WASHINGTON COMMERCIAL

Incentives

2023 WAShINGTON State Commercial Incentives

Federal incentives, state tax breaks, and efficient solar panels give Washington business owners the opportunity to take advantage of incredible financial benefits when switching to solar.

When you switch to solar, we’ll take care of the majority of your incentive paperwork. All of our solar systems come with free project management support, and we’ll supply all the information necessary for your tax documents and communicate with your tax professional as needed.

Washington State Solar Tax Exemption

As of July 1st, 2019, all solar systems smaller than 100 kilowatts are exempt from state and local use tax. This tax exemption helps Washington business owners save thousands of dollars when installing solar panels on their property. For a standard-sized solar system, this equates to saving $6,000+ on the overall cost of going solar.

This statewide solar tax exemption extends through 2029 and pairs well with the Federal Solar Investment Tax Credit.

Here’s how the State Solar Tax Exemption Works

All tax obligations are waived when you purchase solar in the state of Washington. The tax rate of the city that you do business in will determine how much you’ll save in overall costs. As an example, if you live in Longview, Washington you will save 8.1% on the overall cost going solar. If you live in Tacoma, Washington, you will save 10.2% on the overall cost of going solar.

Find out how much you’ll save with this sales tax calculator.

Federal Solar Investment Tax Credit (ITC)

Our Federal government incentivizes businesses to purchase solar by reducing the barriers to entry. This incentive lowers your federal tax obligations on a dollar-to-dollar basis, through a cash rebate. There is no ceiling on this tax credit. The Federal Solar Investment Tax Incentive is worth 30% of the total purchase price of your solar system, no matter the system size or cost.

Currently, the 30% Federal Solar Income Tax Credit applies to all solar projects that begin construction in 2023. The 30% tax credit will last through 2033, at which point it will drop to 26%.

Here’s how the Solar Investment Tax Credit works

For every dollar your solar system costs, the federal government will award you 30 cents back in tax credits. This is how you reduce your overall federal tax liability. This is a dollar-for-dollar tax rebate, not a tax write-off. There is no ceiling on the amount of tax credits you can be awarded – the 30% credit applies, no matter the size of your solar system.

Understanding Cost

You will receive 30% of the total cost of your solar system on your next year’s tax return. For instance, if the final purchase price of your new solar system is $20,000, you will get an additional $6,000 back from the federal government.

Calculation example 1:

$50,000 cost x 0.30 rebate = $15,000

In this example, you will receive an extra $15,000 back from the federal government.

Calculation example 2:

$100,000 cost x 0.30 rebate = $30,000

In this example, you will receive an extra $30,000 back from the federal government.

Rural Energy For America Grant Program

The REAP Program offers grants and guaranteed loans to rural businesses and agricultural companies throughout America. The grants are renewable energy focused and include the purchase of commercial solar systems.

The REAP Program has 2 primary goals:

1. To enhance energy independence by creating a greater supply of clean, renewable energy in the commercial sector

2. To reduce energy demands

Over time, the REAP Program hopes to decrease the overall energy costs for businesses in the agriculture sector and in towns of less than 50,000.

REAP Grant Terms:

The Rural Energy for America Program offers grants ranging from $1,500 to $250,000. Solar installations that exceed $200,000 must have a technical report and an on-site evaluation completed prior to starting the installation. Grant applicants must provide at least 75% of the total cost of the solar installation in order to qualify.

REAP Loan Terms:

• $5,000 minimum and $25 million maximum loan amounts

• Up to 85% loan guarantee

• Maximum term of 30 years for real estate

• Maximum term of 15 years for equipment

• Maximum term of 30 years for combines equipment and real estate

• Maximum term of 7 tears for capital loans

Loan applicants must provide at least 25% of the total cost of the solar installation in order to qualify.

Who Is Eligible?

1. Agricultural producers who generate a minimum of 50% of their gross annual revenue from farming

2. Rural small businesses residing in qualified areas

How To Qualify:

1. You must be the owner of the business

2. You must have no outstanding federal taxes, judgement or debarment

3. Your business must be financially solvent

Qualified Locations

Agricultural producers can reside in either a rural or non-rural area. Small non-agriculture businesses must be located in rural areas to qualify. ‘Rural’ is defined as a location that is not considered ‘a city or town with more than 50,000 inhabitants.’ Here’s an eligibility map to determine whether your business resides in a qualified area.

How To Apply For REAP Grants and Loans

You can find the REAP Application here. Applications for grants, loans, and grant/loan combinations are due by March 31st, 2023. Submit your application to your state office.

To apply, you have to be enrolled in the System for Award Management and have a Dun & Bradstreet number. These are both free of charge, but can sometimes be time-consuming. Be sure to prepare in advance if you plan on submitting a REAP application.

As soon as you’ve signed up with the System for Award Management and Dun & Bradstreet, you can apply to the REAP program. Application instructions for the REAP Program can be found on the REAP website.

The REAP Program’s 3 Tiers

Tier 1: Solar installations that will cost less than $80,000

Tier 2: Solar installations that will cost more than $80,000 and less
than $200,000

Tier 3: Solar installations that will cost more than $200,000

When applying, be sure to fill out the appropriate application based on the tier you’ll be in.

