2023 Solar Incentives Guide for Ravenna, OH - Tax Credits & Rebates

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

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

The term "solar incentives" covers 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. Solar incentives may include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are handled by the federal government, some by the Ohio government and some by your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:

• Net Metering: Net metering becomes relevant once your solar system is up and running. If you have in place a net metering agreement with your Ravenna utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in others you might receive a refund equivalent to a percentage of the value.
• Tax Exemptions: Your solar panels could qualify for both sales tax and property tax exemptions. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to ignore the value that solar panels add when you are calculating property taxes on your home.
• Solar Renewable Energy Certificate (SREC): In most cases, solar systems that produce over a specific (usually small) amount of electricity can qualify for SRECs or other performance-based incentives. SRECs and performance-based incentives in general are typically provided at the state level. When you receive an SREC, you can sell it to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.
• Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
• Rebates: Some solar companies will help you claim a rebate, or partial refund of your purchase, for your solar panels. Counties or states will also offer limited-time rebates at various times. The value of a rebate will usually be deducted from your total price before tax credits are calculated.

Federal Solar Incentives

When you hear the term "solar incentives," federal incentives are likely the first thing that comes to mind. An incentive many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a certain percentage of the cost of your solar system.

The ITC initially applied to 30% of the total cost of solar panel installation, although that number has fluctuated slightly over the last few years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total cost of installation includes the panels themselves as well as the cost of labor, equipment and accessories. There is no maximum claim amount. The ITC applies 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.

Your local Ravenna solar panel installation expert can give you more information about the ITC and how it might apply to your situation.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now referred to as the Clean Energy Credit. Now, solar installation projects started after January 1, 2022 and completed by the end of 2032 might qualify for a 30% tax credit. This percentage will then decrease slightly each year until the current Clean Energy Credit expires in 2035. Starting in 2023, it will also be easier to claim credits for energy storage systems with the new act.

More information about the new Inflation Reduction Act can be found here. To better understand how the new Clean Energy Credit will apply to you, get in touch with your local Ravenna solar installation expert.

State & Local Solar Incentives

Some solar incentives may be provided by state and local governments. As with federal incentives, these may include rebates, tax credits and more. Certain incentives are ongoing, while others may only be available for a limited time. They might be provided by your county or municipality, or by the Ohio government.

Next Steps for Installing Solar in Ravenna

There are a number of different solar incentives: those provided by the federal government, those provided by the Ohio government and those provided by local utility companies, to name a few. The use of solar energy has grown enormously in the last 15 years, thanks to these incentives. We recommend talking to your local Ravenna solar installer to learn more about these incentives and to ensure that you're getting the most money possible for your solar panels.