2024 Solar Incentives Guide for Friendswood, TX - Tax Credits & Rebates

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

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

The term "solar incentives" 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. Incentives may include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are handled federally, while others are handled by the Texas government or your specific utility company, county or municipality. Some solar incentives you might qualify for are:

• Net Metering: Net metering factors in after your solar panels are up and running. If you have a net metering agreement in place with your Friendswood utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some areas, this credit is dollar-for-dollar, while in other places 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 panels. These may be offered by your local utility company, your state or your county. The cash back that you get from the rebates is normally applied before tax credits are calculated.
• 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: Your solar panel system might qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions let you exclude the added value of the solar panels when you are calculating property taxes on your home.

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Federal Solar Incentives

When you think about solar incentives, you likely think of federal incentives first. You may have heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit that reduces your taxes by a specified percentage of the money you spend installing solar panels.

The ITC can be applied to solar systems installed after January 1, 2006, on a primary or secondary residence that you own in the United States. Initially, the credit applied to 30% of the total cost – for panels, accessories, equipment and labor – although it may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the amount you can claim.

To find out exactly how much the ITC could save you, get in touch with your local Friendswood solar panel installer.

The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. Under the new program, solar installation projects that are completed between 2022 and 2032, may be eligible for a 30% tax credit. This credit amount will then see a slight annual decrease until the end of the current Clean Energy Credit in 2035. The program expansion also makes credits for energy storage systems even easier to claim, beginning in 2023.

Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit will apply to you, talk to your local Friendswood solar installation company.

State & Local Solar Incentives

In addition to federal solar incentives, there are often also state ones. Tax credits, rebates and more might be available at a more local level. The incentives — which may be given by the state of Texas, or by your county or municipality — could be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Friendswood

The large number of solar incentives available has enormously increased the use of solar power nationwide over the last 15 years. You might qualify for solar incentives from the federal government, the Texas government or from your local utility company. If you're ready to switch over to solar energy, getting in touch with your local Friendswood solar panel installation expert is a great first step.