Renewable energy incentives in North Carolina have changed throughout the years. However, plenty of tax credits are available to individuals and companies seeking to move into the solar industry. One of the most prominent incentive programs is the tax credits for solar investments offered by federal law. You are eligible for various commercial and residential NC solar credits from 2023.
North Carolina also offers state-based incentives that make solar an investment worth it for commercial and residential homeowners, including credits for federal taxes, such as net metering, and exemptions from property taxes. Find out more about NC solar incentives and tax credits to reduce the cost of solar investments.
FEDERAL SOLAR INVESTMENT TAX CREDIT (ITC)
Businesses and residents located in North Carolina can benefit from the ITC. The ITC aids in developing solar energy by providing a 30 percent tax credit to commercial and residential homeowners who choose to install solar panels. The tax credit helps reduce the amount homeowners be required to pay the government. The ITC will continue at 30% up to 2032. In 2033 the tax credit will decrease to 26%, then 22% in 2034. According to current law, the tax credit will be eliminated in 2035.
NC Residential solar tax credits permit homeowners to add the ITC to their income tax when they buy the solar system and then install it. Homeowners who move into a new home that is built that has a solar panel are theirs for the taking and can benefit from the ITC when they move into the house.
The ITC is a little different when it comes to homeowners and businesses. Commercial property owners can use an ITC tax deduction in Section 48 available to companies that construct, finance, or invest in installing a solar system. The credit begins at 30% as the credit for residential properties, but it will be modified after the Treasury releases guidelines for the requirements for apprenticeship and wage standards. Two months after, the credit will decrease to 6%. However, commercial companies can be eligible for the additional rate of 24% of 30 percent provided they meet the latest standard for labor.
Commercial construction projects completed before the 31st of December 2023 may be eligible for the prior 26 percent or 22 percent solar tax credit if installed before the 1st of January 2026. In the meantime, IRS has released guidance to assist commercial business owners in deciding if they have started construction on an eligible solar installation to be eligible for the ITC. To benefit from the tax credit for commercial solar in NC, you must comply with the guidelines in Section 48.
The ITC can also be available for Tesla Powerwall. Tesla Powerwall. The Tesla renewable energy credits permit homeowners and businesses to spread out the cost of some of the most efficient solar batteries available.
SOLAR REBATES IN NC
Duke Energy offered one of the most substantial Solar rebates across North Carolina for residential and commercial solar systems. However, the rebate program was canceled in 2022. Due to the sheer number of applicants and lack of funding, this program will likely be renewed. However, there may be a possibility that North Carolina Utilities Commission may offer incentives upfront for Duke Energy customers who install solar panels on their rooftops. This would replace Duke’s rebate program.
Asheville continues to offer solar rebates for permits for residential and commercial construction that permit the installation of solar systems. Locally, the Development Services Department administers the program and can help homeowners, and businesses offset the solar system’s expenses.
PROPERTY TAX ABATEMENT FOR SOLAR IN NC
Tax reduction on the property has been available for solar projects in NC since 2008. Solar power can increase property value. However, North Carolina has decided not to tax homeowners on the rise in value. For instance, if your home’s value is $300k, however, your solar installation will bring you to a home price of $30,000. North Carolina will only tax you on the $300,000 worth.
Commercial property owners also profit from this reduction. However, commercial property owners can only pay up to 80 percent of the value of their property in compacomparedtotal the amount given to homeowners.
NORTH CAROLINA SOLAR LOANS
Certain companies provide customers loans to help to finance a solar installation. For instance, Piedmont Electric Membership Corporation (PEMC) offers a unique program for its members to help fund their solar panels up to $10,000 with 5 percent interest for seven years.
Electel Cooperative Federal Credit Union also provides efficient loans at a reasonable cost. The rates are fixed, and clients can receive 100% financing on the solar panel’s purchase cost, including the installation and tax. A loan amount as high as $35,000 can be obtained via the credit union.
NORTH CAROLINA NET METERING
Net metering allows the owners of solar panels to sell the surplus energy generated by their boards into the grid. Selling the excess energy you produce increases the savings you make overall. Also, it creates credits you can utilize to pay your electric provider when your solar system doesn’t generate as much energy. Net metering is offered in North Carolina for systems up to 1,000 kW. This includes residential and commercial installations.
When you utilize the credit you earned on your utility bill for the month but remember that it expires at the beginning of the summer billing cycle. Setting up a system of optimal dimensions ensures you can profit from the credits you get. You can join net metering by calling your utility company and filling out an application.