Arkansas Solar Incentives and Rebates
Arkansas is a state with abundant solar potential and a growing interest in renewable energy. One way for individuals and businesses to tap into this potential is through the use of solar energy systems. However, the cost of installing a solar energy system can be a barrier to entry for many. Fortunately, there are a number of solar incentives and rebates available in Arkansas that can help reduce the cost of going solar.
The Federal Investment Tax Credit in Arkansas
The ITC is a federal incentive that provides a 30% tax credit for the cost of installing a solar energy system. This credit can be applied to the cost of both residential and commercial solar systems and can be claimed on your federal income tax return.
State-level Tax Incentives in Arkansas
Unlike many other states, Arkansas does not offer any state-level incentives for solar energy systems. However, this does not mean that there are no opportunities for Arkansas residents and businesses to save money on their solar investments. The state of Arkansas has a webpage (https://www.adeq.state.ar.us/energy/) dedicated to Energy Performance, where the reason for this lack of incentives is explained.
State-wide Solar Initiatives in Arkansas
Despite the lack of state-level incentives, there are several other ways for Arkansas residents and businesses to save money on their solar investments. These include:
- Arkansas Solar Rebate: The Arkansas Advanced Energy Foundation (AAEF) offers a rebate program for residential solar energy systems. The rebate amount is based on the size of the system and is currently set at $1.50 per watt for systems up to 10 kilowatts (kW) and $1.00 per watt for systems between 10 kW and 25 kW.
- Local Incentives: Some Arkansas utility companies offer local incentives for solar energy systems. For example, Entergy Arkansas offers rebates of $500 for residential systems and $1,000 for commercial systems.
- Solar Energy System Equipment Credit: Arkansas offers a credit against state taxes for solar energy system equipment. The credit can be used to offset up to 50% of the cost of the equipment, with a maximum credit of $5,000 per taxpayer per year.
- 30% Tax Credit for Installing Solar Systems from 2022 through 2032: Arkansas will also be offering a 30% tax credit for installing solar systems from 2022 through 2032, through the state’s income tax laws.
- Arizona solar financing options: Arkansas residents have access to financing options for solar energy systems. These include loans, leases, and power purchase agreements (PPAs).
State-wide Tax Exemptions in Arkansas
It is important to note that there are currently no state-wide tax exemptions in Arkansas for solar energy systems. However, the credits and rebates mentioned above can still help offset the cost of going solar.
Solar Easements in Arkansas
Arkansas has state-specific laws regarding solar easements, which are agreements that allow for the use of sunlight on a property. These laws enable solar leasing and third-party purchasing for non-taxed entities, allowing greater consumer flexibility.
Additionally, solar easement laws in Arkansas more than triples the maximum solar size limit for businesses. This increases the potential for businesses to install larger solar energy systems, resulting in greater energy savings and cost reductions.
A Grandfathering provision also provides market certainty and protects solar customers from future rate changes. This is a protection clause that allows an individual or company to install a solar energy system and lock in the current rate structure and terms, even if the rate structure changes in the future.
Net Metering in Arkansas
One of the ways that the power generated by solar panels in Arkansas is credited is through net metering. Net metering is a policy that allows residential and commercial solar energy system owners to receive credit for any excess electricity they generate and feed back into the grid.
This can help offset the cost of electricity during months when the solar energy system may not be producing enough electricity to meet all of a customer’s needs. This credit is applied on a monthly basis and as a dollar-for-dollar credit on the customer’s electricity bill.
Benefits of Going Solar in Arkansas
There are many benefits to going solar in Arkansas. One of the most obvious is reduced electricity bills. By generating your own electricity, you can significantly decrease the amount you pay for electricity from your utility company. Additionally, solar energy systems can increase the value of your property and improve your home’s resale value.
Tax incentives also provide a financial benefit to those who choose to go solar. The Federal Investment Tax Credit (ITC) offers a 30% tax credit for the cost of installing a solar energy system. Arkansas also offers a credit against state taxes for solar energy system equipment, which can offset up to 50% of the cost of the equipment, with a maximum credit of $5,000 per taxpayer per year.
Arkansas has a great solar potential, and a growing interest in renewable energy. The state-specific laws on solar easements, net metering policy and tax incentives, coupled with the Federal Investment Tax Credit make it an attractive state to invest in a Solar Energy System. The opportunities to save money on solar investments and the benefits of reduced electricity bills, increased property value, improved home resale value, and tax incentives make going solar in Arkansas a smart financial decision.
FAQsWhat incentives are available for solar energy in Arkansas?
Arkansas offers a net metering program, which provides solar customers with retail rate credits for excess electricity generated by their solar panels. There are also federal tax incentives available for installing solar energy systems.
How much money can I save by going solar in Arkansas?
The amount of money you can save by going solar depends on the size of your system, your local energy rates, and other factors. On average, Arkansas solar customers save around 20-30% on their energy bills. Get more solar saving information at SolarEmpower.
How long will my solar system last?
A properly maintained solar system should last 25-30 years. Find out about solar system warranties at SolarEmpower.
Are there any solar contractors in Arkansas?
Yes, there are several solar contractors in Arkansas who can help you install and maintain your solar system. View reviews of solar contractors in your area at SolarEmpower.
Does Arkansas have any solar laws?
Yes, there are several laws and regulations in Arkansas related to solar energy. These laws cover topics such as net, interconnection, and solar rights.