2024 Solar Incentives Guide for Covington, KY - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Covington.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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What Solar Tax Credits, Incentives, and Rebates are Available in Covington?
Duke Energy - Residential Efficiency Rebate Program
Central Air Conditioning or Heat Pump: up to $400/unit
Geothermal Heat Pump: $400/unit
Variable Speed Pool Pumps: $300/unit
Attic Insulation and Attic Air Sealing: $250/unit
Duct Sealing: $100/unit
Duct Insulation: $75/unit
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are designed to encourage homeowners to switch their home over to renewable energy by offering financial incentives meant to lower the burden of solar panel installation and use. You may be eligible for various types of incentives, such as discounts, cash back or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of Kentucky and others from the federal government. Some solar incentives you might qualify for are:
- Net Metering: Net metering is an incentive you can get once your solar panels are up and running. If you've signed a net metering agreement with your Covington utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this is a dollar-for-dollar credit, while in others you may be refunded a percentage of the value.
- Rebates: Solar rebates might be provided by your state or county, or by your local utility company. These rebates work as cash back that is applied after you pay for a solar system and before tax credits are calculated.
- Tax Credits: Tax credits lower, dollar-for-dollar, the amount of income tax you owe the federal government. Tax credits differ from tax deductions.
- Tax Exemptions: These could come in the form of property tax exemptions, which let you exclude the value added by your solar panels when calculating the taxes you pay on your home. They may also include exemptions on sales tax at the time of purchase.
Best Solar Financing
Blue Raven Solar
- Industry-leading in-house financing
- Competitive pricing
- Excellent reputation
- Doesn't offer solar batteries
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some knowledge of. One of the incentives that most people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a certain percentage of your solar system's cost.
The ITC covers solar systems installed after January 1, 2006, and allows you to deduct from your taxes a percentage of the total cost of solar panels, labor, equipment and accessories. You can claim this credit for solar panels installed on a primary or secondary residence in the United States that you own. The original amount you could claim was 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.
Speaking with your local Covington solar panel installer is the best way to learn more about how the ITC could apply to you.
In August 2022, the Inflation Reduction Act expanded and extended the ITC, now called the Clean Energy Credit. The Clean Energy Credit re-raises the credit up to 30% for solar systems installed between 2022 and 2032. After this, the credit percentage will see a slight decrease annually until the end of the program in 2035. Starting in 2023, it will also be easier to obtain credits for energy storage systems under the new laws.
More information about the new Inflation Reduction Act can be found here. To best understand how the new Clean Energy Credit applies to you, talk to your local Covington solar installation expert.
State & Local Solar Incentives
There are more than just federal solar incentives; rebates, tax credits and more are often offered at the local or state level. Incentives might be offered by your county or municipality, or by the state of Kentucky. Certain incentives may be available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Covington
The expanding number of available solar incentives has enormously increased the nationwide adoption of solar energy over the last 15 years. You may receive solar incentives from the federal government, the Kentucky government or from your local utility company. Reach out to your local solar panel installation expert today to discover more about the various programs and to save as much money as possible on solar panels for your Covington home.
EcoWatch's Covington, KY Solar Incentives FAQs
If I installed solar panels on my house a few years ago, can I still claim incentives?
Your best bet is to talk to someone from the company that installed your solar system – or reach out to a local Covington solar installer — to learn about which incentives you might qualify for. If your solar panels were installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
How long until the federal solar tax credit ends?
The federal solar tax credit, formerly known as the ITC and now titled the Clean Energy Credit, is scheduled to end January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
I want to switch my appliances out for ones that are more energy-efficient. Are there any benefits I can claim?
The new Inflation Reduction Act introduces multiple incentives meant to reward homeowners who make eco-friendly upgrades. Some incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.
Can I use a combination of solar and another type of renewable energy to power my home?
You can use multiple types of renewable energy, or a combination of renewable and non-renewable energy, to power your home. Be sure to go over your ideas with your local Covington solar installer. They can help you as you plan for your project and educate you on the various incentives that you will or won't qualify for.
Can I claim incentives for adding solar panels to a vacation home, rental property or commercial property?
Many solar incentives apply to a property you own that is located within the United States; most secondary residences fall under this distinction. There may be other solar incentives available for commercial properties, depending on the specifics. We recommend talking to your local solar installer and/or tax professional to better understand what incentives may apply to your specific situation.
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.