30% Federal Income Tax Credit (ITC)
Homeowners across the United States may claim a tax credit of 30% of the cost of a solar electric system installed on a dwelling unit located that is owned by the taxpayer. The building does not have to be the homeowner’s principal residence but does have to be in the United States. Costs may include labor costs for on-site preparation, assembly or original system installation, and for wiring to interconnect the system to the home. If the credit earned by the system exceeds a single years tax liability, the excess credit may be carried forward to the following taxable year. Currently this tax credit is set to expire December 31, 2016.
For a complete list of state and local incentives across the U.S. please visit DSIRE
Under the Federal Modified Accelerated Cost-Recovery System (MACRS) businesses may recover investments in solar equipment through depreciation deductions. Solar equipment is classified as five-year property under the MACRS program. Learn more about this equipment depreciation program here.
In 2005, Washington State enacted I-937 and Senate Bill 5101 to promote the development of a local solar industry, including new jobs and clean, renewable power generation. Today, Washington has some of the most progressive solar incentives in the United States. You can receive up to $5,000 annually in incentives from your local power company and sales tax exemptions when you purchase itek Energy solar equipment that is made in Washington State. These Washington State incentives, in addition to the Federal Incentives, making going solar more affordable than ever!
Contact your local solar installer to learn about the incentives in your area and how you can make the sun work for you!
Washington Sales Tax Exemption
Solar energy systems that are 10kW or smaller are 100% exempt from sales and use tax. This exemption includes machinery and equipment used directly in the solar energy system as well as installation charges. This incentive is set to expire on June 30, 2018.
Solar energy systems that are 10kW or larger are eligible for a 75% refund of the sales and use tax paid for the machinery, equipment and installation of the system. This incentive is set to expire on January 1, 2020.
Washington State Solar Production Incentive and Net Metering
Solar systems installed with both Washington built panels and inverters qualify to receive payments of $0.54/kWh produced up to $5000 per year.
In addition to being paid $0.54/kWh, your power bill will be reduced by the amount of power your system produces. If your system produces more than what your home consumes the utility will credit your account for the power you added to the grid. Credits can be carried from month to month but will reset at the end of the utilities annual billing cycle.
The savings can be even better for businesses talk to an installer in your area to learn why.
In addition to the Washington State production based incentive many local PUD’s are offering their own production-based incentives. To learn what local incentives are available in your area check with your local PUD or utility. Local incentives can also be found on the Washington State section of the dsire.org website.
Property Value Increase
A study published by Lawrence Berkeley National Laboratory compared California home sale prices for homes with solar energy systems to those that did not. The study’s data set was over a 8 1/2 time frame using a 3.1 kW average system size and found that on average solar homes went for $17,000 more than their non-solar counterparts. A general rule of thumb is that any home improvement that lowers your electricity bills by $1000 annually will increase a home’s value by about $20,000.
On January 20, 2015 the Minnesota Department of Commerce announced that itek’s Made-in-Minnesota certification will allow local customers a production incentive of $0.28 /kWh for residential solar installations, $0.15/ kwh for Commercial Tax Exempt/Nonprofit/Government and $.13/kWh for commercial for profit projects. To view details and find more information please visit the Minnesota Department of Commerce website.
The State of Minnesota launched its Solar Incentive Program in 2014. The 10 year, $15 million per year program was one of several initiatives enacted by the 2013 legislature to increase deployment of solar energy throughout the state in order to help meet its Renewable Portfolio Standards. These standards call for 1.5% of electric sales from investor–owned utilities to come from solar electricity by the year 2020. The program is intended to boost the state’s solar market as well as make solar more affordable for Minnesota residents and businesses.
Minnesota Solar PV Production Incentives are available to customers of these investor-owned utilities:
Solar modules installed must be certified as Made–in–Minnesota.
Systems must be less than 40kW (kilowatts) to qualify.
Applications must be received between January 1 – February 28 each year through 2023 and are selected by lottery.
Incentives for solar PV are performance-based, established by a system’s energy production, and paid over 10 years. Owners of an approved and installed PV system will receive payments annually by July 1st based on the kWh output of the system in the previous calendar year.
The structure for payments to the customer is based on the amount of kilowatt hours (kWh) produced annually for 10 years. By March 1st each year, the participating utility in which the solar PV system is interconnected with will annually record and submit to the Department of Commerce a record of the energy produced by the system from January 1 – December 31. The Department of Commerce will use the amount of energy produced to calculate a PBI amount and send a check to the customer by July 1st. Renewable Energy Credits (REC) associated with the energy provided to the utility for which an incentive payment is made belong to the utility.
For more information please visit the Made-in-Minnesota webpage. Applications for the solar electric incentives and solar thermal rebates will be posted on that webpage.
Questions can be directed to the Department of Commerce Energy Information Line: 651-539-1886 or toll free at 1-800-657-3710. Or email questions to email@example.com