- Utah had nearly 3MW of solar energy installed in 2022, enough to power over 500,000 homes.
- Government officials in Utah are not supportive of renewable energy, making it difficult for homeowners to invest in solar panels.
- Homeowners in Utah can save money on solar panels through the federal solar tax credit, but this program is set to decrease and end by 2035.
- Utah offers little financial assistance for solar, with a state tax credit that is being phased out and limited net metering regulations.
- Utah allows for solar leasing, but it may not be cost-effective due to low traditional power rates.
In 2022, Utah had nearly 3MW of solar energy installed, enough to power over 500,000 homes. The incredibly sunny state has an opportunity to invest in renewable power. However, government officials seem to think otherwise. This leaves homeowners in a tough position when considering solar panels in Utah.
However, if you’re looking to improve your carbon footprint, you can still save money on an array. In this article, we cover all the available programs in the Beehive state. Let’s dive in.
How to Save Money on Solar Panels in Utah: Overview
With excellent sunlight, you may think that solar panels in Utah make sense. However, equipment rates are high, and traditional power rates are low, so the decision isn’t so straightforward. To bridge the gap, homeowners should look to state officials for financial support.
Unfortunately, the legislature in the Beehive State plants its feet against renewable energy, providing few options for Utahns to make the switch. However, you can still find assistance if you know where to look.
Between the federal solar tax credit and a dwindling state return, you can save money on an installation. However, these benefits are disappearing by the year, so if you’re considering solar panels in Utah, don’t wait. Here’s what you need to know about the available incentives.
Solar Panels in Utah: Federal Incentive
As the biggest opportunity for homeowners across the country, Utahns need to take advantage of the federal solar tax return. This program offers a 30% credit on your taxes for any solar purchases made, including equipment, labor, and even sales tax. Homeowners in Utah who purchase a 6kW system could save nearly $5,000 with this return.
However, just like the state’s incentives, this program won’t last long. The 30% return drops to 26% in 2033 and to 22% the following year. And if it’s not extended, the program ends in 2035.
Utah’s State Credits and Rebates
In many states, the most helpful opportunities come in the form of a financial incentive. While Utah offers little assistance to its residents for solar, it does have a state tax credit. However, this program won’t last much longer.
Originally worth $1,600, government officials plan on phasing it out by $400 each year until 2024. This means the credit is only worth $400, and only for the next year.
If you do end up purchasing a system in Utah, you have access to a stripped-down version of net metering. This regulation requires utility companies to purchase your excess solar energy, giving you a credit on your next month’s power bill.
In Utah, investor-owned utilities have to buy your power, but any credits you have left over at the end of the year expire. Therefore, it’s important to have your system accurately sized for your needs.
Solar Panels in Utah: Government Regulations
Utah’s solar incentives have fallen into disrepair, but it doesn’t come as a surprise when considering the state’s renewable portfolio standards (RPS). We use a state’s RPS to determine its intention to invest in future clean energy. The Beehive State has a voluntary RPS with a goal of 20% renewables by 2025. However, this doesn’t pressure utilities to make moves for solar, and the state has yet to meet the goal. This suggests that government officials are in no hurry to support solar panels in Utah.
Should Utahns Lease Solar?
In some states, homeowners can choose to lease a solar panel system instead of buying one. This helps those without the funds or capability to install an array. While it disqualifies the system from incentives such as the federal solar tax credit, it’s a great option that opens renewable energy to more people.
Fortunately, Utah does allow solar leasing. However, because traditional power rates are already so low, it might not be worth it after lease payments. Therefore, this option only makes sense for those looking to improve their carbon footprint.
Solar Panels in Utah: Incentive Summary
|Federal Tax Incentive
|Utah Tax Credits / Rebates
|$400 until 2024 / none
|Renewable Portfolio Standard
|20% by 2025 (voluntary)
|Property Tax Exemption
|Sales Tax Exemption
|Performance Payment Program
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