As more people become aware of the environmental impact of our energy consumption, they seek out more sustainable sources. Solar energy is one such alternative that’s becoming increasingly popular in the United States. But what many people don’t realize is that certain states offer better incentives than others when it comes to solar energy.

In this post, we’ll explore 10 of the best US states for solar incentives and discuss the advantages each state provides to its residents who choose to invest in renewable energy sources.

How Solar Incentives Work

When you install a solar panel system on your home, you are eligible for a number of different incentives. These incentives can help to offset the cost of installation and make going solar more affordable. Here is a look at some of the most common solar incentives and how they work.

The federal government offers a tax credit for solar installations. This tax credit is equal to 30% of the cost of the system, and it can be applied to both residential and commercial properties. In order to receive the tax credit, you must have your system installed by December 31st, 2021.

Many states also offer their own solar incentives in addition to the federal tax credit. These programs vary from state to state, but they often take the form of rebates or grants. Some states also offer property tax exemptions for solar installations. You can check with your state’s energy office to find out what incentives are available in your area.

Utility companies also sometimes offer incentives for going solar. These programs are typically called net metering or interconnection agreements. Under a net metering agreement, you can sell excess electricity generated by your solar panels back to the utility company at a set rate per kilowatt-hour (kWh). Interconnection agreements allow you to connect your solar panel system to the utility grid so that you can sell excess electricity generated during times of peak demand back to the grid.

What Types of Solar Incentives Are There?

There are three primary types of financial incentives for solar PV in the United States: tax credits, rebates, and performance-based incentives (PBIs).

Tax Credits: Many state and local governments offer tax credits as an incentive for installing solar PV systems. The federal government also offers a tax credit for solar PV installations. The federal tax credit is currently 30% of the cost of the system, and it is available for both residential and commercial installations.

Rebates: Some utilities offer rebate programs to encourage their customers to install solar PV systems. Rebates are typically a certain dollar amount per kilowatt (kW) of installed capacity. For example, a utility might offer a $1/watt rebate for systems up to 10 kW in size.

Performance-Based Incentives (PBIs): PBIs are offered by some utilities as an incentive for customers to install solar PV systems. With a PBI, the utility pays the customer based on how much electricity the system generates over a specified period of time, usually 1-5 years. PBIs can be either fixed or variable rate payments.

How to Choose the Best Solar Incentive

When considering solar incentives, the best thing to do is consult with your state’s solar energy office or website. Here, you can learn about any ongoing programs or rebates that are available to residents who install solar panels.

You should also check out the Database of State Incentives for Renewables and Efficiency (DSIRE). DSIRE is a comprehensive database of U.S. state and federal incentives that promote renewable energy and energy efficiency. The website provides detailed information on solar photovoltaic (PV) incentives available in each state.

Solar PV systems can be expensive, so it’s important to take advantage of any financial incentives that are available in your state. These incentives can help offset the cost of installing a solar PV system, making it more affordable.