Solar Incentives by State

Thanks to the Inflation Reduction Act, the Federal Solar Investment Tax Credit is at 30% until the end 2032 — which is a great start to reducing the cost of your solar system.

However, you may also have access to additional solar incentives from your state, municipality or utility that can reduce the cost of going solar even further. And every penny reduced from your solar cost is a penny saved in energy costs.

Below is a list local solar incentives broken into states. This resource is a work in progress. If you don’t see your state listed below, connect with an Energy Advisor to explore your solar incentives.

Jump to your state:

• California
• Colorado
• Connecticut
• Florida
• Illinois
• Maryland
• Massachusetts
• New York
• New Jersey
• Ohio
• Texas
• Virginia

California Solar Incentives

Due to high energy costs and ample sunshine, California is a great state for solar. In fact, there are relatively few solar incentives in California because solar is already much more affordable than buying electricity from a utility.

Regardless, here are a few California solar incentives to keep an eye on.

State incentives

At the state level, California offers:

• A property tax exemption for the value added by solar equipment
• The Self-Generation Incentive Program (SGIP) rebates for battery storage up to $1,000 per kWh of capacity installed
• Property Assessed Clean Energy (PACE) financing

Local government incentives

We were unable to find solar incentives currently offered through city and county governments – but it’s worth checking with your local government bodies!

Utility incentives

Utility-based solar incentives in California include:

• Rancho Mirage Energy Authority’s $500 rebate
• Sacramento Municipal Utility District’s (SMUD) $150 stipend for residential solar installations

Non-profit incentives

GRID Alternatives is a California-based non-profit that offers no-cost solar installations for qualifying low-income households in disadvantaged communities.

Their solar programs include:

• Single-Family Affordable Solar Homes (SASH)
• Disadvantaged Communities – Single-Family Solar Homes (DAC-SASH)
• The Low-Income Weatherization Program (LIWP)

Related: Free Solar Panels? The Truth Behind the Ads for Free Solar

Colorado Solar Incentives

Colorado passed a clean energy bill in 2023 that included funding to streamline permitting local solar energy projects. This comes in addition to state and local solar incentives.

State incentives

In addition to net metering, Colorado offers:

• 100% sales and use tax exemption for solar and battery technologies
• 100% property tax exemption for the value added by solar and battery technologies
• Low-cost, long-term financing up to $75,000 through the Colorado Residential Energy Upgrade (RENU) Loan

The Colorado Energy Office also runs the Weatherization Assistance Program (WAP) which offers no-cost solar installations to qualifying applicants.

Local government incentives

There are a handful of solar incentives offered through local governments in Colorado to keep an eye on.

First, there’s the Energy Smart Colorado Renewable Energy Rebate available in the Roaring Fork Valley, including Pitkin and Eagle counties, worth 25% of solar costs up to $2,500.

There are similar rebates available to qualifying residents of:

• Boulder County ( up to $200)
• Summit County (up to $1,950)

Keep in mind, local solar rebates are typically distributed on a first come first served basis and often have limited funding!

Utility incentives

A bulk of Colorado’s solar incentives are implemented through the utility providers themselves. The largest provider, Xcel Energy, has a Solar Rewards program that provides an upfront rebate of $1 per watt of solar capacity installed (up to 7 kW).

The following Colorado utilities also offer some form of rebate or rewards program:

• San Miguel Power Association
• Colorado Springs Utilities
• Aspen Electric
• Holy Cross Energy
• La Plata Electric Association
• Black Hills Energy

Connect with an Energy Advisor to explore incentives offered by your utility.

Connecticut Solar Incentives

With the second-highest average electricity price in the US, solar panels offer the potential for massive energy cost savings in Connecticut. With that said, Connecticut isn’t overflowing with solar incentives – but every bit counts.

State incentives

At the state level, Connecticut offers:

• 100% sales and use tax exemption for solar technologies
• 100% property tax exemption for the value added by solar technologies
• The Residential Energy Solutions program

The Residential Energy Solutions program replaced net metering in 2022 and offers solar owners two choices for being compensated for the solar production.

The “netting option” is similar to net metering, but it also includes direct payments for each kilowatt-hour of solar generation. The “buy-all option” involves selling all of your solar production to your utility for on-bill credit compensation based on a flat rate per kWh.

At the time of writing, these appear to be the only solar incentives available in Connecticut, although it’s worth checking with your local government and utility provider.

