Incentives and Costs
Expand each section to see amounts for different households.
Tax Credit
30%
Of equipment and installation costs
25D provides households an uncapped 30 percent tax credit for rooftop solar. In 2022, an average 6kW rooftop solar installation costs is $15,300, thus the average tax credit will be around $4,600. Your actual costs will depend on a variety of factors, including the size of your house, size of your solar panel system, and location.
25D also includes a 30 percent uncapped tax credit for an electrical panel upgrade, but only if it’s upgraded in conjunction with rooftop solar. So it might be advantageous to do both at once!
Community solar and leased rooftop solar developers may be able to access additional 10% or 20% bonuses for projects located in and serving low-income or energy communities. These bonuses will not be directly accessible to homeowners; rather, they will further lower costs for leasing or subscription solar models.
More guidance on these bonuses is still pending from the IRS.
All the details
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How does it work?
Rooftop solar uses solar photovoltaic (PV) panels to turn sunlight into electricity. PV panels can be installed on your roof or even in your yard. When sunlight shines onto a PV panel — even on a cloudy day — your solar system will generate clean, renewable energy.
Rooftop solar provides zero-carbon, no-cost electricity once it’s installed and paid for. Depending on your situation, it might make sense to buy your rooftop solar outright or finance your purchase over a number of years.
How will it save me money?
Depending on how it’s purchased or financed, rooftop solar can save you hundreds of dollars a year. That’s because the electricity produced by rooftop solar is completely free! As you electrify your home and your electricity needs grow, rooftop solar may deliver even bigger savings.
Why is it better for the environment?
Rooftop solar produces no carbon emissions! In many cases, this carbon-free electricity will flow back into the utility grid, where it will directly decrease the amount of fossil fuels burned by your utility company.
Other benefits?
When paired with home battery storage, rooftop solar can keep your home powered in the event of grid outages.
