4 Things You Should Know About Energy Credits

Over 120,970 households in Indiana have made the switch to solar power.

But, is it really right for you?

It’s never been more affordable to install and operate solar panels and that’s largely due to solar energy credits, deductions, and exemptions.

Here’s what you need to know about solar energy credits in Indiana.

Understanding All the Benefits of Solar Power

If you’re here, you know about all the solar savings to be had when you install solar panels on your home. Even if you don’t, we’ll explain those in detail in the next section.

However, we wanted to share some of the lesser-known benefits like health, safety, and security.

Health Benefits of Solar Energy

One study found that 8.8 million people die from outdoor air pollution each year (excluding indoor air pollution). The use of solar energy directly impacts those numbers. Having more homes that use solar power in your community promotes cleaner air.

Also, the development and management of powerplants, both solar and not, are harmful to the environment. The more people who use solar panels, the less need there is to develop new powerplants. This helps decrease the amount of total air pollution.

Solar Power Security

Increasing temperatures and extreme weather can cause blackouts and electrical problems. But, when you have an independent energy system, if you have energy stored, you’re ensuring that regardless of what happens to the grid, your family will be safe.

Unfortunately, these types of occurrences are only expected to increase in severity and how often in the years to come. Getting a solar energy system is a proactive way to approach the changing world with security.

Understanding Energy Credits

So, you’ve probably heard all kinds of things, both good and bad, about energy credits. The thing to know is that there are credits offered by the federal government and the state government. The types of energy credits offered at a state level are the credits you vote on and change between states.

1. Federal Residential Renewable Energy Tax Credit

The federal government offers a tax credit to homes that generate solar energy and other types of renewable energy like wind turbines and geothermal. If you install a solar power system before January 1, 2023, you will receive a 26% tax credit. If you install one later, you’ll receive a 22% credit.

2. Sales Tax Exemption & Easement Laws

Indiana is among the many states that do not apply sales tax to solar energy systems. This includes everything from the panel itself to the inverters and racking, anything directly used to produce energy. Indiana also has laws in place to help solar panel owners with planning and zoning to ensure a neighbor’s tree isn’t blocking their solar panels.

3. Net metering Energy Credit

In Indiana, you can actually make money on the energy you’re producing but not using or storing. Basically, with net metering, you make money by sending your excess energy back to the grid. Any energy system that produces under 1 megawatt (MW) of solar energy can participate.

4. Property Tax Exemption

Not only are products directly used to generate solar energy tax-free, but solar energy systems are also exempt from property taxes. So, basically, you get the added value to your home without having to pay more in property tax.