Residential Solar & Wind Incentives – Indiana
For residential renewable energy systems in Indiana, the federal government currently offers an unlimited 30% tax credit toward the purchase price of a solar electric, solar hot water, or wind energy system, including all materials and labor. This tax credit rolls over into future years if the tax credit exceeds your tax liability during the year you purchase the system.
The tax credit described above reduces the overall net system cost. The next three financial incentives pay back the renewable energy system owner over time. The first is the cost of the generated energy itself. For solar electric and wind energy systems, this is the electricity that you save and/or sell back to the utility company, which averages $0.08 per kilowatt-hour (kWh) in Indiana. For solar hot water, it is the water-heating fuel (typically natural gas, propane, oil, or electricity), which varies greatly depending on the fuel type.
The second incentive that pays back over time is a property tax exemption. If you have a solar electric, solar hot water, or wind energy system, you are exempt from paying property taxes on the value of the system (not the entire property) during every year that the system is functioning.
For solar electric and wind energy systems, there is yet another financial incentive that pays pack the renewable energy system owner over time - renewable energy credits (REC's). For solar electric systems, these are called solar renewable energy credits (SREC's). Effectively, Indiana residents currently receive an additional ~$0.05 / kWh for all electricity generated by their solar electric system thanks to SREC's. SREC's aren't quite that simple, however, and take some explaining - see our explanation here
Appraisers also estimate that renewable energy systems increase a building’s resale value significantly, but this depends heavily on the home buying market and the buyers at the time of listing the home.
There are several utility-specific incentives in Indiana that may also benefit owners of solar and wind energy systems. One very popular incentive is the performance-based program through Indianapolis Power & Light. With this program, system owners can receive up to $0.24/kWh for electricity produced by solar electric systems. Click here
to view the electricity rates for the various eligible system sizes. Use the DSIRE tool at the left to see if this or any other utility-specific programs apply to you
Commercial Solar & Wind Incentives – Indiana
Commercial incentives in Indiana are the same as the residential incentives described above except that businesses may be eligible for accelerated 5 year depreciation as well as 50% bonus depreciation in 2012.
Click to view SREC Explanation