2024 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 2024 and beyond)
- Ways to optimize your solar investment
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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
Source: https://www.dsireusa.org/
Solar incentives are designed to make renewable energy usage more affordable through financial incentives to help people install solar panels on their homes. Various kinds of incentives, such as cash back, discounts or credit towards your monthly utility bill, may be available to you. Certain incentives may be offered by the Virginia government, by your utility company or by county or municipality, while other incentives are federal. Some solar incentives you might qualify for are:
- Rebates: Rebates, or cash back after a purchase, are normally applied before any solar tax credits are calculated. Solar rebates may be offered by your local utility company, by your state or by your county.
- Net Metering: Net metering becomes relevant after your solar panels are up and running. If you have a net metering agreement with your Fredericksburg utility company, it will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some locations, this is a dollar-for-dollar credit, while in other areas you might make back a percentage of the value.
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
- 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, a certain (small) threshold of energy production must be met before your solar system is eligible for SRECs or other performance-based incentives. Incentives like these are generally handled at the state level.
- Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar system. Property tax exemptions allow you to exclude the added value of your solar system when you calculate the amount of property tax you need to pay on your house.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries
Best Technology
Tesla Energy
- 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
Federal Solar Incentives
Federal solar incentives are likely to be the first thing that comes to mind when thinking about solar incentives. A federal incentive many people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a predetermined percentage of your solar system's cost.
The ITC can be applied to the total cost of solar panel installation, including the panels themselves as well as labor, accessories and equipment. This credit can be claimed for panels installed after January 1, 2006, on a primary or secondary residence located in the United States that you own. 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 will apply to you, get in touch with your local Fredericksburg solar panel installation expert and ask for more information.
In August 2022, the Inflation Reduction Act made revisions to the ITC, now referred to as the Clean Energy Credit. Homeowners can now qualify for a credit equal to 30% of the total costs of solar system installation for projects that began after January 1, 2022, and will be finished by the end of 2032. The percentage will then begin to decrease on a yearly basis until the Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems with the new act.
Click here to learn more about the new Inflation Reduction Act. To better understand how the new Clean Energy Credit will apply to you, talk to your local Fredericksburg solar installation expert.
State & Local Solar Incentives
Some solar incentives may be offered at the local or state level. Similar to federal incentives, these may include tax credits, rebates and more. Some incentives are ongoing, while others might only be available for a limited time. Solar incentives may be given by your county or municipality, or by the Virginia government.
Next Steps for Installing Solar in Fredericksburg
The expanding number of solar incentives available has enormously increased the adoption of solar energy nationwide over the past 15 years. You might qualify for solar incentives from the Virginia government, the federal government or your local utility company. If you're prepared to switch over to solar energy, calling your local Fredericksburg solar panel installation expert is an excellent place to start.
EcoWatch's Fredericksburg, VA Solar Incentives FAQs
How do 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 run by the Virginia government or by your county/municipality, sometimes have additional qualifications. Get in touch with your local Fredericksburg solar installer to find out what incentives your project may qualify for.
My home already has solar panels. Does my system qualify for any incentives?
An excellent idea would be to talk to someone from the company that installed your solar system – or get in touch with a local Fredericksburg solar installer — to learn about which incentives you may qualify for. If your solar panels were installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar panels installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
When does the federal solar tax credit end?
The federal solar tax credit, previously called the ITC and now titled the Clean Energy Credit, is set to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
Can I qualify for incentives both towards the up-front cost of solar panels, and later as reimbursement?
Yes, you can claim both rebates and tax credits towards the cost of your solar panels. Depending on precisely which incentives you are receiving, they may apply in a different order. Be sure to 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.