Idaho Solar Incentives
What are the incentives for going solar in Idaho?
- Idaho has one of the best tax credit plans of any state in the union for consumers who choose to go solar. Under the “Residential Alternative Tax Deduction”, you may deduct a whopping 40% of your total cost for solar panels and installation from your state income taxes. Furthermore, Idaho residents may deduct 20% of that same cost each year for the next three years after your solar panels are installed. This deduction maxes out at $5,000 per year or a total of $20,000, whichever comes first. Keep in mind, your entire installation may cost around $20,000. So if you claim a 40% credit the first year, that maxes out at $5,000. If you claim another 20% every year for the next three years, you will ultimately claim a $17,000 tax credit- Meaning you’ve basically been refunded 85% of the total cost of your $20,000 system. But wait, there’s more.
- Don’t forget that 26% of the total cost of your system can also be claimed as a credit toward your federal income tax liability- another savings of potentially thousands of dollars. So let’s say that you save $1,000 in taxes after claiming your 26% federal income tax credit. Now you have essentially gotten back $18,000 of the cost of your $20,000 system.
- Now lets ignore all that above- What if you don’t receive one single tax incentive, rebate, credit, or anything else for your solar panels. Will they ever pay for themselves? The answer is yes. Regardless of any other bonuses or incentives, you can expect your solar panels to pay for themselves in as little as 15 years- And yes, 15 years is a long time, but when you consider that your solar panels will continue functioning and providing you free electricity long after they have paid for themselves, all of a sudden you’ll find yourself making a sound investment by installing solar panels, as they will routinely last 25 or more years.
- The state of Idaho does not have mandated net metering laws, but the three biggest utilities in the state (Idaho Power, Avista Utilities and Rocky Mountain Power) do offer net metering to customers. So what’s the big deal with net metering? Net metering is the process by which a utility measures not only the output of your solar panels, but how much of that energy you actually use as opposed to how much gets fed back into “the grid”. Utilities with net metering will credit customers for the energy their systems feed back into the grid, usually with free kilowatt hours of electricity on future electric bills. In other words, when you generate electricity that you don’t use, your utility will count that toward your electric bills in the future, thereby not only providing you free energy immediately but also in the future when your solar panels may not generate as much electricity as you use.
- The Idaho OER (Office of Energy Resources) State Energy Loan Program offers a loan of up to $15,000 at a low interest rate (4%) with a 5 year payback window to help citizens considering installing solar power systems. For more information on the program, visit oemr.idaho.gov/loan-program/
- Increase in Property Value- Homes in Idaho with solar panels are appraised at $10,000 to $20,000 more valuable than similar homes without solar panels. This alone can make your solar panel installation worth every cent you pay for it, but you can also expect your home to sell faster than homes without solar panels when it goes on the market.
- When I say Idaho, you think of sunshine, right? No? That’s ok, that’s not one of the things the ole potato state isn’t necessarily known for. But here’s the thing- Most parts of Idaho average well over 200 sunny days per year, so they’re just as sunny as most states in the U.S. And what’s more, the temperatures in Idaho most definitely lend themselves to solar panels. Solar panels slowly become less and less efficient with every degree fahrenheit temperatures rise above 78, but most of the year in Idaho you’re not going to have to worry about that. As a matter of fact, 8 months out of the year temperatures average less than 78 degrees fahrenheit, which means your panels should operate fairly efficiently year round.
- Solar panels in Idaho cost only about $2.52 per watt. Most solar panels used in home installations are sold in 250 watt varieties, meaning you’ll pay around $630 for a solar panel in Idaho, which is significantly cheaper than the national average of around $3 per watt or $750 per panel. Your total cost for solar panels in Idaho, depending on how big a system you wish to install, is going to come to around $12,000-$17,000, which is again relatively cheap compared to other parts of the country. So comparatively, solar panels in Idaho are not cost prohibitive.
- Thanks to the outstanding tax incentives in Idaho, your lifetime savings from your solar panels could be as high as $50,000 or more, and that’s with Idaho currently having the cheapest electric rates in the U.S. at 7 cents per kilowatt hour. And with today’s rising energy prices, there’s a very good chance that price will rise significantly in coming years, making your savings even higher.
So in the end, here’s what you’ve got to consider
- Your solar panels will absolutely pay for themselves- Once you consider the fact that 85% of your panels may be paid for by tax breaks and credits, your solar panels will save you enough money in 5 years or less to completely pay for themselves, and you will likely have them for 20+ years after that.
- Solar panels will 100% of the time raise the value of your home by almost as much as you pay for them
- The weather in Idaho is, for the most part, very favorable to solar panels
So there you have it. Idaho has everything you could want in a solar state. So if you’re ready to take the plunge, start looking for a solar installer today and take the plunge.