If you’re thinking about solar, you might wonder if it makes sense financially. After all, the initial installation can be quite expensive, and it might take years to recoup that cost through savings on your electric bill. The average solar installation in Massachusetts ranges from $13,132 to $17,768. Fortunately, there are incentives out there to help you save money on your installation, and tax credits make installing solar panels all the more worthwhile. If you’re considering solar panels in Massachusetts or any other state in the U.S., read on to learn more about the available rebates and tax credits.
This article is presented by the solar energy experts at Go Solar MA. If you require additional resources about solar panels or solar power, visit our site at www.gosolarmass.org
Many people are interested in taking advantage of solar power but aren’t sure where to start. If you own your home, you can purchase solar panels, along with an inverter (to make sure it all works correctly) and install it yourself. This is called Do-It-Yourself installation. Alternatively, many states have rebates for residents who get third-party companies involved with their installation process. If you own your home, for example, it’s more cost-effective to hire a company that specializes in solar panels than doing it yourself.
If you don’t own your home, solar panels may not be an option for you (depending on which state you live in). That means another avenue of consideration is installing solar panels on someone else’s roof. This arrangement can be made through a lease, where you would rent out space on another person’s roof to install your panels, or power purchase agreement (PPA), where you pay someone to install your panels but then receive credit for any energy generated.
For homeowners who are interested in solar panels but don’t want to go through all of the installation steps, another alternative is to buy a home that has already gone solar. This could be great for someone interested in moving to a new state or community but doesn’t want to go through the hassle of getting solar panels installed.
There are plenty of ways to get solar panels, whether they’re already installed, leased, or just straight up buying them. For those that aren’t looking to move and don’t have a solar system installed yet, keep reading to see how you can drastically reduce the cost of installing solar panels on your current home.
Federal Tax Credits
Whether you’re a professional or an individual, if you install solar energy panels on your home, you may be eligible for a federal tax credit of 26 percent of qualified expenditures if installed in 2022-2022 and 22 percent for systems installed in 2023. Qualified expenditures include labor costs to design and install equipment. There is no maximum amount that can be claimed.
To be eligible for the federal tax credit your solar system must be installed no later than December 31, 2023. Additionally the solar system must be owned whether it’s through cash or financing. Lastly the system must be new or used for the first time.
Expenses that are included in the tax credit are labor, contractor fees, materials used for equipment and installation, engineering fees, permits and licensing.
State Rebate Programs
Some states have their own rebate programs, which vary by state. Massachusetts, for example, pays a 15% tax credit of up to $1,000 on solar systems. To receive rebates in some areas, you must also enroll in net metering (where credits are calculated based on how much electricity your panels produce versus how much you use).
Not only can you receive tax credits in the form of rebates, but there are plenty of other local benefits as well. In Massachusetts there’s the Solar Massachusetts Renewable Target Program, Solar Installation Property Tax Exemption, and Home Solar Project Sales Tax Exemption.
Each state has a number of requirements that are constantly changing so it’s always best to check with local solar contractors for details about what applies where you live. It’s also worth noting that some states have different deadlines than others, so double-check with your installer on when you should complete your install in order to receive incentives! It will likely vary based on how long it takes them to schedule an installation appointment.
Other Incentives & Financing Options
Taking advantage of every solar incentive and financing option available is essential for anyone looking to cut costs, save money, and keep more cash in their pocket. The cost for solar panels can get pretty high depending on your energy consumption. Not only can you finance through your installer, you may also be able to access a low interest loan through your local government. In Massachusetts, eligible low income homeowners can utilize the Mass Solar Loan Program which gives them access to low interest loans for solar systems.
Benefits of Going Solar
Tax credits, tax deductions, solar rebates, and low-interest financing options all exist to help you recoup some of your investment in a solar energy system. Federal tax credits, for example, can amount to 26 percent of your total solar installation costs. With all these savings on offer it is easy to see why many homeowners consider going solar when considering ways to save money on utility bills each month.
There are plenty of reasons to go solar. From reducing carbon emissions to promoting self-sufficiency, here are some compelling reasons to consider adding a solar system in your home or business:
- Cut down on greenhouse gas emissions by going solar! The electricity you produce with a photovoltaic system is derived directly from sunlight—and not only does it generate power without any harmful pollutants or greenhouse gases in its operation, but it doesn’t rely on burning coal or natural gas either.
- Save money on utility bills! You can expect to see a reduction in your monthly electric bill as soon as you switch from purchasing your power from a utility company to generating it yourself. The more energy you produce with solar panels, of course, the less you will have to buy from your utility provider—and depending on where you live that could amount to big savings.
- Self-sufficiency! Many people are eager to reduce their reliance on public utility companies, either because they want to stop funding expensive projects with their dollars or because they want to become more self-sufficient at home. Regardless of why you are interested in self-sufficiency, installing a solar energy system is one way to achieve it!