Is 2022 the last chance to go solar?

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Is 2022 the Last Chance to Go Solar?

We are often warned about the risks of delaying an important decision, but for those considering investing in solar energy, waiting doesn’t seem to be noticeably detrimental. This year, 2022, is when the Federal Solar Investment Tax Credit (ITC) is set to end, but this doesn’t mean it’s the last chance to go solar. There are still a variety of financial and environmental benefits while investing in solar energy now.

The Benefits of Going Solar

Homeowners have plenty of reasons to invest in solar energy, even after the ITC ends. Whether it’s financial, environmental, or independence, solar energy can provide plenty of advantages for homeowners.

Financial Savings

Going solar can potentially save homeowners thousands of dollars per year, depending on location and electricity prices. Solar panels are becoming increasingly affordable, with many low-cost options that are optimized for charging speed, output, power, and efficiency. Installment options are also available, so homeowners can spread the cost of a solar panel system over several years. The system size and cost will vary, but a base case 4kW system may cost between $12,500 and $16,500.

Environmental Benefits

When homeowners go solar, they are making a choice to reduce their carbon footprint that contributes to global warming and pollution. In addition to reducing air pollution, solar energy is also a renewable resource. This means that the energy homeowners generate is free and will last essentially forever—as long as the sun is shining.

Independence

When homeowners invest in solar energy, they are taking control of the source of their power. They are no longer reliant on the electric grid to power their needs. This makes them less affected by any power outages in their community, and also allows them to have control over the amount and cost of the energy they are consuming. Even though homeowners are still connected to the grid, they can maintain power even when grid power is unavailable and they can also purchase solar energy in bulk and use it to offset their energy costs when the grid power is expensive.

The Federal Solar Income Tax Credit

The Federal Solar Investment Tax Credit is a unique incentive that provides a one-time reduction in taxes for homeowners or businesses that invest in solar energy systems. The solar tax-credit must be claimed in the current year that you’ve gone solar, and it can be taken off of federal taxes.

Status of the Credit in 2022

The ITC has been in place for a number of years and is set to end in December of 2022. Even though the ITC will not be active in year 2022, homeowners can still benefit from the Solar Investment Tax Credit up until December of 2022.

Extension of the Tax Credit Through 2034

Due to the benefits of solar energy, the Solar Investment Tax Credit has been extended past 2022 and is set to last through 2034. This means that when homeowners go solar in 2022, they will still be able to take advantage of the 30% tax credit when they file their taxes.

Increase of the Tax Credit Through 2032

Starting in 2022, the federal tax credit incentive has been increased up to 30%, which is much higher than the 26% incentive that was in place prior to this change. This means that in 2022 and 2023, homeowners will be able to receive up to a 30% credit on all the money they spend on their solar system.

Other Solar Incentives

In addition to the federal tax credit, there are other incentives available for homeowners who decide to go solar.

Investing in Solar Energy

When homeowners invest in solar energy, they can benefit from being part of the growing solar industry. Investing in a solar energy system typically increases the value of any home and also offers an impressive ROI of up to 25%.

Tax Rebates and Local Incentives

In addition to the federal tax credit, homeowners can often receive local incentives like rebates and tax breaks for investing in solar energy. Homeowners should contact their local utility company to inquire about any additional incentives they may be eligible to receive.

Disadvantages of Going Solar

Though there are many benefits to investing in solar energy, there are also drawbacks that need to be considered.

Cost of Purchasing Solar Panels

The cost of investing in a solar energy system can be expensive, and it can take years to recoup the cost of purchasing the system. Though some installment options may be available, these payments can be high and can put strain on a household budget. The cost of the system will ultimately depend on the size and output of the system, but a large system may cost over $20,000.

Maintenance and Logistics of Solar Panels

The maintenance and logistics of solar energy can also be a challenge for homeowners. Though solar energy systems are designed to be low-maintenance, they do require occasional maintenance and upkeep to ensure they are functioning at peak levels. Since solar energy systems generate electricity, they also require wiring to be connected to the household system, which can be a complex and potentially costly process.

Conclusion

Even though the Federal Solar Investment Tax Credit is set to end in December of 2022, this does not mean that 2022 is the last chance to go solar. Homeowners can still benefit from the 30% tax credit until 2022, and the tax credit has been extended through 2034. There are also other incentives that can help to offset the cost of investing in a solar energy system. Whether it’s financial savings, environmental benefits, or independence, investing in solar energy now can provide homeowners with countless advantages for years to come.

Resources

Solar Energy Court

This online resource provides a variety of information and resources for homeowners considering going solar.

Solar Energy Group

This organization helps homeowners find the best solar panels, installation options, and other benefits available.

Solar Connections

This online resource provides a variety of information and resources for homeowners considering going solar.

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