Planning Is Critical

Thoroughly preparing before you apply will greatly improve your chances of being approved for the REAP grant. Be sure to get in touch with your state’s energy coordinator as soon as possible. They will need to conduct an environmental review of the installation site before you begin your application. Months before the REAP Application deadline of March 31st, 2023, you’ll want to make sure you’ve applied to the System for Award Management and Dun & Bradstreet.

Below is a list of other things you may need to supply during the application process:

• Bank statements

• Funding commitment from any other funding sources

• Interconnection agreement if you’re interconnecting with a utility company

• Documentation of any known associations with USDA employees

You Can Combine Solar Incentives

The REAP Grant can be combined with any of the other solar incentives available to you. The REAP application requires you provide a funding commitment statement that includes any other solar incentives you’ll be taking advantage of. For this reason, you’ll want to be sure to arrange other solar incentives first before applying to the REAP Program.

What is Net Energy Metering?

Typically, utility companies only need to keep track of the amount of energy you consume on a monthly basis. When you go solar, your utility company needs to keep track of the amount of energy you produce on a monthly basis. With Net Energy Metering, your utility company can keep track of both. At the end of the month, your power company will subtract the amount of energy you produce from the amount of energy you consume, reducing your monthly power bill. Any additional energy credits you store up will be carried over to your next month’s bill throughout the year.

Each kilowatt-hour of energy you produce is equivalent to the retail market value of a kilowatt hour of energy you purchase from your utility company. You can literally save up energy credits in the form of solar power created during the longer days of summer and then use them during the shorter days of winter.

Understanding Net Energy Metering

Imagine your new solar energy system generates 1,000 kilowatt hours of solar power in the month of June, but you only end up consuming 700 kilowatt hours of energy that month. You’d have an extra 300 solar credits that would carry over into the month of July. If you consume more energy than you produce, then the solar energy credits you have stored up would automatically be applied. Think of it as a sort of “energy storage bank.” Net Energy Metering keeps track of it all.

Washington Solar Cost Breakdown

TRUSTED BY THE NAMES YOU KNOW

WHAT OUR CUSTOMERS ARE SAYING

Don’t take it from us – hear it from customers like you.

We used Smart Solar Energy out of Medford Oregon to get solar panels installed on my home. They were referred to us by a friend and Jordan was the salesperson who helped us. He was very knowledgeable and explained all the pros and cons of going solar. In the end, the pros outweighed the minimal cons and helped my wife and I make the decision to go solar. The pricing was very competitive and the installation was done professionally. We always felt like we were being kept in the loop with them. They even checked back in to see how we were doing after the installation. Overall, we’re very happy with our decision and are glad to be saving some money!

Sylvia M.
Medford, Oregon

I care about saving money. I care about the investment known as my home. Working with Smart Solar Energy has been such a pleasure! As someone who cares about the environment, it’s important to me to make sure the company I go with feels the same way. They did a very thorough job and were careful to make sure I was aware of what the next steps were in the installation process. The process of getting the roof surveyed and getting solar panels was pain and stress free. I highly recommend Smart Solar Energy out of Bend Oregon because of the quality and respect they provided to me in this process of getting solar panels on my roof. As Oregon is progressing towards renewable energy, I’m glad Smart Solar Energy is the team I'm with. They work with you and for you. I highly recommend!

Jerry L.
Bend, Oregon

The search for solar is a daunting and scary task. With so many choices and so many options it makes it tough to decide which direction to go. Everyone is looking to make your money. Thankfully, I came across Smart Solar Energy in Portland, Oregon. The salesperson was incredibly honest and straightforward. The process was handheld all the way through till the end and they dealt with all my senseless worries and any problems that occurred extremely professionally and quickly. I recommend them to any and everyone that asks me about the solar on my home. Oh, and the work was done very nicely, panels look great, crew was very clean, and my place was left spotless after all was said and done. Highly recommend Smart Solar Energy to anyone looking to go solar!

Sally F.
Portland, Oregon

After almost 2 years of research and multiple solar power company interviews, none of them compared to Smart Solar Energy. They were very professional and thorough. I didn’t feel pressured anytime during the process. The solar consultant understood my needs and some of the headwinds I was facing with such a long term commitment. The fact that their installation company installed more solar in Oregon and Washington than anyone else, combined with the high quality panels made my decision that much easier. The installation went flawless even though some uneventful weather delayed it. The entire process from start to finish took about 40 days. I highly recommend that Smart Solar Energy out of Longview, Washington be one of your finalists when it comes to your solar energy needs.

Kathy T.
Longview, Washington

Just had my solar installed last week! After a year of research and quotes from companies, reviews, systems, material, panels used I finally decided on Smart Solar Energy out of Salem Oregon. Boy did my research payoff. Jordan the salesman explained everything. He didn't waste my time by trying to push me in a direction I wasn't interested. He was knowledgeable and helped me come up with a plan that fit best for what my wants and needs were. Then it moved to my project manager. He was there to explain where we were in the process and ensure it all was taken care of. Install day came. They did a great job and it looks great. They explained what they were doing throughout the process and how it all works together. After install they contacted me to explain how to monitor the solar being produced.

Rick H.
Salem, Oregon

SWITCH TO SOLAR & SAVE.

Are you ready to make the smart switch to green energy? Let’s talk.