Florida solar incentives

With abundant sunshine and a booming rooftop solar industry, Florida is an ideal place for going solar. A sprinkling of state and local incentives are just the cherry on top.

State incentives

At the state level, Florida offers:

• A property tax exemption for 100% of the value added by solar and/or battery storage
• A sales tax exemption for solar energy systems
• Property Assessed Clean Energy (PACE) financing
• Net metering at the retail rate

Local government incentives

A few local governments in Florida offer solar incentives to help their residents go solar. This programs include:

• Boynton Beach Energy Edge Rebate program (up to $1,500)
• Dunedin Solar Energy Grant Program (up to $2,500)

Illinois Solar Incentives

Illinois is a perfect example of how solar incentives can make solar attractive in states without exceptionally high electricity prices and/or year-round sun. Notably, launching the Adjustable Block Program in 2019 made solar more financially beneficial and sparked residential, utility, and community adoption.

State incentives

Solar incentives offered by the state of Illinois include:

• Special property value assessments for homes with solar energy systems, so the value added by solar won’t raise your property taxes
• 1-to-1 net metering
• Illinois Solar for All – a no-cost solar program reserved for eligible low-income homeowners
• The Adjustable Block Program (ADP), which awards participants one renewable energy credit (REC) for every 1,000 kWh of solar production for 15 years, which can be sold on marketplaces for cash.

According to the Illinois Power Agency’s REC Payments calculator, a residential solar system producing 10,000 kWh per year in program year 2023-2024 would earn between $10,000 and $12,000 over 15 years.

Maryland Solar Incentives

Maryland has a handful of solar and battery incentives that can substantially reduce the cost of these home upgrades and maximize energy cost savings.

State incentives

A bulk the solar incentives available in Maryland are offered through state legislation and programs. They include:

• Exemption from Maryland’s 6% sales tax for purchases of solar energy equipment
• A 100% property tax exemption for the home value added by solar energy equipment
• One-to-one net metering
• The Residential Clean Energy Rebate worth $1,000 (which pending legislation seeks to increase to $5,000)
• The Energy Storage Income Tax Credit worth 30% of the total cost of battery, with a $5,000 cap (which can be combined with the 30% federal battery tax credit)
• Solar Renewable Energy Credits (SRECs) worth $57.50 per 1,000 kWh of solar production, as of March 2023

The value of SRECs fluctuates over time, but at the current rate an average system producing 7,000 kWh per year would earn over $400 per year.

Local government incentives

In addition to the state property tax exemption, there are a handful of counties that offer local property tax credits worth up to $5,000 per year. These include:

• Baltimore County
• Anne Arundel County
• Prince George’s County
• Harford County

Consult a licensed tax advisor to make a gameplan for claiming these local incentives.

Massachusetts Solar Incentives

Massachusetts solar incentives include a state tax credit and rebate program, in addition to generous municipal rebate programs. As always, homeowners are encouraged to take advantage of these incentives now, as program funding tends to decline over time.

State incentives

At the state level, Massachusetts offers:

• 100% sales tax exemption on solar purchases
• 100% solar property tax exemption for 20-years
• The Solar Massachusetts Renewable Target (SMART) rebate program
• A state tax credit worth 15% of project costs, up to $1,000
• A strong 1-1 net metering policy

Combined with 30% federal solar tax credit and some of the highest electricity prices in the nation, Massachusetts offers some of the best solar savings potential in the US.

Utility incentives

Massachusetts also boasts a number of municipal rebate programs that can be combined with state and federal incentives to take a big bite out of solar costs.

Municipal utilities with rebate programs include:

• Ipswich Electric Light Department
• Shrewsbury Electric & Cable Operations
• Wakefield Municipal Gas and Light Department
• Reading Municipal Light Department
• Hudson Light & Power
• Concord Municipal Light and Power
• Taunton Municipal Lighting Plant

New York Solar Rebates

New York may be the best state for solar in terms of incentive programs available to homeowners. In most scenarios, you can cover over half of your project costs covered by some form of incentive.

https://youtu.be/8WamQosyO9Y

State incentives

At the state level, New York offers a wide range of solar incentives, including:

• A state tax credit worth 25% of solar costs, up to $5,000
• The NYSERDA rebate worth 20-30 cents per watt, depending on where your live
• Sales tax exemption on solar equipment
• 15-year property tax exemption on the value solar adds to your home
• Two quality options for net metering

Combined with the 30% federal tax credit and higher-than-average utility rates, rooftop solar can substantially reduce energy costs for homeowners in New York State.

