2023 Solar Incentives Guide for Lancaster, TX - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Lancaster.
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 Lancaster?
Renewable Energy Systems Property Tax Exemption
Texas Gas Service - Residential Energy Efficiency Rebate Program
Home Improvement (includes attic insulation, duct sealing, duct insulation, duct replacement, high-efficiency gas furnace, and Wi-Fi thermostat: Up to $1000
Solar Water Heater With Natural Gas Backup: $750
Tankless or Super High-efficiency Water Heater: $650
Furnace: $675
Furnace Tune-Up: $40
Natural Gas Dryer with moisture sensor: $225
Natural Gas Dryer Stub: $300
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives mitigate the cost of installing solar panels on your home. This category of financial incentives is intended to encourage more Americans to switch to renewable energy. You may qualify for different types of incentives, including cash back, discounts or monthly utility bill credits, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the Texas government and others from the federal government. Categories of solar incentives include:
- Tax Exemptions: Sales tax exemptions are applied at the point of sale for your solar panels. Property tax exemptions allow you to ignore the value that your solar panels add when calculating how much property tax you need to pay on your house.
- Net Metering: Net metering factors in after your solar panels are up and running. If you've signed a net metering agreement with your Lancaster utility company, it will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some locations, this credit is dollar-for-dollar, while in other places you may get refunded a percentage of the value.
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (This is different from a tax deduction.)
- Rebates: Rebates, or cash back after a purchase, are usually applied prior to any solar tax credits being calculated. These rebates can be provided by your local utility company, by your county or by your state.
Federal Solar Incentives
When you hear the term "solar incentives," federal incentives are likely the first thing that comes to mind. A federal incentive that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a specific percentage of your solar system's cost.
The ITC applies towards solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, accessories, labor and equipment. This credit can apply towards solar panels installed on a primary or secondary residence in the United States that you own. The original claim amount was 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum claim amount.
To find out exactly how much money the ITC could save you, talk to your local Lancaster solar panel installation expert.
In August 2022, the ITC (now called the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. The Clean Energy Credit has increased the current credit up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. After 2032, the credit percentage will see a slight decrease annually until the end of the program in 2035. The expansion also makes it easier to get credit for energy storage systems, starting in 2023.
Click here to learn more about the new Inflation Reduction Act. Your local Lancaster solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it applies to you.
State & Local Solar Incentives
Some solar incentives are often also offered at the local or state level. As with federal incentives, these can include rebates, tax credits and more. The incentives — which may be handled by your county or municipality, or by the state of Texas — might be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Lancaster
The nationwide use of solar energy has gone up significantly in the last 15 years, in part thanks to the increase in availability of solar incentives. You might receive these incentives from your local utility company, the federal government or the Texas government. We suggest talking to your local Lancaster solar installation expert for more information about these incentives and to be sure that you're getting the most money possible for your solar system.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries (coming 2022)
Best Regional Coverage
Momentum Solar
- Great warranty coverage
- Representatives are experts on local policies
- Concierge service ensures steady communication
- Slightly limited service offerings
EcoWatch's Lancaster, TX Solar Incentives FAQs
My home already has solar panels. Are there any incentives that I qualify for?
If your solar panels were installed after January 1, 2022, you may qualify for the recently 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 date of installation. Talking to the company that installed your system, or any local Lancaster solar installer, can help you understand what incentives you can apply for.
What are the best solar panel installation companies near me?
To find the right solar panel installer for you, check out our guide to Lancaster's best solar panel companies.
What are some environmental benefits of installing solar panels on my house?
Solar energy is a renewable energy source — by changing where you get your energy, you can help reduce the strain on our planet's resources. You can also reduce the CO2 emissions from your home by 400 pounds a year, or around 8,000 pounds over 20 years.
When does the federal solar tax credit end?
The federal solar tax credit, formerly known as the ITC and now called the Clean Energy Credit, is set to end January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
Can I apply for incentives both towards the initial cost of solar panels, and later as reimbursement?
The order in which incentives are applied may vary depending on which incentives you are claiming but generally yes, you can claim multiple types of incentives for your solar project. Get in touch with your solar installer or a local tax professional to confirm you are claiming all possible incentives and applying them in the correct order.
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.