebates, or partial refunds after a purchase, are normally given prior to any solar tax credits being calculated. These rebates might be provided by your local utility company, by your county or by your state.
• Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives might be available to you if the solar system on your home produces more than a specified (typically small) amount of electricity. These types of incentives are generally handled at the state level. You can sell your SRECs to your utility company or other buyers, and the money you receive in return is generally considered part of your taxable income.
• Net Metering: Make sure you talk to your Durham 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 may receive either a dollar-for-dollar credit or a percentage of the value.

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Federal Solar Incentives

When thinking about solar incentives, you likely think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is likely the most commonly known federal solar incentive. The ITC provides you with a tax credit for a specific percentage of your solar system's cost.

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, equipment, accessories and labor. This credit can apply towards 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 the amount you can claim may range between 26-30%. There is no maximum amount you can claim.

Reaching out to your local Durham solar panel installation expert is the best way to learn more about how the ITC applies to you.

The ITC has been renewed and expanded following the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The Clean Energy Credit runs until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit. This amount will be decreased slightly each year until the end of the current program. Starting in 2023, the expansion will also make claiming credit for energy storage systems easier than ever before.

More information about the new Inflation Reduction Act can be found here. To understand how the new Clean Energy Credit applies to you, reach out to your local Durham solar installation company.

State & Local Solar Incentives

Some solar incentives are often also offered at the local or state level. As with federal incentives, these may include rebates, tax credits and more. These incentives might be provided by the North Carolina government, or by your county or municipality. Some incentives may be available for a limited time, while others are ongoing.

Next Steps for Installing Solar in Durham

There are a variety of solar incentives: those offered by local utility companies, those offered by the North Carolina government and those offered by the federal government, to name a few. Solar energy utilization has increased tremendously in the last 15 years, thanks to these incentives. When you're ready to make the change to solar energy, calling your local Durham solar panel installation expert is a great first step.