Investing in solar panels for your home or business can be a significant upfront expense, but there are various forms of financial support and incentives available to help offset the cost and make solar energy more accessible. Here are some common forms of financial support to purchase solar panels:
- Solar Tax Credit:
A tax credit is a dollar-for-dollar reduction in the amount of income tax a homeowner would owe. Solar PV systems installed in 2020 and 2021 are eligible for a 26% tax credit, meaning 26% of the cost of the solar PV installed is taken off the tax amount owed from the qualifying household. In August 2022, the Investment Tax Credit (ITC) amount was increased to 30% for any installation completed between 2022 and 2032. Over the next 8 years, all solar installations are eligible for 30% return on investment and there is no maximum amount that can be claimed when filing for a 30% ITC. Read more about the Investment Tax Credit here: Homeowner’s Guide to the Federal Tax Credit for Solar Photovoltaics | Department of Energy - Solar Loans and Financing:
Solar Loans: Some financial institutions offer special solar loans or energy-efficient home improvement loans with favorable terms for solar panel installations. These loans can help spread the cost over time. Property Assessed Clean Energy (PACE) Programs: PACE programs allow property owners to finance energy-efficient upgrades, including solar installations, through property tax assessments. - Solar Leasing and Power Purchase Agreements (PPAs):
Solar Leasing: With solar leasing, you can lease solar panels from a provider and pay a fixed monthly amount, typically lower than your current electricity bill. The leasing company owns and maintains the system. Power Purchase Agreements (PPAs): Similar to leasing, PPAs involve purchasing the electricity generated by a solar system on your property at a predetermined rate, often lower than utility rates.
Before deciding on a specific form of financial support, it's essential to research the options available in your area, consider your financial situation, and evaluate the long-term benefits of solar panel installation. The Solar for All NOLA installers will present you with your financing options so you can determine the most suitable financing method for your needs.
