Connecticut Solar Incentives: Tax Credits & Rebates Guide (2022)

By Jacob L.

Although Connecticut isn’t known as the land of solar, it is quickly becoming an excellent state to purchase and install solar panels. The development of new tech and a range of financial incentives have made it easier to produce solar electricity in less sunny climates. By having a solar power system in your home, you can ensure minimal initial system costs and steady savings for decades to come.

For these reasons and more, it is a great time to buy a new solar energy system in Connecticut. Keep reading to learn all about how your purchase and installation of solar panels in Connecticut can become cheaper and more efficient.

Why Go Solar in Connecticut?

Although it may not have a wealth of sunshine, Connecticut is a great place to invest in solar. With an average of 194 sunny days per year, Connecticut is not much below the American average of 205 sunny days per year. Despite its somewhat average sun coverage, Connecticut has benefited from rapid improvements in photovoltaic technology, which has increased the efficiency of solar panels so that even cloudier and colder climates can sustain solar energy production.

Connecticut is also an excellent state to purchase solar energy systems because of the existence of federal, state-level, and local financial and tax incentives designed to lessen the cost of buying and installing solar panels.

In particular, the government of Connecticut has a Renewable Portfolio Standard, which requires energy producers to produce a certain amount of electricity from renewable sources. Residents of Connecticut can benefit from the existence of many local solar providers throughout the state. These providers offer customers the opportunity to entertain a variety of competing quotes while making sure that they receive the best quality service and equipment.

Finally, solar panels can dramatically increase your home’s value. According to Zillow, the average home experiences a 4.1% increase in its value after the addition of a solar power system. In Connecticut, the average home value is $340,415, which means that homeowners can expect to see the value of their homes increase in value by an average of $13,957 after the installation of a photovoltaic energy system.

Connecticut Solar Cost

The total cost of solar installations in Connecticut ranges from $13,090 to $17,710. On a cost-per-watt basis, solar panel installation in Connecticut falls between $2.62 and $3.54. Given the national average of $3.00 per watt, Connecticut is far from the pricier end when it comes to buying solar energy systems.

You should also note that these costs have come down significantly in recent years. In fact, over the past five years, prices have dropped more than 45% in Connecticut. Obviously, if you purchase a larger system (more watts), you will end up spending more to gain additional energy production. With energy bills increasing amid high oil and gas prices, the relative cost of solar is surely bound to continue declining.

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How Much Can You Save on Solar in Connecticut?

Although you may face steep upfront costs to purchase and install your solar system, you can save lots of money per year, thanks to the electricity your system produces. The mechanism behind the savings functions in this manner: when solar panels produce electricity for your home, they reduce the amount of energy that you pull from the grid, thus lowering your utility bills.

People living in Connecticut save between $30,290 and $40,981 over a 20-year period. With a payback period ranging from 7.4 to 10 years, you can find yourself saving thousands of dollars per year in just close to a decade after purchasing your photovoltaic (PV) equipment.

The Best Solar Incentives, Tax Credits, & Rebates in Connecticut

There are several public and private incentives in Connecticut that help you save on your purchase of solar panels in Connecticut:

