2023 Solar Incentives Guide for Shiprock, NM - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Shiprock.
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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Updated March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Shiprock?
Property Tax Exemption for Residential Solar Systems
Solar Energy Gross Receipts Tax Deduction
Geothermal Heat Pump Tax Credit (Personal)
Geothermal Heat Pump Tax Credit (Corporate)
Local Option - Renewable Energy Financing District/Solar Energy Improvement Special Assessments
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The term "solar incentives" refers broadly to financial incentives implemented by the government and by solar companies to encourage increased use of renewable energy by making installing and using solar panels more affordable. Various types of incentives, like discounts, cash back or monthly utility bill credits, may be available to you. Certain incentives may be handled by the state of New Mexico, by your utility company or by county or municipality, while other incentives are federal. Types of solar incentives might include:
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
- Tax Exemptions: Sales tax exemptions are effective at the time of purchase for your solar panels. Property tax exemptions let you ignore the value that your solar panels add when you calculate the amount of property tax you need to pay.
- Net Metering: Net metering becomes relevant after your solar system is up and running. If you have a net metering agreement with your Shiprock utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some places, this credit is dollar-for-dollar, while in others you might receive a refund equivalent to a percentage of the value.
- Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar system. These may 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 calculating tax credits.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have heard of. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC offers a tax credit for a specific percentage of the cost of your solar system.
The ITC applies to the value of solar panels installed on your primary or secondary residence in the United States. The solar system has to have been installed after January 1, 2006 on a property you own for you to be eligible for the credit. The ITC initially covered 30% of all installation costs (panels, labor, equipment and accessories), although this amount has fluctuated over the years between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the claim amount.
To best understand how the ITC might apply to your situation, call your local Shiprock solar panel installer and request more information.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now referred to as the Clean Energy Credit. Homeowners can now receive a credit equal to 30% of the total solar system installation costs for projects that began after January 1, 2022 and will be finished by the end of 2032. The percentage will then decrease on a yearly basis until the Clean Energy Credit ends in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems with the new act.
Click here to learn more about the new Inflation Reduction Act. The best way to understand how the new Clean Energy Credit applies to you is to reach out to your local Shiprock solar panel company with your questions.
State & Local Solar Incentives
Some solar incentives may be provided at the state and local level. Like with federal incentives, these may include tax credits, rebates and more. Some incentives are ongoing, while others are only available for a limited time. Solar incentives may be offered by the New Mexico government, or by your county or municipality.
Next Steps for Installing Solar in Shiprock
Nationwide solar energy use has significantly increased in the last 15 years, in part thanks to the proliferation of solar incentives. You might receive these incentives from your local utility company, the federal government or the New Mexico government. Speaking with your local Shiprock solar panel installer is the right first step towards getting all the incentives you qualify for when you switch to solar energy.
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
Best Warranty Coverage
Sunpro Solar
- Industry-leading warranty coverage
- Expansive service area
- Some reported communication issues
- No leases or PPAs
EcoWatch's Shiprock, NM Solar Incentives FAQs
Can I claim incentives for adding solar panels to a vacation home, rental property or commercial property?
While we recommend speaking with your local solar installer and/or tax professional to best understand what solar incentives apply to you, many incentives can be claimed on a second home, so long as that home is in the United States and owned by you. There may be other incentives available specifically for commercial properties, depending on the specifics.
How long until the federal solar tax credit ends?
The federal solar tax credit, formerly called the ITC and now named the Clean Energy Credit, is slated to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
If I switch my appliances out for ones that utilize solar energy, are there any incentives that I can claim?
The new Inflation Reduction Act creates a variety of new financial incentives that are available when you make eco-friendly improvements to your home. More details regarding these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I receive incentives both towards the initial cost of solar panels, and later as reimbursement?
The order your incentives will be applied in could vary depending on which incentives you are claiming but usually yes, you can receive multiple types of incentives for your solar project. Check with your solar installer or a local tax professional to make sure you are claiming all possible incentives and applying them in the correct order.
Can I use multiple types of renewable energy to power my home?
You can use multiple types of renewable energy, or a combination of renewable and non-renewable energy, to power your home. Be sure to go over your plan with your local Shiprock solar installer. They can help you with the plan for your project and educate you on the various incentives that you will or won't 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.