2023 Solar Incentives Guide for Johnson City, TN - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Johnson City.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Johnson City?
Green Energy Property Tax Assessment
Federal Residential Renewable Energy Tax Credit
Solar incentives are meant to encourage people to switch to renewable energy by offering incentives that lower the financial burden of solar panel installation and use. Different types of incentives, like cash back, discounts or credit towards your monthly utility bill, may be available to you. Some incentives may be handled by the state of Tennessee, by your utility company or by county or municipality, while others are federal. Some broad categories of solar incentives include:
- Net Metering: Net metering becomes relevant after your solar system is up and running. If you have a net metering agreement with your Johnson City utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in other places you may be refunded a percentage of the value.
- Tax Credits: Tax credits reduce, dollar-for-dollar, the amount of income tax you owe the federal government. Tax credits are different from tax deductions.
- Rebates: Solar rebates might be provided by your local utility company, or by your state or county. These rebates work as partial refunds that are applied after you purchase solar panels and before tax credits are calculated.
- Tax Exemptions: Tax exemptions may come in one of two forms. The first is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption. This allows you to exclude the value added by your solar system when paying property tax on your house.
Federal Solar Incentives
Federal solar incentives are likely the first thing that comes to mind when you think about solar incentives. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit equal to a predetermined percentage of the money you spend on solar panels for your home.
The ITC originally covered 30% of the total cost of installing solar panels, although that number has fluctuated slightly over the years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total installation cost includes the panels themselves as well as the cost of equipment, accessories and labor. There is no maximum claim amount. The ITC can be applied to solar panels installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.
Curious how the ITC might apply to your specific situation? Reach out to your local Johnson City solar panel installer to get more information.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as retitling it the Clean Energy Credit). Homeowners are now eligible for a credit equal to 30% of the total costs of solar system installation for projects started after January 1, 2022 and completed before the end of 2032. The percentage will then decrease on a yearly basis until the Clean Energy Credit expires in 2035. Starting in 2023, the expansion will also make credits for energy storage systems even easier to claim.
Click here to learn more about the new Inflation Reduction Act. Your local Johnson City solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it 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 can be offered at a more local level. Incentives might be handled by the state of Tennessee, or by your county or municipality. Some incentives might only be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Johnson City
There are a variety of solar incentives: those offered by local utility companies, those offered by the Tennessee government and those offered by the federal government, to name a few. The use of solar energy has grown enormously in the last 15 years, thanks to these incentives. Speaking with your local Johnson City solar panel installation expert is the best first step towards getting all the incentives you qualify for when you switch to solar energy.
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- Some reported communication issues
- No leases or PPAs
- Price-match guarantee
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- Some reported issues with customer service
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EcoWatch's Johnson City, TN Solar Incentives FAQs
I already have solar panels. Do I qualify for any incentives?
If your solar panels were installed after January 1, 2022, you may qualify for the newly increased 30% tax credit under the Inflation Reduction Act. If your system was installed between 2006 and 2021, you might qualify for a tax credit between 26% and 30%, depending on the exact installation date. Speaking with a representative from the company that installed your system, or any local Johnson City solar installer, can help you learn what incentives you can apply for.
How much can I save on my electric bill annually if I add solar panels to my house in Johnson City?
On average, Johnson City homeowners who install solar panels save around $850.66 per year, or around $16,162.48 over 20 years after they make the switch.
What are some environmental benefits of adding solar panels to my home?
Solar energy is renewable — by switching where you get your energy, you can help lessen the strain on our planet's resources. A solar system can also reduce your home's CO2 emissions by 400 pounds annually, or roughly 8,000 pounds over 20 years.
If I switch my appliances out for ones that use solar energy, are there any benefits I can claim?
Under the new Inflation Reduction Act, there are a number of new financial incentives for making eco-friendly improvements to your home. More details on these incentives, including information about incentives for purchasing new appliances, can be found here.
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.