Last updated: December2024
Written by
Catherine Lane
Louisiana homeowners can save $4,500 on solar panel costs through solar incentives. According to the U.S. Energy Information Association, homes use more energy in the Bayou State than in any other state, so it’s no surprise that Louisanans are looking into solar power systems to lower their high electric bills.
We’ve created a complete guide to what you need to know about Louisiana solar incentives and rebates so you can decide if going solar is the right investment for you.
Incentive | Estimated average annual savings | Eligibility | About |
|---|---|---|---|
Federal solar tax credit | $4,500 | All tax-paying U.S. citizens | Tax credit equal to 30% of installation costs, applied to federal income taxes |
Louisiana solar property tax exemption | $90, varies with property and solar system value | Louisiana homeowners who install solar panels | Value of solar panels is exempt from property tax assessment |
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
The most significant incentive for going solar in Louisiana is the Residential Clean Energy Tax Credit, sometimes called the federal solar tax credit. The solar tax credit equals 30% of solar panel system installation costs and reduces what you owe Uncle Sam in federal income taxes.
A typical solar installation in Louisiana is about 5 kilowatts (kW) in size and will save $4,500 with the federal solar tax credit. Your final tax credit value will depend on how many solar panels you install, the solar equipment you use, and the solar company you choose.
Remember, the federal tax credit isn’t an upfront incentive. You’ll still pay the full price for your solar installation and get the savings when you file your tax return for the year.
Quick Facts
Value: Exemption of solar system value from property tax assessment
Frequency: Annually
How to apply: Review local property assessor requirements
Solar panels can increase home value by an average of 6.8%. Louisiana residents don’t have to worry about the added value of raising their property taxes, as the state offers a 100% exemption of solar energy systems from property tax assessments.
According to The Tax Foundation, Louisiana’s average property tax rate is 0.5`%, meaning the exemption can save a typical home $90 per year through the solar property tax exemption.
Quick Facts
Electric rates average $0.12 per kWh in Louisiana.
Louisiana does not require utilities to offer net metering.
Utilities like Entergy and SWEPCO do have solar buyback plans.
Most available buyback plans credit excess solar energy at about $0.03 per kWh
Two of the largest utility companies in Louisiana, Entergy and SWEPCO, offer solar buyback plans to their customers who install home solar panels.
Under these plans, you can sell your excess energy back to the utility grid for an energy bill credit. These bill credits are worth about $0.03 per kilowatt-hour, about a quarter of the full retail rate companies charge for electricity.
Because Louisiana utilities don’t offer full retail net metering, homeowners here can’t save as much money on their electricity bills when they go solar as in other states. But installing a properly sized system and pairing it with a solar battery can help you get the most bang for your buck.
There are no solar battery rebates or incentives in Louisana. However, energy storage does qualify for the federal solar tax credit — even when it’s not paired with solar panels!
Solar batteries cost a minimum of $15,000, which would earn a tax credit of about $4,500. That’s a high upfront cost, but installing a battery is the only way to ensure you get the full value of your solar energy in Louisiana, giving you better energy savings on your monthly bills. Plus, batteries are a backup power source, so they can keep your lights on during a blackout.
Solar panel installations in Louisiana cost about $3.00 per watt of solar installed, which works out to about $15,000 for the average 5 kW solar system. Once you consider the solar tax credit, the cost of solar panels in Louisiana reduces to about $10,500.
Federal tax credit: $15,000 x 30% = $4,500
Total savings: $4,500
Effective system cost: $15,000 - $4,500 = $10,500
The average cost of installing solar is just that — an average. How much you end up paying for solar can vary widely depending on your home’s energy usage, how many panels you need, and what your installer charges.
Despite a lack of robust solar incentives, Louisiana homeowners can still see decent savings when they install solar panels thanks to the federal solar tax credit and electricity bill savings.
However, you should seriously consider whether solar PV systems are worth it. If your local utility company doesn’t offer a solar buyback program, you may want to skip out on solar. But programs like the one provided by Entergy can still lower your monthly electric bill, even potentially eliminating your energy charges.
We get it. Deciding if solar energy makes sense for you is overwhelming, but you don’t have to do it alone. The best way to know if solar is right for your home is to speak with trusted solar companies in your area.
SolarReviews can help connect you with the best solar companies in Louisiana who know your neighborhood just as well as you do. We match you with reliable, pre-vetted installers so you have one less thing to worry about when trying to gain energy independence and power your home with renewable energy.
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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