Incentive Summary End Date
Federal Solar Tax Credit (ITC) Connecticut residents can take advantage of the Federal Solar Tax Credit and get a discount of 26% applied to their tax returns. December 31st, 2022
Connecticut Solar Property Tax Exemption The state of Connecticut will exempt property taxes on the added value to your home derived from installing a solar energy system. None
Sales and Use Tax Exemption for Solar and Geothermal Systems In Connecticut, you can receive a state sales tax exemption of 6.35% on your purchase of a home solar system. None
Net Metering Net metering allows homeowners that create excess energy to use it as a credit on their next electric bill. All energy providers are required to offer this option to homeowners. None
Connecticut Green Bank Residential Solar Investment Program (RSIP) Residents of Connecticut can receive an upfront cost reduction of $0.426 per purchased watt based on system size (Max. size 10 kW). If you wish to take on a solar lease, you can receive compensation of $0.30 per kWh produced by the solar power system (Max. size 20 kW). None
Connecticut Green Bank Solar for All Program Eligible low-income households in Connecticut can access solar energy through a Power Purchase Agreement (PPA) at a special rate. This program is run through Connecticut’s Residential Solar Investment Program (RSIP). None
Energy Efficiency Loan Program The government of Connecticut offers loans for eligible families to purchase solar energy systems. These loans can amount to $40,000 for 5-12 years at interest rates between 4 percent and 7 percent. None
USDA REAP GRANT REAP assists agricultural producers and rural small businesses reduce their energy costs and consumption by providing loan financing and grant funding to purchase and install renewable energy systems. Eligibility for the REAP program is dependent on you being an agricultural producer, with at least 50 percent of your gross income coming from agricultural operations and small businesses in eligible rural areas. None
C-PACE Financing Program The government of Connecticut offers access to financing for energy-efficient power systems and upgrades through the C-PACE financing program. This program allows property owners to finance their purchase of solar energy systems and to pay back the money owed through a voluntary property tax assessment. While it may not lower the cost of going solar, it can be a great means of financing for homeowners that can’t take out traditional loans. None

Federal Solar Investment Tax Credit (ITC)

The Federal Solar Investment Tax Credit (ITC) is a 26% federal tax credit available for home solar systems purchased and installed by the end of 2022. This is a large chunk of money taken off their personal income taxes. Plus, the ITC has done a great job expanding the country’s solar industry. It has helped create hundreds of thousands of jobs while bringing billions of dollars into the economy since being enacted in 2006.

Connecticut Solar Property Tax Exemption

Connecticut will exempt property taxes on the added value to your home that comes with installing a solar energy system.

Connecticut Net Metering

Electricity companies in Connecticut have all adopted net energy metering, which is a policy that ensures your solar panels will be connected to the public-utility power grid, and that surplus power created by your panels will be transferred to the grid. You can offset the cost of power drawn from the electricity grid as a result of net metering.

The minimum amount of compensation that you’ll receive is the avoided-cost rate, which is below the retail rate. While the policy specifics of net metering programs will vary among providers, it remains hugely beneficial for owners of solar energy systems.

Sales and Use Tax Exemption for Solar and Geothermal Systems

In Connecticut, you can receive a state sales tax exemption of 6.35% on your purchase of a home solar system.

Connecticut Green Bank Residential Solar Investment Program (RSIP)

Residents of Connecticut can receive an upfront cost reduction of $0.426 per purchased watt based on system size (Max. size 10 kW). If you wish to lease your system, you can receive compensation of $0.30 per kWh produced by the solar power system (Max. size 20 kW).

Connecticut Green Bank Solar for All Program

Eligible low-income households in Connecticut can access solar energy through a Power Purchase Agreement (PPA) at a special rate. This program is run through Connecticut’s Residential Solar Investment Program (RSIP).

Energy Efficiency Loan Program

The government of Connecticut offers loans for eligible families to purchase solar energy systems. These loans can amount to $40,000 for 5-12 years at interest rates between 4 percent and 7 percent.

Commercial Connecticut Solar Incentives

Solar Incentives for Nonprofits and Businesses in Connecticut

Unfortunately, there are few to no specific financial incentives for businesses or nonprofits in Connecticut. The C-PACE Financing Program may be of interest to most property owners, however. The government of Connecticut offers access to financing for energy-efficient power systems and upgrades through the C-PACE financing program.

This program allows property owners to finance their purchase of solar energy systems and to pay back the money owed through a voluntary property tax assessment. While it may not lower the cost of going solar, it can be a great means of financing for homeowners that can’t take out traditional loans.

USDA REAP Grant

The United States Department of Agriculture (USDA) has launched a program designed to increase investments in clean energy called the Rural Energy for America Program (REAP). REAP helps agricultural producers and rural small businesses lower their energy costs and consumption by financing loans and grant funding to purchase and install renewable energy systems.

You are eligible to participate in the REAP program if you are an agricultural producer with at least 50 percent of your gross income coming from agricultural operations or a small business in eligible rural areas.

