2024 Solar Incentives Guide for Hoover, AL - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Hoover.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Hoover?
Local Option- Property Tax Exemption for Renewable Energy Faclities
Alabama Power - Residential Heat Pump Loan Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The phrase "solar incentives" refers to financial incentives designed to encourage people to use renewable energy by making installing and using solar panels more affordable. Incentives can include things like discounts, cash back or credit on your utility bill each month. Some incentives are handled federally, while others are provided by the Alabama government or by your utility company, county or municipality. Types of solar incentives might include:
- Net Metering: Net metering factors in once your solar system is up and running. If you've signed a net metering agreement with your Hoover utility company, it will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in others you might receive a refund equivalent to a percentage of the value.
- Rebates: Solar rebates can be provided by your state or county, or by your local utility company. These rebates are essentially partial refunds that are applied after your purchase of a solar system and before tax credits are calculated.
- Tax Exemptions: These may come in the form of property tax exemptions, which can let you exclude the value added by your solar panels when paying taxes on your house. They may also include exemptions on sales tax at the time of purchase.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.
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Federal Solar Incentives
When people think of solar incentives, federal incentives may be the first thing that comes to mind. You may have heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit equal to a certain percentage of the money you spend installing solar panels.
The ITC can be applied to the total cost of solar panel installation, including the panels themselves as well as labor, accessories and equipment. You can claim this credit for panels installed after January 1, 2006, on a primary or secondary residence that you own, as long as it is located in the United States. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum amount you can claim.
To better understand exactly how much the ITC could save you, speak with your local Hoover solar panel installer.
In August 2022, the ITC (now titled the Clean Energy Credit) was expanded and extended by the passage of the Inflation Reduction Act. For solar systems installed between January 1, 2022, and December 31, 2032, homeowners can apply for a credit equal to 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit expires in 2035. The program expansion also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.
More information about the new Inflation Reduction Act can be found here. The best way to fully understand how the new Clean Energy Credit applies to you is to get in touch with your local Hoover solar panel company.
State & Local Solar Incentives
Some solar incentives may be provided by state and local governments. Similar to federal incentives, these can include tax credits, rebates and more. Certain incentives are ongoing, while others might only be available for a limited time. Solar incentives may be given by your county or municipality, or by the Alabama government.
Next Steps for Installing Solar in Hoover
The variety of available solar incentives has enormously increased the nationwide adoption of solar energy over the past 15 years. You can get solar incentives from the Alabama government, the federal government or your local utility company. When you're ready to switch over to solar energy, reaching out to your local Hoover solar panel installation expert is a great first step.
EcoWatch's Hoover, AL Solar Incentives FAQs
My home already has solar panels. Are there any incentives that I qualify for?
Your best bet is to talk to someone from the company that installed your system – or reach out to a local Hoover 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 recently increased 30% tax credit under the Inflation Reduction Act. Solar panels installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
What are some environmental benefits of adding solar panels to my home?
Solar energy is a renewable energy source — by changing where you get your energy, you can help lessen the strain on our planet's resources. A solar system can also lower the CO2 emissions from your home by 450 pounds yearly, or around 9,000 pounds in 20 years.
When does the federal solar tax credit end?
The federal solar tax credit, previously called the ITC and now named 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 credits I can apply for?
The recently passed Inflation Reduction Act includes provisions for multiple incentives meant to reward homeowners who make eco-friendly upgrades. Some of these incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
Can I receive incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order in which incentives are applied could vary depending on which incentives you receive but usually yes, you can receive multiple types of incentives for your solar project. Talk with your solar installer or a local tax professional to verify you are claiming all the incentives you qualify for and applying them in the correct order.
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.