Delaware Solar Incentives, Tax Credits And Rebates Of 2024

Unlike many other states, Delaware doesn’t offer property tax exemptions for the increased value of your home after solar installation, but the Diamond State does offer several other solar incentives that make the investment worthwhile.

Incentive	Description	Type	Occurrence
Federal Solar Tax Credit	30% nonrefundable tax credit to lower your tax liability	Non-refundable tax credit	One time (can carry it over)
Net Metering	Bill credits for sending more energy to the grid than your home uses from the grid	Payment or bill credit	Every month
SRECs	Credits sold to utility companies to help them meet state-mandated green initiatives	Compensation	Ongoing
Green Energy Program	Local grants for installing solar systems	Rebate	One time
Low- to Moderate- Income Solar Program	Discounted or free solar panel installation for low- to moderate-income households	Discount	One time

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Federal Solar Tax Credit

The best Delaware solar incentive isn’t actually specific to Delawareans; anyone in the United States who outfits their home with a solar system is eligible. It’s the federal solar tax credit, officially called the Investment Tax Credit (ITC). This credit is worth 30% of the total cost of your solar panel installation, in the form of a reduction of your overall tax liability when you file the following April.

The federal tax credit isn’t permanent: Under current law, the tax credit will decrease to 26% in 2033 and then to 22% in 2034. Starting in 2035, the tax credit will go away entirely, unless Congress extends or modifies it.

Do note that this is a non-refundable tax credit, meaning the most it can do is lower your tax liability to $0. Uncle Sam won’t cut a check for the amount that’s left over. Instead, you can carry over any remaining portion of the tax credit to apply to future tax years, as long as the tax credit is still in place.

If you’re not sure how a 30% tax credit will impact your finances, work with a tax accountant before installing solar panels.

Delaware Net Metering

Delaware residents who upgrade their homes to solar power can take advantage of net metering. Net metering allows energy companies to monitor how much electricity you’re using from the grid versus how much you’re generating via solar and sending back to the grid. If you send more energy to the grid than you use from it, the power company will issue a bill credit, meaning you can greatly reduce—or entirely eliminate—your monthly utility bill.

Solar Renewable Energy Credits in Delaware

In Delaware, homeowners with solar panels are eligible for Solar Renewable Energy Credits (SRECs). For every 1 megawatt hour (or 1,000 kilowatt hours) that a solar system generates, the homeowner earns a single SREC, which they can sell back to the utility companies. This helps utility suppliers meet their state-mandated renewable portfolio standards. Prices fluctuate based on supply and demand.

Green Energy Program Grants and Rebates

On a more local level, Delawareans can earn rebates through their utility companies via the Green Energy Program. For instance:

• Delmarva Power and Light customers can get a cash rebate when installing a solar panel system, up to $6,000.
• Delaware Electric Cooperative customers can also get a rebate, but the rate varies depending on the size of the system: $0.50 per watt up to a 5-kW system (max $2,500 rebate) and $0.20 per watt for larger systems.
• Municipal customers can also get local rebates when installing a solar system.

All of these programs are current as of this writing, but be sure to inquire with your utility company for the most up-to-date information.

Low- to Moderate-Income Solar Pilot Program

Delaware also offers a program to help low- to moderate-income households obtain solar energy. Homeowners can get a reduced-cost solar panel installation through this program or, in some cases, one that is entirely cost-free.

A Note on Taxes

Many states offer property tax exemptions when installing solar, meaning you won’t see property taxes go up despite the increased home value from installing solar. Unfortunately, Delaware does not offer this exemption.

Many states also exempt solar panel purchases from sales tax, but Delaware does not have such an exemption. Why? Delaware doesn’t have a state sales tax at all, so there’s nothing to exempt.

On average, solar panels cost $14,897 in Delaware when purchasing a 6-kW system, before the 30% federal solar tax credit. After the 30% credit at tax time, Delawareans will have effectively spent $10,428 on the 6-kW system on average.

Homeowners in the Blue Hen State should expect to spend $2.48 per watt on solar panels. Solar panel costs will vary depending on how many solar panels you need, the size and accessibility of your roof, where in Delaware you live, whether you purchase a storage system and the solar panel brand you choose.

System Size	System Cost	System Cost With Federal Solar Tax Credit Applied
6 kW	$14,897	$10,428
8 kW	$19,840	$13,888
10 kW	$24,800	$17,360

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It is absolutely worth it to install solar panels on your Delaware home. The primary motivation for many will be environmental: By installing solar panels on your home, you’re doing your part to reduce our reliance on fossil fuels, which have a finite supply and harm the environment.

But going solar isn’t only a selfless act—it’s also a financially wise one. For starters, you have less than a decade to make the move and still earn that  30% tax credit from the federal government. But that’s just the tip of the iceberg: With local grants, net metering and SRECs, homeowners in the Blue Hen State can save and earn money for going solar. How much money solar panels save you depends on the system, where you live, your family’s energy consumption and the brand you purchase, but we estimate roughly $125 a month in savings.

Converting to solar power also increases the value of your home by an average of 4%, which means you’ll get potentially higher offers when you’re ready to sell. By choosing the best solar panels—the longest-lasting, highest-quality, most durable—you’ll ensure you get the most bang for your buck while you enjoy them and when it’s time to list your home.

Bottom Line

Delaware residents have a golden opportunity to make a difference in the world and save money by switching to solar. With a host of tax credits, compensation methods, grants and rebates, investing in solar panels can be a lucrative decision for Delaware homeowners.

Start the process by researching the best solar companies in your area, and talk with your chosen installer, your utility company and your accountant about all the solar incentives available to you.