Key Takeaways: The Best Connecticut Solar Incentives

While you may not generally associate Connecticut with solar energy, it’s time that you start to do so. Thanks to its variety of financial incentives and rebates, and the emergence of newer solar technology, Connecticut is now an excellent place to launch your solar project. There is really no reason not to buy a solar energy system, especially with variable energy prices around the world and climbing utility bills at home. If you are interested in purchasing, there are many great companies that will help get you set up.

Connecticut Solar FAQ

Is solar worth it in Connecticut?

Yes, we highly recommend investing in solar energy systems in Connecticut. Solar can save you tons of money on your utility bills and help reduce your production of emissions and your carbon footprint. Plus, a variety of federal, state, and local financial incentives are available in Connecticut to make the purchase of solar panels accessible to anyone!

How much will my electricity bill go down with solar in Connecticut?

People living in Connecticut save between $30,290 and $40,981 over a 20-year period. With a payback period ranging from 7.4 to 10 years, you can find yourself saving thousands of dollars per year in just close to a decade after purchasing your solar PV system.

How much does it cost for solar panels in Connecticut?

The total cost of solar installations in Connecticut ranges from $13,090 to $17,710. On a cost-per-watt basis, solar panel installation in Connecticut falls between $2.62 and $3.54. Given the national average of $3.00 per watt, Connecticut is far from the pricier end when it comes to buying solar energy systems.

Can you get solar panels for free in Connecticut?

No, you probably won’t be able to get free solar panels in the state of Connecticut. However, residents of Connecticut are lucky to have the support of a large variety of federal, state, and local financial incentives that will help to minimize the costs associated with purchasing a new solar energy system.

What solar rebates are available in Connecticut?

There are many federal, state, and local financial incentives for purchasers of solar energy systems in Connecticut. These include the federal government’s Solar Investment Tax Credit (ITC), the Connecticut Property Tax Exemption, and many state incentives.

How many homes in Connecticut have solar panels?

There is enough solar installed in Connecticut to power nearly 150,000 homes, and solar accounts for 2.53% of the state’s electricity production.

Do solar panels increase property taxes in Connecticut?

No, your taxes won’t increase. This is because the state of Connecticut will exempt property taxes on the added value to your home that comes with installing a solar energy system. The property tax exemption provides yet another excellent reason to invest in solar!

How much can you write off for solar panels on taxes in Connecticut?

Connecticut taxpayers can choose to write off lots of the costs associated with the purchase of new solar panel systems. For more information about incentive programs, check out the Connecticut government’s website.

House Method’s Solar Companies Rating Methodology

At House Method, transparency and trust are our most important values for the reader. That’s why we took the time to create an objective rating system and score each solar energy company/service according to our methodology.

Our research team dug deep into the fine print of contracts, combed through more than one hundred customer reviews, and thoroughly investigated all of each solar energy company’s services, costs, and products. We’ve done the homework for you by researching nearly all of the solar energy companies on the market so you can have the information you need to make the best choice for your home.

We developed a formula to objectively determine the best solar energy companies and give each a score out of 100 based on the following criteria:

  • Plan Options (30): Do they provide a variety of plan options? We looked at the number of plans each solar energy company offered and the flexibility of adjusting the plan.
  • Services offered (20): How many services are offered in each plan? We looked at whether the company manufactures its own solar panels, whether it contracts out installation, and what additional products each company offers.
  • Trust (10): What do customers say after their solar panels are installed? Does this company offer a guarantee? We considered how satisfied customers are post-service if the company does what it says it will, BBB accreditation, and service guarantees.
  • Prices (10): How reasonable are the costs of the plan or service in comparison to the industry average? We compared the costs of each company to competitors that offer the same solar energy services.
  • Unique perks (10): Does the company offer discounts or special services such as financial incentives, rebates, or a useful mobile app? We looked for extras each company offers that set them apart from the competition.
  • Customer Service (10): How is the customer experience when contacting the company? We considered the speed of response, weekend/holiday availability, and ease of communication through phone calls, email, and online chat functions.
  • Nationwide availability (10): How many states does the company offer its services? Companies that operate nationally and in all zip codes are favored over those with limited availability.

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