A Guide to US Government Grants and Support for Solar Panels

Be aware that the federal solar tax credit is ending soon and won't apply to expenditures after December 31, 2025. Who offers solar energy rebates? Let’s explore the federal program and the top five states leading the way in solar incentives.

US Government Solar Incentives

The Federal Solar Investment Tax Credit (ITC) allows homeowners to deduct a percentage of their solar installation costs from their federal taxes. Eligible expenses include:

• Solar panels

• Inverters and wiring

• Battery storage

• Installation labor

This program is one of the biggest cost-saving tools available today. However, the ITC is set to expire after December 31, 2025, which means homeowners need to act before the deadline. Pairing the federal tax credit with state-level rebates maximizes savings.

Top 5 States Offering Government Solar Rebates

1. California

California has one of the most comprehensive sets of solar incentives in the country.

• DAC-SASH Program: Provides up to $15,000 in rebates for low-income households.

• Additional local and utility rebates further reduce costs.

• A robust net billing policy ensures excess energy is credited, lowering monthly bills.

➡ California leads the nation in solar capacity thanks to its incentive structure.

2. New York

New York offers both direct rebates and state tax credits.

• NY-Sun Initiative: Cash rebates based on system size and performance.

• State tax credit: Covers 25% of installation costs, up to $5,000.

• When combined with the federal ITC, homeowners in New York can cut thousands off their total solar expense.

3. Massachusetts

Massachusetts combines performance-based incentives with tax benefits.

• SMART Program: Pays incentives based on the amount of solar energy generated.

• Extra bonuses for battery storage and for homes in low-income areas.

• Property tax exemption: Solar panels and supplemental equipment (like inverters and charge controllers) are not added to property tax assessments.

4. Connecticut

Connecticut makes solar more affordable through the Residential Solar Investment Program (RSIP).

• Rebates are issued per kilowatt installed, rewarding larger systems with greater savings.

• Higher rebates are available for moderate* and lower-income households.

5. Maryland

Maryland’s Solar Access Program (MSAP) offers some of the most generous support in the country.

• Incentive of $750 per kWh of system capacity, up to $7,500.

• Income eligibility limits are relatively high, starting above $124,000 for a single-person household, making many families eligible.

Who Benefits Most from Rebates?

• Homeowners planning solar installations before the 2025 federal deadline.

• Residents of states with active rebate programs (California, New York, Massachusetts, Connecticut, Maryland).

• Low* and moderate-income households, who often qualify for higher rebate tiers.

• Households adding battery storage, which earns additional incentives in certain states.

Additional States with Strong Incentivess

Texas

• No statewide rebate, but many utility companies offer cash-back programs for installing solar.

• Net metering policies vary by provider, allowing bill credits for excess generation.

Colorado

• State-supported Performance-Based Incentives (PBI) through utilities such as Xcel Energy.

• Property and sales tax exemptions for solar equipment.

Florida

• Sales tax exemption on solar equipment.

• Property tax exemption: Installing solar won’t increase property tax assessments.

• Several utilities (e.g., Florida Power & Light) offer rebate programs for battery storage.

New Jersey

• Transition Renewable Energy Certificates (TRECs) program: Homeowners earn certificates for every MWh their system produces, which can be sold to utilities.

• Net metering policies ensure strong long-term savings.

How much can you save with solar panels?

According to the U.S. Energy Information Administration, the average United States electric bill is $132.17, based on data collected from 2023.

How to Maximize Solar Savingss

• Stack multiple incentives: Combine federal, state, and local rebates for maximum savings.

• Install early: Complete your solar project before December 31, 2025, to lock in the federal credit.

• Work with certified installers: Many provide guidance in filing rebate applications and ensuring eligibility.

Conclusions

Solar rebates and tax credits make renewable energy far more affordable for U.S. homeowners. With the federal solar tax credit ending after 2025, acting now ensures the best return on investment.

Explore state-specific programs, confirm eligibility, and start planning installation before the deadline—every dollar saved upfront can accelerate the long-term benefits of solar energy.

Thanks for reading!