Solar isn’t particularly useful without any sun hitting your roof. Fortunately, we live in Florida. It’s sunny here a full month more than in other states.
As a Floridian, you already know that.
What you might NOT know is that Florida is the third highest state in the county, second only to California and Texas, in terms of carbon emissions.
Our state and local governments are highly incentivized to fix this issue. In an effort to do so, they provide a number of financial incentives for residents who choose to adopt solar.
Today we’ll cover the most important ones. That said, there are a number of local incentives we won’t cover here. If you’re interested in learning more about how these apply to your specific city, as well as other ways you can save, we’d love to help.
Federal incentives
Before we talk about our state benefits, let’s get the federal benefits out of the way.
The fed offers what’s called the “Federal Solar Investment Tax Credit” (you’ll often see this referenced as ITC).
This credit allows homeowners to write off a whopping 30% of the price of their solar systems on their taxes through 2033.
Even better, there’s no cap to what can be claimed. A 10kW system will receive that same 30% return as a smaller 3kW system.
You can claim this credit once for the tax year in which you installed your system. A simple example would look something like this.
Assuming you spent a flat $20,000 on your system, your credit would be equal to $6,000 (20,000 * 0.30). On your next tax return, you’ll be able to claim this $6,000 as a deduction. If you don’t owe $6,000, you can apply the difference the following year.
There are a handful of caveats (full list here) that may effect your eligibility, the main to note is that this incentive won’t apply if you choose to lease or finance your system.
Net Metering
Have you heard people say something along the lines of “You can sell the energy you produce back to the electric companies”? Well, that’s net metering! And for most Floridians, it’s mostly true.
The way this works is as follows:
So long as your electric company offers net metering (all of the major energy companies in the state, including Duke, FPL, Tampa Electric, and Florida Public Utilities, as well as most local providers), they will measure the energy your system creates.
If the amount of energy that you create is greater than the amount you use, they’ll credit you back the surplus. In Florida, there isn’t a cap on how much energy you can contribute.
Electric companies will credit this back at a 1-to-1 ratio. This means that you’ll receive the same amount back as they would have charged you for the amount of power you sent back to the grid.
Any credit you receive will be subtracted from your future energy bills. If you happen to consume less than you created the following month, your credit will roll over.
Any extra credits you’ve stored up at the end of the year will be paid back to you at an avoided-cost rate. This rate may be lower than the 1-to-1 rate you’ll receive from the credits to your power bill.
Property Tax Exclusion
Florida offers a 100% property tax exemption for residential and an 80% property tax abatement for non-residential solar projects.
In short, this means that solar projects aren’t treated the same way as, say, adding an addition to your house. With most home additions, your property tax will increase proportionally to the increased value of your home.
In simple terms, if you pay $4,000 a year in property taxes, don’t expect that value to change when you install solar.
According to research by Zillow, homes with solar are valued at 4.1% higher versus the same house next door without it.
Pairing this knowledge together, solar can be a great way to bump up the value of your home.
0% sales tax on solar projects
This one is fairly straightforward, but don’t expect to have to pay your usual 6% sales tax when installing solar.
With the Solar and CHP Sales Tax Exemption, Florida is one of only 13 states to waive sales tax for solar.
Given that our sales tax is 6%, you can expect your $20,000 system to remain a $20,000 system, not a $21,200 system.
Local Incentives
Some cities offer additional incentives on top of the state and federal incentives.
One great example of this is Boynton Beach, where residents who install a 5kW capacity or greater system can receive up to $1,500.
If you’re hoping to learn more about your city’s local incentives, you can start by checking out the DSIRE database or your local government websites.
We’re also more than happy to point you to one of our local reps to help guide you through the process. We install solar across the state of Florida, and our representatives will be able to outline every way you can save on your installation.
Contact us here if you’re looking for any further guidance!