2025 Solar Incentives Guide for Santa Fe, TX - Tax Credits & Rebates

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

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

Solar incentives are intended to encourage homeowners to switch to renewable energy by offering incentives that lower the financial burden of solar panel installation and use. Solar incentives may include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are provided by the federal government, some by the state of Texas and some by your utility company, county or municipality. Some solar incentives you might qualify for are:

• Rebates: Rebates, or partial refunds after a purchase, are typically applied before any solar tax credits are calculated. These rebates can be offered by your local utility company, by your state or by your county.
• Net Metering: Don't forget to talk to your Santa Fe utility company about signing a net metering contract. This allows you to receive credit towards your monthly utility bill for the value of excess energy your solar panels generate. You could receive either a dollar-for-dollar credit or a percentage of the value.
• Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the federal government.
• Tax Exemptions: Sales tax exemptions are effective at the time of purchase for your solar system. Property tax exemptions let you ignore the added value of your solar system when you calculate how much property tax you need to pay on your house.

Federal Solar Incentives

When you hear the term "solar incentives," federal incentives are likely the first thing that comes to mind. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a specified percentage of the cost of your solar system.

The ITC is applied to the total cost of solar panel installation, including the panels themselves as well as equipment, accessories and labor. This credit can be claimed for panels installed after January 1, 2006, on a primary or secondary residence that you own and that is located in the United States. The tax credit ranges from 26-30% of total costs depending on when your project was completed. There is no maximum claim amount.

Reaching out to your local Santa Fe solar panel installation expert is the best way to understand how the ITC applies to you.

In August 2022, the Inflation Reduction Act expanded and extended the ITC, now called the Clean Energy Credit. 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. At this point, the credit percentage will decrease slightly each year until the end of the program in 2035. Starting in 2023, the expansion to the program will also make claiming credit for energy storage systems easier than ever before.

More information about the new Inflation Reduction Act can be found here. Your local Santa Fe solar panel installers are the best people to answer your questions about the new Clean Energy Credit and how it may apply to you.

State & Local Solar Incentives

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

Next Steps for Installing Solar in Santa Fe

The nationwide use of solar energy has increased enormously in the last 15 years, in part due to the growth in the number of solar incentives. You can obtain these incentives from your local utility company, the federal government or the Texas government. It is a good idea to talk to your local Santa Fe solar installation company to learn more about these incentives and to be sure that you're getting the largest number possible for your solar system.