Incentives for Going Solar

Small house with solar panels

Solarize Northwest allows homeowners and businesses to tap into lowered upfront costs through program participation. Combining government incentives and the Solarize group discount, many program participants are able to recoup approximately 50% of their cost within one year!  Here’s how it breaks down:

Available in both Washington and Oregon:

The Solarize Discount: Group purchase brings down the cost of a solar system

By participating in Solarize Northwest, solar installers are able to offer significant group discounts on the purchase and installation of solar systems through the program’s focus on participant education, outreach, and economies of scale. Solarize discounts average between 10-15%.

Federal Tax Credit: 30% off total system cost

The federal government provides a tax credit to cover 30% of the total installed cost of your solar system. If you do not have the tax appetite to take the entire 30% credit in the first year, the remaining credit can be rolled over to your next tax return. This incentive begins to phase out after December 31, 2019.

Rural Energy for America Program (REAP Grant)

The federal government also offers REAP grants for those installing solar systems in rural communities. The maximum grant size is $500k or 25% of total project cost (whichever is lower). These grants are available for agricultural producers and rural small businesses. These categories are defined by the following criteria:

Agricultural Producers:

Individuals who derive over 50% of their gross income from agricultural production (crops, livestock, forestry, dairy, etc.) are able to receive the grant in the form of farm schedules or on their tax returns.

Rural Small Businesses:

Business based in rural communities, defined as communities with populations under 50,000, and that meet SBA Small Business Size Standards are also able to receive the grant on their tax returns. This definition includes for-profit businesses, cooperatives (501(c)(12)), electric utilities, and tribal corps.

Net Metering: Retail value for the energy you send into the grid

Receive credit on your utility bill for excess electricity produced by your system. In Washington, credits carry forward month to month for a year. In Oregon, the policy depends on the utility. This billing arrangement does not expire.

Available in Washington:

Washington Solar Production Incentive: Up to $0.18 per kilowatt-hour produced by your solar system

Washington state has established an annual production incentive that pays you for every kilowatt-hour of energy your solar system produces for eight years after installation. The rate you receive depends on when it was installed, the size of the system, and whether the solar panels were manufactured in Washington or out of state. For systems under 12 kW installed between June 30, 2018 and June 30, 2019, the “base rate” is $.14/kWh. For Washington-made solar panels, you also receive a $.04 bonus. The total amount that you receive from this incentive cannot be more than 50% of the total system cost, including sales tax. This rate steps down annually and sunsets June 30, 2021. IMPORTANT: Current data suggests that funding for this incentive may run out by the end of the calendar year (December 31, 2018). 

Available in Oregon:

Utility Incentives

Many Oregon utilities have solar incentives. Most of these incentives are cash payments based on system size that are paid once your system is installed. Find more information about some of these incentives below.

Additional Resource

Solar Incentive Database: The Database of State Incentives for Renewable Energy (DSIRE) provides comprehensive information on state, local, utility, and federal incentives and policies that support solar energy.