Policy expert shares solar incentives guide that could unlock thousands in savings — here's the most lucrative advice

"The cost of solar has dropped significantly over the last decade and can save you thousands over the lifetime of your system."

EnergySage has dropped a guide to the potential savings you can take advantage of when you install solar panels on your property. 

Here is where to get started.

The scoop

The upfront cost of installing solar panels can put some prospective buyers off, with total setup prices averaging about $31,460, according to EnergySage. However, with rebates and incentives, you can reduce the cost of going solar and even get a faster return on your investment.

Spencer Fields, director of insights at EnergySage, broke down the main two types of incentives and rebates in a video.

In the video, Fields explains the difference between lump sum rebates and performance-based incentives. 

Lump-sum rebates are normally tax credits that get paid out within a year of installing your solar system. The most beneficial of these is through the Federal Investment Tax Credit. This tax credit allows you to recoup 30% of the cost of the system in your taxes. Fortunately, new buyers of solar systems can enjoy this tax credit at least through 2032 thanks to the 2022 Inflation Reduction Act.

Fields also explains that you can stack state incentives for solar panels and systems on top of the federal rebates, as well as potential savings from your installer, utility, or manufacturer of the system.

The other type of savings comes from performance-based incentives that are paid out over time, sometimes from 10-20 years, based on the energy produced from your solar system or its environmental impact. The types of payments can come in the form of a direct deposit, depending on your contract.

There are also other potential savings from each state, subsidized low-interest loans, grants, and more. You can check out EnergySage to learn more about the potential savings in your area.

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How it's helping

To summarize, Fields says the important thing to remember is that the biggest financial savings from going solar comes from your utility bills, and these add up over time to huge savings.

"Every month you pay an electricity bill is a month you could have saved money going solar," Fields says.

According to EnergySage, you can save between $31,000 and $100,000 on electricity just during the lifetime of your solar panel system. With an increase in home prices, as Forbes reports, saving money on your living expenses can go a long way.

In addition to the monetary savings, solar energy is a renewable source that can help eliminate the harmful effects of dirty energy, which contributes to planet-warming weather disasters. 

What everyone's saying

With high upfront costs, it can be frightening to consider paying for a solar system. But, when should you invest in solar energy? 

"Now is the best time," said John Burke, director of the Maine Solar Energy Association.

With increased tariffs and a reduction in subsidies from the federal government, the Federal Tax Credit could be in jeopardy. According to Solar.com, the credits may start diminishing by 2026.

"Since we're spending so much money on this, the federal credit was just the way for us to get [solar]," homeowner Jorge Solares told NPR. "Otherwise it's just too expensive."

With EnergySage's free tools that help you discover the potential price of investment for solar and potential savings, you can start the switch today.

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