The new year is here and it’s a great time to finally make that switch to solar. Now is the perfect time for residents of Colorado to enjoy the benefits of home energy efficiency and solar power. There have been many advances in the world of solar technology which translates to a lower cost of having a system installed on your property. But that’s not all we have to look forward to in 2022. The federal government offers a tax credit against the price of an installed solar system. You may even be eligible for several rebates and incentives depending on your municipality and which local utility service you currently use.
A solar power system installed on your property is a clean, viable, and renewable energy solution. It’s grown more popular while it’s become more accessible and affordable. You can finance your system or purchase it outright. How can you take advantage of all the solar energy here in Colorado? Let’s look at some of the incentives and current options available to help you take advantage of what’s available.
A Federal Investment Tax Credit (ITC)
The federal government provides an Investment Tax Credit on all solar systems installed in Colorado. This is a great time to take advantage of it. In late 2020, Congress extended the ITC for four more years. For solar systems installed between 2020 to 2022, the ITC provides a tax credit of 26%.
Think of the total cost of your solar system fully installed and apply 26% to your tax liability for the year! Simply take the cost of the installation and multiply it by .26 and that will give you the amount of the tax credit you’ll receive. Remember, this is a tax credit, not a cash rebate. And now is the perfect time to take advantage of it. You see, in 2023 the percentage will decrease to 22% and is set to expire in 2024.
Colorado Utility Incentives
Even though Colorado no longer offers tax credits for solar systems, the affordability of home solar power is better than it’s ever been. This is due to the fact that the cost of solar systems has dropped dramatically in the last few years. It’s more affordable to have a solar system than ever before! You may also still be eligible to receive some form of incentive or a cash rebate depending upon your local utility and/or the municipality where you reside. Here at Steel City Solar, we can help locate and explain any financial incentives or rebates that may be available in your area.
For some qualified homeowners, there are some grants for solar installations available. Some of these grants may cover up to half of the solar power system’s costs after the investment tax credit and other rebates have been applied. Many of the utility companies in Colorado offer a certain amount per watt installed and some fixed cash rebates for installed systems. Not every power company offers these incentives but through the ITC and net metering, investing in solar power now is more attractive than ever.
Colorado State Sales Tax Exemption for Solar Systems
Even though the state tax credit isn’t available anymore for Colorado residents, solar systems are still exempt from related sales and use taxes. It depends on your municipality, but these can represent a savings of 2.9% on the cost of wiring, racking, inverters, solar modules, and other components for your system. Another great benefit of having a solar system installed is that it increases the value of your home. Your property taxes will not be affected at all. Any Colorado resident who chooses to increase the value of their home by adding solar power will not be penalized in any way.
Who Is Your Best Source for Understanding Colorado Solar Incentives?
Working through the programs available like solar rebates, tax credits, PPA’s and net metering can be a little confusing. Figuring out all of the details can take some time, but will pay off over time. Your local utility company can be a great source of information. Every utility company in Colorado is required to generate a certain amount of power through renewable energy. It’s in the utility’s best interest to help you so that they can reach their goals. You can go to your energy company’s website or take a closer look at your energy bill. There should be information about solar resources included for consumers.
The easiest way is to get in touch with your local solar professional at Steel City Solar. Our business is solar power and we know all of the options and incentives available to you and your family. We have the most current information about what incentives are offered to you.
By installing a reliable solar system you’ll increase the value of your home without paying any additional taxes. Reach out to us today so that our solar professionals can help you make the choice that serves you best. We’ll spell out in simple terms what all of your options are and why generating clean renewable energy from the sun is right for you.