The Complete Guide To Solar Panels In Florida
5 - Minute Read
PUBLISHED: Nov 16, 2022
With a nickname like The Sunshine State, Florida sounds like a perfect place for homeowners to install solar panels. Combine the reputation for sunshine with solid financial incentives, and it’s easy to understand why Florida is No. 3 in the United States for solar energy capacity.
Let’s take a close look at the data for solar power in Florida to see whether adding a rooftop solar panel system to your home might result in a lower electricity bill.
The Cost Of Solar Panels In Florida
On average, the upfront cost of a 5-kilowatt (kW) grid-tied solar panel system is $12,800 before incentives. That breaks down to $2.56 per watt, which is significantly below the national average of $3.04 per watt.
Overall, the cost of photovoltaic (PV) systems has been falling in recent years. Across the United States, prices are down 53% over the past 10 years, according to the Solar Energy Industries Association (SEIA).
At this point, soft costs such as employee salaries and permitting fees comprise the biggest portion of the cost to install solar panels.
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Home Solar Incentives In Florida
Florida residents have an array of incentives to go solar, ranging from a federal government tax credit to state tax exemptions to net metering programs from utility companies. Up next is a closer look at what Floridians can expect if they invest in solar panels to produce clean energy for their home.
Federal Solar Tax Credit
The federal solar tax credit, sometimes called the solar Investment Tax Credit (ITC), is the most impactful nationwide incentive for homeowners to install solar. It was scheduled to expire beginning in 2024, but Congress extended the credit and increased it thanks to the Inflation Reduction Act of 2022. The tax credit is set at 30% of the cost of the system for systems installed by the end of 2032.
In 2033, the deduction amount drops to 26% before it decreases again, to 22%, in 2034.
Net Metering In Florida Offers Full Retail Value
Net metering is a method of billing that rewards solar homeowners for extra power they generate and send to the utility grid. Net billing compensation varies among states and utility companies, with some utility companies only paying customers with solar homes the lowest wholesale rate for the electricity they contribute to the grid.
In Florida, many of the utility companies and electrical cooperatives compensate customers at the retail rate. That means the utility company will pay you the same rate for the electricity you produce that they charge you for any electricity you consume. This should be welcome news for customers of Duke Energy, Florida Power & Light Company (FPL) and Tampa Electric, though smaller utility companies and co-ops may also pay the same 1:1 electricity rate.
Typically, grid-tied solar homes consume grid electricity at night and at other times when there’s not enough sunlight to produce electricity. Hybrid solar homes equipped with backup batteries, which we’ll discuss later, can power homes in the dark and during times of low solar production – potentially reducing a homeowner’s utility bill even more.
Boynton Beach Energy Edge Rebate Program Can Lower Your Solar Cost
The City of Boynton Beach provides eligible residents installing a solar energy system of 5 or more kW with a $1,500 rebate over a period of 10 years. A certified solar contractor must install the system, however. The city also expedites permits for residential solar systems as an added incentive.
Dunedin Solar Energy Rebate Grant Program Provided Up To $2,500
Though the funds supporting the City of Dunedin’s Solar Energy Rebate Grant Program have been exhausted for fiscal year 2022, the program may receive funding for 2023. The grant program provided homeowners and business owners with 25 cents per watt of solar power capacity, with a cap of $2,500.
Solar And Combined Heat And Power (CHP) Sales Tax Exemption Covers Renewable Tech
Florida’s Solar and CHP sales tax exemption applies to a variety of solar technology, including panels, space heat, water heaters and pool heating. Homeowners purchasing eligible solar equipment certified by the Florida Solar Energy Center are exempt from sales tax, with no limits.
Property Tax Abatement For Renewable Energy Property Reins In Extra Cost
Solar panels often raise a property’s value, which can in turn increase a homeowner’s property tax burden. In Florida, homeowners with solar get a 100% property tax exemption for the value a solar panel system adds to their property, provided the system was installed on or after January 1, 2013. The exemption also applies to other renewable energy technology, including wind turbines, energy storage devices, roof ponds and thermostats.
Business owners who add solar to their commercial property can earn an 80% property tax abatement for devices added January 1, 2018, or later. This will remain in effect through 2037.
Florida Solar Is A Growing Industry
Florida ranks third in the nation in solar generation capacity, with approximately 9,500 megawatts (mW) providing nearly 5% of the state’s electricity.
The solar industry employs nearly 12,000 people, who work for 50 manufacturers, nearly 200 installers and nearly 140 solar-related businesses. Florida’s solar companies, ranging from national businesses like Palmetto to local installers, have installed more than 142,000 solar projects.
FAQs: Solar Panels, Energy Storage And Long-Term Value In Florida
Here are a few common questions that Florida homeowners ask about solar panels.
Should I get a backup battery for a solar home in Florida?
While Florida is known for sunshine, it also experiences extreme weather such as hurricanes. Powerful storms can result in blackouts, which can make hybrid solar systems a worthy consideration for Florida homeowners. Battery storage systems can help keep critical appliances working during blackouts, and solar panels are built to withstand heavy weather. Installing a battery backup system at the time of installation can also be more cost-effective than retrofitting it later.
JEA, based in Jacksonville, previously offered rebates up to $2,000 for storage systems. JEA’s program has reached its limit for 2022, but it might be beneficial to check for updates if you’re considering energy storage.
Is solar worth it in Florida?
The typical payback period for a home solar energy system is 10 years in Florida.
The monthly average cost of electricity for a Florida homeowner is $130.40. That’s a total of $1,564.80 per year. Your amount in savings depends on several factors. These include your solar panel system cost, the energy you produce, your utility company’s net billing prices, your energy needs and electricity prices from local companies.
Does the City of Tampa offer any incentives to go solar?
Tampa Electric (TECO) doesn’t offer rebates, but it offers net metering for customers who have solar panels. TECO provides the retail value of excess energy that customers add to the grid.
The Bottom Line: Floridians Can Benefit From Home Solar Panels
Getting solar panels in Florida can be a smart investment for homeowners. Sunny days, impressive net metering policies, helpful rebates and a resurgent federal tax credit add up to potential for relatively low solar panel installation costs and long-term savings. Also, the addition of a battery backup system offers the possibility of keeping homes powered during blackouts.
Rocket Solar does not provide legal or tax advice. The information herein is general in nature and should not be considered legal or tax advice. Consult an attorney or tax professional regarding your specific situation.
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