Solar / October 6, 2020
3 Ways to Reduce the Cost of Your Solar Install
Reducing your monthly utility bills is one of the most exciting parts of any new solar panel installation. Still, the upfront cost of installation can sometimes put a damper on the fun. If you’ve already done all that you can to maximize the value of your new solar system, then you may still want to consider ways that you can save some money upfront.
Discover three simple ways that you can reduce your installation costs while still enjoying the benefits of clean and efficient solar energy.
Have you put off a solar panel installation for months or even years? Unfortunately, the most effective option for reducing solar installation costs won’t exist forever. The Federal Solar Tax Credit (also sometimes known as the Investment Tax Credit, or ITC) is a nationwide program that allows you to deduct some of your installation costs from your federal taxes.
The program launched in 2016 and initially allowed homeowners to deduct as much as 30% of their installation costs. The design of the ITC gradually phases out these benefits, however. Now through 2022, the tax credit available to homeowners covers 26% of installation costs. By 2023, the tax credit will drop to 22%. By 2024, the ITC will phase out entirely for residential properties.
Note that you must own your solar panel system to be eligible for this tax credit, although you will still retain eligibility if you finance the purchase and installation cost.
Use Local Incentives
Most states offer a variety of local incentive programs to encourage residential solar use, and California is no exception. While the federal tax credit will often make the biggest dent, local incentives can help to knock a few dollars off of your initial or ongoing solar panel costs. The most considerable benefit you’re likely to see in California will come from the Self Generation Incentive Program (SGIP).
Under this program, you can qualify for a rebate if you choose to install a battery to support your solar panel installation. The SGIP rebate scales up with the size of the battery that you install, but program funds are limited. As with the federal tax credit, you can save the most money by acting quickly and installing a battery-backed solar system in the near term.
Net metering is another way to help offset your solar costs, but it won’t provide an upfront rebate. Instead, this program allows you to receive credits to use for future utility bills if you generate more energy than you need. In essence, you store electricity with your utility company to reduce or eliminate utility costs should you have an energy shortfall in the future.
Size Your System Correctly
Like many home upgrades, sizing your solar panel system is all about hitting the sweet spot. The shape and size of your roof, the amount of sunlight that you receive, and other factors can all impact the overall efficiency of your system. In many cases, a time may come where adding more panels and capacity may no longer be cost-effective.
When saving money on installation costs, be sure to establish your goals and budget as early as you can. Discuss these goals with your installer so that they can recommend a system that fits your specific needs and point out if you may be buying a more extensive panel array than you actually need. Whatever your solar goals, Mauzy Heating, Air & Solar can help you to achieve them. Contact us today to discuss the ways that we can help you to build your dream solar system without breaking the bank.
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