2023 Solar Incentives Guide for Chester, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Chester.
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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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Chester?
Income Tax Deduction for Energy-Efficient Products
Local Option- Renewable Energy Machinery and Tools Property Tax Exemption
Local Option - Residential Property Tax Exemption for Solar
Federal Residential Renewable Energy Tax Credit
The phrase "solar incentives" refers broadly to financial incentives put in place by solar companies and the government to encourage the use of renewable energy by making solar panels more affordable. You might be eligible for several kinds 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 Virginia government and others from the federal government. Some broad categories of solar incentives include:
- Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for money that normally counts as part of your taxable income. Typically, there is a small threshold of energy production to meet before your solar system can earn SRECs or other performance-based incentives. Incentives like these are generally handled by your state government.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
- Net Metering: Be sure to talk to your Chester utility company about signing a net metering agreement. This will allow you to receive credit towards your utility bill every month 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 Exemptions: These may come in the form of property tax exemptions, which can let you exclude the value of your solar system when paying property tax on your home. You may also qualify for an exemption on sales tax at the time of purchase.
- Rebates: Solar rebates may be offered by your local utility company, or by your state or county. These rebates work as cash back that is applied after your purchase of a solar system and before tax credits are calculated.
Federal Solar Incentives
Federal solar incentives are likely the first thing that you think of when thinking about solar incentives. You might have heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a certain percentage of the money you spend on your solar system.
The ITC is applied to the total cost of solar system installation, including the panels themselves as well as equipment, accessories and labor. You can claim this credit for panels installed after January 1, 2006 on a primary or secondary residence that you own, as long as it is located in the United States. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum amount you can claim.
To better understand exactly how much money the ITC could save you, speak with your local Chester solar panel installer.
The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as retitling it the Clean Energy Credit). For solar systems installed between January 1, 2022 and December 31, 2032, homeowners can apply for a credit for 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit ends 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. The best way to fully understand how the new Clean Energy Credit applies to you is to get in touch with your local Chester solar panel company.
State & Local Solar Incentives
Not all solar incentives are federal; rebates, tax credits and more are often offered at the state and local level. Incentives might be provided by the state of Virginia, 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 Chester
The variety of available solar incentives has contributed greatly to the increase in the nationwide adoption of solar energy over the last 15 years. You can get solar incentives from your local utility company, the federal government or the Virginia government. Speaking with your local Chester solar panel installation expert is a great first step towards getting all the incentives you qualify for when you switch to solar energy.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries (coming 2022)
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
EcoWatch's Chester, VA Solar Incentives FAQs
My home already has solar panels installed. Do I qualify for any incentives?
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 may qualify for a tax credit between 26% and 30%, depending on the year it was installed. Talking to the company that installed your system, or any local Chester solar installer, can help you learn more about what incentives you qualify for.
How much will a solar system save me annually on my electric bill in Chester?
On average, homeowners in Chester who install solar panels save about $934.76 per year, or about $17,760.52 over 20 years after making the switch.
What are some environmental benefits of installing solar panels on my house?
You can lower your carbon footprint by 300 pounds of CO2 annually when you install solar panels. This adds up to roughly 6,000 pounds over 20 years. In addition, solar power is a renewable energy source, meaning that switching your home over reduces the drain on our planet's resources.
How long until the federal solar tax credit ends?
The Clean Energy Credit (previously called the federal solar tax credit, or the ITC), is scheduled to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I receive incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order in which incentives are applied could vary depending on which incentives you are claiming but generally yes, you can receive multiple types of incentives for your solar project. Speak to your solar installer or a local tax professional to verify you are claiming all the incentives you are eligible for 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.