Last updated: December2024
Written by
Catherine Lane
You can save an average of $7,560 on the cost of installing solar panels in Florida with solar incentives. With major tax incentives like the federal solar tax credit and a property tax exemption, you can keep more money in your pocket when you go solar. These incentive savings don’t even include the electricity bill savings solar panels provide in Florida, thanks to the state’s great net metering policy.
This guide is a definitive resource on Florida’s home solar incentives. It will help you learn how to qualify, save, and apply.
Incentive | Estimated average annual savings | Eligibility | About |
|---|---|---|---|
Federal solar tax credit | $7,560 | All tax-paying U.S. citizens | Tax credit equal to 30% of installation costs, applied to federal income taxes |
Solar property tax exemption | $250 per year, varies by location, system, and property value | Florida residents installing solar and other renewable energy equipment to their homes | 100% exemption of value of renewable energy system from property taxes |
Solar equipment sales tax exemption | Varies by system | All equipment associated with generating solar energy | Exemption from state sales and use tax |
Quick Facts
Value: 30% of solar installation costs
Frequency: One-time tax credit, rollover for five years
How to apply: File IRS Form 5695 with annual tax return
While Florida doesn’t have a statewide solar tax credit, residents can take advantage of the federal solar tax credit to help lower their solar costs. The federal tax credit, sometimes called the investment tax credit (ITC) or residential renewable energy credit, equals 30% of solar installation costs and directly reduces your income tax liability.
On average, a solar panel system in Florida will earn a tax credit of $7,560. Exactly how much you save with the solar tax credit depends on how much your solar power system costs, how many solar panels you install, and the solar company you choose.
The key thing to remember about the federal tax credit is that it lowers what you owe Uncle Sam, not the upfront cost of your solar energy system. You’ll see the savings when you file your taxes for the year.
If you finance your solar panels through a solar lease or power purchase agreement, you won’t get the benefits of the tax credit. If you use a loan, be aware that most solar loan providers require you to pay the value of the tax credit after 18 months to keep your payments low.
Quick Facts
Value: 100% of added property value from renewable energy system exempt from assessment
Frequency: Annually
How to apply: Consult local property tax assessor
Solar panels have many benefits, one of which is increasing property value. While solar panels add value to your home, that also means your property taxes should increase. However, Florida legislation exempts the value of solar panels from property tax assessments. So your house will be worth more with solar, but you don’t have to worry about higher property tax bills thanks to the solar property tax exemption!
According to AARP, the effective property tax rate in Florida is about 0.91%. Based on the median home value and the estimated value solar panels add to a home, the solar property tax exemption can save Florida homeowners an average of $250 per year!
Quick Facts
Value: Solar equipment is exempt from state sales and use tax
Frequency: One-time at the time of purchase
How to apply: Submit Florida Department of Revenue form to vendor at purchase
Solar equipment is exempt from Florida’s 6% sales and use tax. As the homeowner, you don’t have to worry about submitting forms for this, as the solar installer is the one who purchases the equipment.
While you won’t directly see the sales tax exemption, it helps keep the cost to installers low, making solar cheaper for you!
Quick Facts
Electric rates average $0.14 per kWh in Florida
Florida’s investor-owned utilities offer full retail net metering
Excess solar power is credited at the retail rate of electricity
Net metering is a method utilities use to bill customers who install solar panels. Under net metering, solar energy generated on your roof is used by your house first. When your solar panels produce more electricity than your home needs, it gets sent to the utility grid in exchange for a bill credit that can offset the cost of electricity you use from the electric company later.
The value of these bill credits can vary depending on your utility, but Florida requires the major investor-owned utilities (Florida Power & Light, Duke Energy, Florida Public Utilities, and Tampa Electric Company) to pay you the full retail rate of electricity when you send excess energy to the grid. Basically, the rate you pay for electricity is how much you will get credited.
This is called full retail net metering, and it’s the best solar buyback plan for homeowners. Because of the state's net metering policy, Floridians can save a substantial amount of money on their electricity bills.
If you are serviced by an electric cooperative or local electric utility company, full retail net metering may not be available.
In addition to solar incentives, there are two unique financing options available in Florida:
Property Assessed Clean Energy Program financing, and
Solar and Energy Loan Fund
These financing options aim to increase accessibility to solar energy by offering loans that are easier to obtain than traditional solar loans. However, be sure to fully understand how these programs work, as some people believe they prey on middle—and low-income homeowners who don’t realize what they’re being offered.
PACE financing is available in Florida, California, and Missouri. Instead of being tied to you as the borrower, PACE loans are attached to your property and you repay the amount through an increase in your property taxes.
Financing through PACE generally provides lower interest rates, requires no money down, and it’s incredibly easy to get approved, as it’s based on your property’s equity, not your personal finances.
But be aware that paying for solar panels with a PACE loan usually places a lien on your property, which can make it difficult to sell. In fact, some mortgage lenders won’t approve mortgages for homes with a liem from a PACE loan. Also, if you fail to make payments, you could lose your home since the loan is secured by your property.
The Solar and Energy Loan Fund (SELF) is a non-profit organization that provides low-interest loans for various home improvement projects, such as air conditioning, weatherization, energy efficiency upgrades, and solar panel installations.
SELF loans do not have credit score requirements or income limits. When considering a SELF loan, be mindful that just because you can be approved for it doesn’t mean you can afford it. Carefully review your budget and see if these loans are a realistic option.
Florida does not have any battery rebates or incentive programs for homeowners interested in energy storage. However, battery installations qualify for the federal solar tax credit, meaning you can get a tax credit equal to 30% of energy storage system installation costs.
A Tesla Powerwall battery costs about $15,000 fully installed, which would earn a tax credit of $4,500. The total tax credit will vary depending on the design of your storage system and the cost of installation.
The biggest benefit of solar batteries in Florida is that they can provide backup power when the grid is down. With power outages becoming more frequent during hurricane season, some Floridians may find that this alone makes battery storage worth the cost. However, if you’re looking at it from a financial perspective, solar batteries won’t save you any additional money on your electric bills.
The average cost of solar panels in Florida is about $25,200 before incentives for an 8.4 kilowatt (kW) solar panel system. This is equal to about $3.00 per watt of solar installed. Once the federal solar tax credit is applied, the price drops to about $17,640 to install a solar photovoltaic system in Florida.
Federal tax credit: $25,200 x 30% = $7,560
Total savings: $7,560
Effective system cost: $25,200 - $7,560 = $17,640
Remember that the total amount you pay for solar energy will depend on the number of solar panels you need and the cost of your installation.
The combination of the federal solar tax credit, Florida’s full retail net metering program, and abundant sunshine make going solar in Florida a great investment. In fact, solar panels can pay for themselves in a little over nine years, leaving you with 16 years of free, clean energy to power your home.
To make sure you get the best deal on solar panels, you need to find a solar installer that you trust. While the cheapest quote might sound the best, you don’t want to sacrifice installation quality. That’s why our solar experts recommend getting at least three solar quotes. By comparing multiple solar quotes, you can ensure you’re getting the best installation at the right price.
Finding an installer can seem overwhelming. Don’t worry—SolarReviews can help with that. We can connect you with local, pre-vetted solar professionals, making your solar journey as easy as possible. We also have an extensive list of the best solar companies in Florida with real customer reviews to help you make the right decision for your home, so you can worry less about your high electricity bills and more about what matters.
Catherine has been researching and reporting on the solar industry for five years and is the Written Content Manager at SolarReviews. She leads a dynamic team in producing informative and engaging content on residential solar to help homeowners make informed decisions about investing in solar panels.
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