Local government incentives

Zooming into the local level, New York City has a quite favorable property tax abatement worth 20% of the cost of going solar applied against property taxes over four years, in addition to its own sales tax exemption.

Utility incentives

PSEG Long Island offers a battery rewards program for customers that discharge their solar-powered batteries during peak demand events during the summer.

New Jersey Solar Rebates

New Jersey has perhaps the most valuable incentive in the US with its Successor Solar Incentive (SuSI). Combined with the federal solar tax credit, Garden Staters can reduce their solar costs by well over 50%.

State incentives

At the state level, New Jersey offers:

• 100% solar sales tax exemption
• 100% property tax exemption for the value added by solar PV systems
• New Jersey Successor Solar Incentive Program (SuSI)

In the SuSI program, solar owners can earn and sell SREC-IIs worth $85 for each MW of electricity their system produces for 15 years. With an average system producing ~8 MW per year, that adds up to $680 per year and $10,200 over 15 years.

Ohio solar incentives

According to the Office of the Ohio Consumers’ Counsel, Ohio is home to over 200 solar companies and is poised for rapid growth int he 2020’s. In addition to the 30% federal solar tax credit, the state offers a handful of incentives to enourage homeowners to fuel the state’s growing solar industry.

State incentives

At the state level, Ohio offers:

• Net metering, although exact policies vary by utility
• Solar Renewable Energy Credits (SRECs)
• Sales and property tax exemptions*
• Low-cost solar financing through the ECO-Link program

*Consult a licensed tax professional regarding tax exemptions in your state.

Local government incentives

There are a few solar incentives offered at the city and county level that can further reduce the cost of solar. These include:

• Local property tax exemptions in Cleveland and Cincinnati, which prevent the value added by your solar system from increasing your proerty taxes
• Low-interest financing through the Hamilton County Home Improvement Program

Connect with an Energy Advisor to see if solar makes sense for you in Ohio.

Texas solar incentives

With ample sunshine and little shade, Texas is tailor-made for rooftop solar. However, most incentives are implemented at the local and utility level as opposed to the state level, so it’s worth taking an extra minute to research incentives for your area.

State incentives

The only state-level solar incentive offered in Texas is a property tax exemption for the value solar energy systems add to your home. Homeowners are required to submit Form 10-123 to claim this exemption.

Local government incentives

The City of Sunset Valley offers a rebate of $1.00 per Watt of solar capacity installed, up to $3,000.

We were unable to finding additional local government incentives, but it’s worth checking if your city and/or county has any!

Utility incentives

Most solar incentives in Texas are distributed at the utility level. These include:

• The Austin Energy Rebate worth $2,500
• San Marco Electric Utility (SMTX) solar PV rebate worth up to $2,500
• AEP Texas North Company SMART Source Solar PV Program rebate worth up to $6,000
• AEP Texas Central Company SMART Source Solar PV Program rebate worth up to $5,000
• Oncor Electric Delivery Residential Solar Program rebates (must pair solar panels with energy storage)
• Garland Power & Light buys back excess solar production for $0.0669 per kWh
• Denton Municipal Electric (DME) solar rebate with an average award amount of $4,000
• New Braunfels Utilities solar rebate worth up to $3,000

If you don’t see your utility listed, connect with an Energy Advisor to explore incentives in your area.

Virginia solar incentives

Virginia offers a sprinkling of solar incentives in addition to the 30% federal solar tax credit that can make rooftop solar more affordable than buying electricity from a utility provider.

State incentives

• Residential property tax exemption (value of solar won’t increase your proerty taxes)
• Net metering compenstated at the full retail value
• A strong market for Solar Renewable Energy Credits (SRECs)

Virginia established a Renewable Portfolio Standard requiring 100% renewable electricity by 2050, fueling demand for SRECs to help achieve that goal.

Although SREC prices are capped at $75, the market value of $55 in June 2023 would yield $400-500 per year for the average residential system.

Local and utility incentives

There doesn’t appear to be any solar incentives offered at the local and utility levels in Virgina, but it’s worth checking with your city, county, and utility provider!

Didn’t see your state?

This resource is a work in progress and does not yet feature every state and solar incentive yet.

If you don’t see your state above, connect with an Energy Advisor to explore the incentives that can reduce the cost of your solar system and increase your energy cost savings.