Washington’s Key Solar Incentives: A Breakdown

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Washington State is making significant strides in promoting solar energy, thanks to a variety of incentives designed to make solar installations more affordable and accessible. With a combination of state tax credits, utility programs, and net metering policies, Washington offers a range of benefits for homeowners and businesses looking to invest in solar power. In this article, we’ll break down Washington’s key solar incentives, detailing how each program works and how you can take advantage of them to reduce your energy costs and support a greener, more sustainable future.

The Residential Clean Energy Credit

The Residential Clean Energy Credit, previously known as the Federal Investment Tax Credit (ITC), can reduce the cost of your solar panel system by 30%. This incentive covers the entire system, including equipment, labor, permitting, and sales tax.

To claim this incentive, you need to purchase your system with cash or a solar loan, as leasing does not qualify for the ITC. You must have a sufficient federal tax liability to use the credit, though any unused portion can be rolled over year-to-year until the ITC expires at the end of 2034. Direct payment of the ITC is only available to tax-exempt entities, such as nonprofit organizations.

Solar Energy System Sales Tax Incentives

The Solar Energy System Sales Tax Incentives offer an exemption from sales tax on the procurement of machinery, equipment, and installation services associated with solar energy systems.

This exemption, effective until 2029, encompasses all sales tax incurred during the acquisition and installation of these systems, capable of generating up to 100 kilowatts (kW) AC of electricity. By leveraging this incentive, Washington property owners can potentially save over $2,000 on the total expenses associated with adopting solar energy.

Chelan County’s Sustainable Natural Alternative Power Program (SNAP)

For decades, Chelan County PUD has relied on clean, renewable, and cost-effective hydropower as its cornerstone. Now, emerging renewables such as solar, wind, and small hydro are complementing this established legacy.

Between 2003 and 2006, the Alcoa Community Foundation, McCandlish Electric of Wenatchee, and the International Brotherhood of Electrical Workers Local 191 collaborated to fund and install 36 solar arrays at schools and nonprofit organizations across Chelan County. The proceeds generated from electricity sales at these locations are reinvested into the schools and the wider community. For instance, at the Performing Arts Center in downtown Wenatchee, revenues from a 10-kilowatt solar installation can offset up to 20 percent of the building’s energy expenses.

Clark Public Utilities‘ Solar Energy Program

Clark Public Utilities’ Solar Energy Program is a robust and comprehensive initiative designed to encourage the widespread adoption of solar energy among both residential and commercial customers within their service area. This program not only aims to increase the use of renewable energy sources but also seeks to educate the community about the benefits of solar power. By providing resources, incentives, and support, Clark Public Utilities is committed to making solar energy accessible and affordable for all. Through workshops, informational sessions, and personalized consultations, customers can learn about installation processes, financing options, and the long-term savings associated with solar energy. Additionally, the program may offer incentives such as rebates or grants to further facilitate the transition to clean energy. Ultimately, Clark Public Utilities strives to foster a sustainable energy future while helping customers reduce their carbon footprint and energy costs.

Net Energy Metering

In Washington State, net metering enables both residential and commercial customers producing their own electricity from solar power to distribute surplus electricity back into the grid.

This practice yields numerous advantages. It allows solar energy users to balance their energy generation and consumption, ensuring continuous access to electricity even when their solar panels are inactive, such as during nighttime or cloudy conditions. Furthermore, it presents financial benefits, as surplus power supplied to the grid can be credited against consumed electricity, effectively reducing energy bills.

The Washington Utilities and Transportation Commission (UTC) oversees the services and rates of privately owned utility and transportation companies. The UTC has established regulations governing net metering in Washington, which include mandating utilities to provide net metering programs to their customers.

Solar for All

• The Community Power Coalition (CPC)’s SFA program, “Powering America Together,” will collaborate with and enhance the impact of the US Department of Energy’s National Community Solar Partnership and Community Power Accelerator program. Led by Inclusive Prosperity Capital, Inc., CPC comprises seasoned community solar experts who have contributed to the Community Power Accelerator as developers, lenders, trainers, and technical assistance providers. The program aims to support the development of low-income community solar projects, reduce carbon emissions, lower energy costs, and promote quality jobs, community wealth-building, energy resilience, and equitable workforce development. 
• Teaming up with lead applicant GRID Alternatives, a coalition of ten mission-driven nonprofit solar and affordable housing providers and allies has collaborated to develop the Solar Access for Nationwide Affordable Housing Program (SANAH). SANAH is meticulously crafted to maximize benefits for households and communities while advancing equity, reducing harmful pollution, and combating climate change. The program offers a multitude of advantages, including expanded access to solar and storage for income-qualified households, significant energy savings, and relief from burdensome costs, as well as additional benefits like efficiency improvements and electrification. 
• Washington is set to introduce a series of initiatives aimed at broadening solar accessibility for income-qualified residents and frontline communities statewide. These programs are designed to complement existing policies and initiatives promoting distributed solar adoption in the state. Among the proposed initiatives are programs tailored for single-family homeowners, initiatives facilitating access to state and federal solar incentives for multifamily affordable housing properties, and a program specifically geared towards Tribal solar deployment, developed in collaboration with Tribal governments. With a primary objective of ensuring equitable distribution of solar benefits to low-income households across Washington, these programs will particularly target environmental justice communities, aligning with Justice40 principles and Washington’s environmental justice commitments.

Disclaimer

The information provided herein is for informational purposes only and is accurate as of the time of publication. Please be aware that the solar energy landscape, including technology, regulations, incentives, and market conditions, changes frequently. Therefore, it is essential to consult with qualified experts and professionals before making any decisions regarding solar energy installations or investments. This will ensure that you receive the most current and applicable advice tailored to your specific circumstances.