IOWA RESIDENTIAL SOLAR INCENTIVES
The growth of the solar industry, in the Midwest, is of great importance to us here at Century Electric. However, we fully understand the initial economic impact that the purchase of a solar system may have on a homeowner. For this reason, our qualified personnel have worked hard to locate and deliver various incentives, made available by the federal government and the state of Iowa, that provide a more reasonable and cost effective price range for those interested in this technology.
Renewable Energy Tax Credits
The federal government has established a tax credit applicable for 30% of the total system and installation cost of a solar array. This is the most beneficial incentive available for solar energy and has allowed the industry to advance rapidly ever since its implementation by The Energy Policy Act of 2005.
Qualifications
Qualifications
- System must be placed in service before December 31, 2019
- Property must be used as a residence by the homeowner
- Residence must be in the United States
- Homeowner must be a taxpayer
Energy Efficient Mortgage Program
This incentive, brought forth by the Federal Housing Authority(FHA), allows homeowners to add the cost of a new solar system, up to 20% of the property value, to a regular FHA-insured mortgage.
Qualifications
Qualifications
- Homeowner must own solar system
- Homeowner must qualify on total loan with system cost through FHA
- Residence must be in the United States
Solar Energy Property Tax Exemption
The Iowa Department of Revenue, under Iowa Code §441.21(8)(b), mandates that the value of a solar system be excluded from the taxable property value for a period of 5 years.
Qualifications
Qualifications
- Primary purpose of the solar facility is to store or provide for on-site electrical demand
Iowa State Tax Credits*
Parallel to the federal renewable tax credits, Iowa has established their own credits that allow homeowners to acquire additional savings equal to 50% of the federal tax credit up to $5,000.
(30% × 50% = 15% of the total system cost)
Qualifications
OR
Renewable Energy Certificates (RECs)**
The state of Iowa has implemented an alternative program that provides homeowners the opportunity to sell the electricity produced by their solar system at a rate of $.015 per kWh for a ten-year period.
Qualifications
*This tax credit will prove to be, in many cases, the most advantageous residential incentive available by the state of Iowa
**In accordance with Iowa Code §476C.2(3), “any taxpayer eligible to claim a renewable energy tax certificate credit shall not be eligible to claim an Iowa state tax credit”
***Upon election to sell all produced electricity from the solar facility, the homeowner forfeits the right to make the claim that they USE renewable energy. The homeowner may, however, make the claim that they PRODUCE renewable energy.
****In accordance with Iowa Code §476C.1(7)(e), to remain eligible to claim a renewable energy certificate, upon election to consume all produced electricity from the solar facility, the solar system capacity must be no less than 750kW of nameplate generating capacity
(30% × 50% = 15% of the total system cost)
Qualifications
- Must meet requirements for the federal residential energy tax credits
- Installation location and homeowner must reside in the state of Iowa
OR
Renewable Energy Certificates (RECs)**
The state of Iowa has implemented an alternative program that provides homeowners the opportunity to sell the electricity produced by their solar system at a rate of $.015 per kWh for a ten-year period.
Qualifications
- System must be placed in service before January 1, 2018
- Installation location and homeowner must reside in the state of Iowa
- Homeowner must elect to either: sell all their electricity produced*** or consume all their electricity produced****
*This tax credit will prove to be, in many cases, the most advantageous residential incentive available by the state of Iowa
**In accordance with Iowa Code §476C.2(3), “any taxpayer eligible to claim a renewable energy tax certificate credit shall not be eligible to claim an Iowa state tax credit”
***Upon election to sell all produced electricity from the solar facility, the homeowner forfeits the right to make the claim that they USE renewable energy. The homeowner may, however, make the claim that they PRODUCE renewable energy.
****In accordance with Iowa Code §476C.1(7)(e), to remain eligible to claim a renewable energy certificate, upon election to consume all produced electricity from the solar facility, the solar system capacity must be no less than 750kW of nameplate generating capacity
