2023 Solar Incentives Guide for Watertown, WI - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Watertown.
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 May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Watertown?
Renewable Energy Sales Tax Exemptions
Renewable Rewards Program
Business - 0-5 kW: $200 per kW
5-10 kW: $1000 + $150 per kW over 5
10-100 kW: $1750 + $125 per kW over 10
100-300 kW: $13000 + $100 per kW over 100
300-500 kW: $33000 + $85 per kW over 300
Biogas, Solar, and Wind Energy Equipment Exemption
Federal Residential Renewable Energy Tax Credit
The term "solar incentives" refers to a wide range of financial incentives implemented to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. You may be eligible for various kinds of incentives, including cash back, discounts or credit towards your monthly utility bill, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the Wisconsin government and others from the federal government. Some solar incentives you might qualify for are:
- Net Metering: Net metering factors in once your solar system is up and running. If you have in place a net metering agreement with your Watertown utility company, the company will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some locations, this credit is dollar-for-dollar, while in other places you might make back a percentage of the value.
- Tax Exemptions: Tax exemptions may come in two forms. First, there is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption, which allows you to ignore the added value of your solar system when paying property tax on your house.
- Rebates: A solar rebate is a partial refund after the purchase of your solar panels. These could be offered by your local utility company, your county or your state. The cash back that you get from the rebates is normally applied before tax credits are calculated.
- Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (A tax credit is different from a tax deduction.)
Federal Solar Incentives
When you hear the term "solar incentives," federal incentives are likely the first thing that comes to mind. An 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 the cost of your solar system.
The ITC applies towards solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, equipment, labor and accessories. This credit can apply towards solar panels installed on a primary or secondary residence that you own in the United States. Originally, you could claim 30% of the total cost, although certain projects may qualify for only 26%, depending on the details. There is no maximum amount you can claim.
To more fully understand how the ITC may apply to your situation, speak to your local Watertown solar panel installation expert and ask for more information.
In August 2022, the ITC (now titled the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. For solar systems installed between January 1, 2022 and December 31, 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. Starting in 2023, it will also be easier to qualify for credits for energy storage systems with the new act.
Click here to learn more about the new Inflation Reduction Act. The best way to understand how the new Clean Energy Credit applies to you is to get in touch with your local Watertown solar panel installation expert.
State & Local Solar Incentives
Tax credits, rebates and more can be claimed at multiple levels. On top of federal solar incentives, there are often state and local ones as well. Some incentives are ongoing, while others are offered for only a limited time. Your local solar incentives could come from your county or municipality, or from the Wisconsin government.
Next Steps for Installing Solar in Watertown
Solar incentives may be provided by the federal government, the Wisconsin government or your local utility company. The growing number of available solar incentives has facilitated the nationwide growth of solar energy use in the last 15 years. Talking to your local Watertown solar panel installation company is an excellent first step towards getting the most money possible when you switch to solar energy.
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EcoWatch's Watertown, WI Solar Incentives FAQs
How much can I save on my electric bill annually if I add solar panels to my Watertown home?
Typically, homeowners in Watertown who install solar panels save approximately $1,072.55 per year, or approximately $20,378.38 over 20 years after they make the switch.
What are the top solar panel installation companies near me?
To find the top solar panel installation companies near you, take a look at our article on Watertown's top solar panel companies.
I want to switch my appliances out for ones that are more energy-efficient. Are there any incentives I can get?
With the passage of the new Inflation Reduction Act, there are a number of new financial incentives that are available when you make eco-friendly improvements to your home. More details about these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I receive incentives both towards the initial cost of solar panels, and later as reimbursement?
The order that incentives will be applied in might vary depending on which incentives you are claiming but usually yes, you can claim multiple types of incentives for your solar project. Get in touch with your solar installer or a local tax professional to be sure you are claiming all possible incentives and applying them in the correct order.
Can I use multiple types of renewable energy to power my home?
Yes, you can employ multiple types of renewable energy to power your home — for example, a combination of solar and wind power. You can also combine renewable energy generation with a backup source of non-renewable energy. Make sure that you discuss your plan with your local Watertown solar panel installer, to get an understanding of what will be needed and what kinds of incentives you might or might not qualify for.
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.