2023 Solar Incentives Guide for Danville, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Danville.
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 Danville?
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
Solar incentives are designed to make renewable energy usage more affordable via financial incentives for individuals who install solar panels on their homes. Solar incentives can include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are offered by the federal government, some by the Virginia government and some by your utility company, county or municipality. Categories of solar incentives include:
- Rebates: A solar rebate is a partial refund after the purchase of your solar system. These could be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
- Tax Credits: Tax credits lower, dollar-for-dollar, how much income tax you owe the government. These are different from tax deductions.
- Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives might be available to you if your solar system produces more than a specified (usually small) amount of electricity. Performance-based incentives are typically handled by the state government. You can sell SRECs to your utility company or other buyers, and the money you make is normally considered part of your taxable income.
- Tax Exemptions: Your solar system could qualify for exemptions on both sales and property tax. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions allow you to exclude the added value of the solar panels when calculating property taxes on your home.
- Net Metering: You may be able to sign a net metering contract with your Danville utility company. This agreement may apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then deduct this value from your utility bill each month.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some familiarity with. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a predetermined percentage of the cost of your solar system.
The ITC can be credited towards the value of solar panels installed on your primary or secondary residence in the United States. The solar panels must have been installed on a property you own after January 1, 2006 for you to claim the credit. Originally, the ITC covered 30% of all installation costs (panels, labor, accessories and equipment), although this amount has fluctuated 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.
Your local Danville solar panel installer can provide you with more information about the ITC and how it may apply to your situation.
The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. Now, 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 decrease slightly each year until the end of the current Clean Energy Credit in 2035. Starting in 2023, the expansion to the program will also make it easier to get credit for energy storage systems.
Click here to learn more about the new Inflation Reduction Act. Your local Danville solar panel installation experts can answer your questions and explain how the new Clean Energy Credit applies to you.
State & Local Solar Incentives
There are often also state solar incentives in addition to those provided by the federal government. Tax credits, rebates and more can be offered at a more local level. These incentives — which may be given by the state of Virginia, or by your county or municipality — might be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Danville
The variety of solar incentives available has enormously increased the use of solar power nationwide over the past 15 years. You may receive solar incentives from the federal government, the Virginia government or from your local utility company. When you're ready to make the switch to solar energy, talking to your local Danville solar panel installation expert is a great first step.
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 Danville, VA Solar Incentives FAQs
Can I claim incentives for adding solar panels to a rental property, vacation home or commercial property?
While we recommend speaking with your local solar installer and/or tax professional to best understand what solar incentives apply to you, many incentives will apply to a second home, so long as that home is in the United States and owned by you. There may be other incentives available for commercial properties specifically, depending on the specifics.
How can I learn if I qualify for different solar incentives?
Broadly, solar incentives apply to:
- a new solar panel system
- installed on property you own
- within the U.S.
- between the dates specified by a particular incentive.
Specific incentives, including those given out by the Virginia government or by your county/municipality, may have additional qualifications. Talk to your local Danville solar installer to find out what incentives your project may qualify for.
How much can I save on my electric bill annually if I add solar panels to my Danville home?
When you add solar panels to your house in Danville, you can anticipate savings of approximately $1,015.88 per year, or approximately $19,301.80 over 20 years.
What are the environmental benefits of switching to solar energy?
You can lower your carbon footprint by 500 pounds of CO2 a year when you switch to solar panels. This adds up to approximately 10,000 pounds in 20 years. Solar is also a renewable energy source, which means that making the switch lessens the drain on our planet's resources.
Can I receive incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can claim both tax credits and rebates towards the cost of your solar panels. Depending on precisely which incentives you are applying for, they may apply in a different order. Make sure that you speak with your solar installer or a local tax professional to confirm that you are claiming the correct incentives and getting the most money possible.
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.