Last updated: December2024
Written by
Jamie Smith
Oklahoma homeowners can save $5,502 on average on their solar installation throughsolar incentives offered in the state.
Investing in a renewable energy source like solar power has plenty of economic and environmental benefits – but it's a pretty big upfront cost. Incentives are put in place to help make solar energy a more accessible tool. Let's dive into what's available in The Sooner State.
Incentive | Estimated average annual savings | Eligibility | About |
---|---|---|---|
Federal solar tax credit | $5,502 | All tax-paying U.S. citizens | 30% tax credit applied to federal income taxes |
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
Oklahoma homeowners can take advantage of the 30% federal solar tax credit when they go solar. The credit is equal to 30% of the costs of an entire solar panel installation and is applied to federal income tax liability.
The average solar system in Oklahoma will earn a tax credit worth $5,502. Remember that you don't get this as an upfront payment. Like the way most tax incentives work, the federal tax credit reduces your income tax liability, and you won't see the benefits until you file your taxes for the year.
If your liability is less than the value of the investment tax credit (ITC), it will be reduced to $0, and the remaining credit value will be applied to next year's taxes. The credit can roll over for five years without an income limit.
Quick Facts
Electric rates average $0.12 per kWh in Oklahoma
Oklahoma does not offer full-retail net metering
Investor-owned utilities and electric cooperatives offers a net metering program at an avoided cost rate, less than the full retail value
The Oklahoma Corporation Commission requires utility companies to offer solar buyback plans to customers. However, excess solar energy sent to the grid does not have to be equal to the full retail rate of electricity, leading to lower overall solar savings.
Excess energy that is generated from solar energy systems can be sold back to the grid, but at an avoided cost rate. For instance, Oklahoma Gas & Electric (OG&E), one of Oklahoma's largest investor-owned utilities, offers a net billing program that compensates customers for around $0.02 to $0.08 per kWh of electricity sold back to the company.
Energy costs, credit rates, and bill savings will vary depending on what utility you're serviced by. Visit your utility website for more information for solar homeowners.
The average cost of a solar panel system in Oklahoma is about $2.62 per watt, making the average 7 kW system cost $18,340 before incentives. Once you consider the federal solar tax credit, the cost of solar panels falls to $12,838.
Federal tax credit: $18,340 x 30% = $5,502
Total savings: $5,502
Effective system cost: $18,340 - $5,502 = $12,838
We would like to see Oklahoma offer more incentives and rebates for residents who install solar. However, the solar investment tax credit will help save 30% on installation costs, which is huge! Also, while the state’s net metering program isn’t the strongest, it can still help residents with additional savings on energy bills.
Through bill savings, the average payback period for solar systems installed in Oklahoma is about 13 to 15 years. Considering solar panels last for 25 years or more, that could mean a decade of free, clean energy!
However, everyone’s home and financial situation is unique! We recommend consulting with local solar companies, shopping around for quotes, and weighing your options. SolarReviews can connect you with pre-vetted solar installers in, or you can research our expansive directory of the best solar companies in Oklahoma.
Jamie is a Content Writer and researcher at SolarReviews. A recent graduate of La Salle University in Philadelphia, Jamie earned her B.S. in communications with a concentration in journalism, mass media, and public relations.
Jamie has previously worked at a marketing company where she had the opportunity to highlight and promote small bu...
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