2025 Solar Incentives Guide for Sudley, VA - Tax Credits & Rebates

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

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

The phrase "solar incentives" broadly refers to financial incentives that are in place to encourage increased use of renewable energy by making the installation and use of solar panels more affordable. You may be eligible for several types of incentives, including discounts, cash back or monthly utility bill credits, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of Virginia and others from the federal government. Categories of solar incentives include:

• Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
• Rebates: A rebate is a partial refund credited to your account after you've paid for your solar panels. These could be offered by your local utility company, your state or your county. The rebates are usually applied before calculating tax credits.
• Net Metering: Net metering factors in once your solar system is up and running. If you've signed a net metering agreement with your Sudley utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in other areas you may get refunded a percentage of the value.
• Tax Exemptions: These could come in the form of property tax exemptions, which can let you exclude the value of your solar system when paying taxes on your home. They may also include exemptions on sales tax at the time of purchase.
• Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that normally counts as part of your taxable income. In most cases, you must meet a certain (small) threshold of energy production before your solar system qualifies for SRECs or other performance-based incentives. These kinds of incentives are typically handled at the state level.

Federal Solar Incentives

When you think about solar incentives, you likely think of federal incentives first. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit that reduces your taxes by a specified percentage of the money you spend on your solar system.

The ITC covers solar systems installed after January 1, 2006, and under this program you can deduct from your taxes a percentage of the total cost of solar panels, labor, accessories and equipment. This credit can be claimed on solar panels installed on a primary or secondary residence in the United States that you own. The original claim amount was 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum claim amount.

Contacting your local Sudley solar panel installation expert is the best way to understand how the ITC could apply to your situation.

In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now titled the Clean Energy Credit. The Clean Energy Credit runs until 2035. Any solar installation project that is completed between January 1, 2022, and December 31, 2032, may qualify for a 30% tax credit. This amount will decrease slightly each year until the end of the current program. Beginning in 2023, it will also be easier to qualify for credits for energy storage systems under this new program.

Click here to learn more about the new Inflation Reduction Act. Your local Sudley solar panel installation experts can answer your questions and explain how the new Clean Energy Credit will apply to you.

State & Local Solar Incentives

Some solar incentives may be provided at the state and local level. Like with federal incentives, these may include rebates, tax credits and more. Certain incentives are ongoing, while others might only be available for a limited time. These incentives might be provided by your county or municipality, or by the Virginia government.

Next Steps for Installing Solar in Sudley

You can apply for and receive 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 solar adoption nationwide. It is a good idea to talk to your local Sudley solar installation expert for more information about these incentives and to ensure that you're getting the largest number possible for your solar system.