2023 Solar Incentives Guide for Fredericksburg, VA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Fredericksburg.
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.
Get a free quote from one of our trusted Fredericksburg solar installers to see how much you can save.
Please enter a valid 5-digit zip code!
Why you can trust EcoWatch
What Solar Tax Credits, Incentives, and Rebates are Available in Fredericksburg?
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 to help people install solar panels on their homes. You might be eligible for various kinds of incentives, such as discounts, cash back or credit towards your monthly utility bill, 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. Types of solar incentives might include:
- Rebates: Rebates, or cash back after a purchase, are normally applied before any solar tax credits are calculated. Rebates can be provided by your local utility company, by your county or by your state.
- Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives may be available to you if your solar system produces more than a specified (usually small) amount of electricity. These types of incentives are typically handled by the state government. You can sell your SRECs to your utility company or other buyers, and the money you make is usually considered part of your taxable income.
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the federal government.
- Tax Exemptions: Your solar panel system could qualify for exemptions on both sales and property tax. Sales tax exemptions are applied at the time of purchase. Property tax exemptions allow you to ignore the added value of the solar panels when calculating property taxes on your house.
- Net Metering: Net metering factors in once your solar system is up and running. If you have a net metering agreement with your Fredericksburg utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some areas, this credit is dollar-for-dollar, while in other places you might be refunded a percentage of the value.
Federal Solar Incentives
Federal solar incentives are likely the first thing that comes to mind when thinking about solar incentives. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a percentage of your solar system's cost.
The ITC is applied to the total cost of solar panel installation, including the panels themselves as well as labor, accessories and equipment. You can claim this credit 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.
To best understand how the ITC could apply to you, contact your local Fredericksburg solar panel installation expert and request more information.
The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as retitling it the Clean Energy Credit). For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners can receive a credit for 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit expires in 2035. The program expansion also makes credits for energy storage systems even easier to claim, starting in 2023.
More information about the new Inflation Reduction Act can be found here. To best understand how the new Clean Energy Credit will apply to you, get in touch with your local Fredericksburg solar installation expert.
State & Local Solar Incentives
Not all solar incentives are federal; rebates, tax credits and more might also be offered at the state and local level. The incentives — which may be given by your county or municipality, or by the state of Virginia — may be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Fredericksburg
You can apply for solar incentives from the federal government and the Virginia government, as well as from your local utility company. The growing availability of solar initiatives over the last 15 years has helped increase nationwide solar energy use enormously. Speaking with your local Fredericksburg solar panel installer is the best first step towards making sure you get all the incentives you qualify for when you switch to solar energy.
EcoWatch's Fredericksburg, VA Solar Incentives FAQs
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.