Net metering is a billing arrangement that allows customers who generate some or all of their own electricity to feed excess power back into the grid and receive credits on their utility bill. This allows customers to offset the cost of electricity they consume when they are not generating their own power. The credits are typically based on the amount of power generated, and the customer is only billed for the net amount of electricity consumed from the grid.
*Net Metering: Payment for excess electricity is not guaranteed and is dependent on your utility offering net metering. You should contact your utility for more information.
Solar Renewable Energy Credits (SRECs) are a type of renewable energy credit that represent the environmental attributes of one megawatt-hour (MWh) of electricity generated from a solar energy system. SRECs are valued based on supply and demand and can fluctuate in price. They can be sold on SREC markets and the revenue generated from the sale of SRECs can help to offset the cost of installing and maintaining a solar energy system. SRECs can also be used to claim additional incentives such as tax credits and grants, which will vary from state to state. The availability and the value of the SRECs can also be affected by the state’s RPS goals, the number of solar systems in the state, and the amount of solar energy generated in the state.
The federal government offers a solar tax credit, also known as the Investment Tax Credit (ITC), which allows taxpayers to claim a credit for 30% of the cost of a solar energy system on their federal income taxes. This credit applies to both residential and commercial solar energy systems and it’s available through 2032.
*You should contact a qualified tax professional to advise you regarding your eligibility for the Federal Solar Investment Tax Credit.
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