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

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

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

The term "solar incentives" includes a wide range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Different types of incentives, such as cash back, discounts or credit towards your monthly utility bill, may be available to you. Some incentives may be offered by the state of Texas, by your utility company or by county or municipality, while other incentives are federal. You might qualify for any of the following types of solar incentives:

• Tax Exemptions: Tax exemptions may come in two forms. The first is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption. This allows you to ignore the value added by your solar system when paying property tax on your home.
• Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
• Net Metering: Net metering factors in after your solar system is up and running. If you've signed a net metering agreement with your Odessa utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some places, this credit is dollar-for-dollar, while in other places you might be refunded a percentage of the value.
• Rebates: Rebates, or partial refunds after a purchase, are normally given prior to any solar tax credits being calculated. Rebates may be provided by your local utility company, by your county or by your state.

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Federal Solar Incentives

When you hear the term "solar incentives," federal incentives may be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is the most commonly known federal solar incentive. The ITC provides you with a tax credit for a set percentage of the cost of your solar system.

The ITC can be credited towards the value of a solar system installed on your primary or secondary residence in the United States. The solar system must have been installed after January 1, 2006, on a property you own for you to claim the credit. Initially, the ITC applied to 30% of all costs (panels, labor, accessories and equipment), although the amount has fluctuated slightly over the last few 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 amount you can claim.

Have questions about how the ITC applies to your specific situation? Get in touch with your local Odessa solar panel installer to get more information.

In August 2022, the ITC (now titled the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. With the new provisions, solar installation projects begun after January 1, 2022, and finished by December 31, 2032, may be eligible for a 30% tax credit. This percentage will then see a slight annual decrease until the current Clean Energy Credit expires in 2035. The program 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 Odessa solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it applies to you.

State & Local Solar Incentives

There are more than just federal solar incentives; tax credits, rebates and more may be offered at the state and local level. These solar incentives — which may be given by your county or municipality, or by the state of Texas — may be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Odessa

There are many types of solar incentives: those given by local utility companies, those offered by the federal government and those given by the Texas government, to name a few. The use of solar energy has grown tremendously in the last 15 years, partially thanks to these incentives. If you're prepared to make the change to solar energy, reaching out to your local Odessa solar panel installation expert is a great first step.