Florida residents can take advantage of multiple solar incentives in the state, from the federal tax credit to property and sales tax exemptions.
Updated:
Apr 5, 2024
Written by
Leonardo David
Leonardo David
Solar Writer
Edited by
Tori Addison
Tori Addison
Solar Editor
Florida has ranked among the top three states to go solar since 2019, with enough solar installed to power over 1.2 million homes across the Sunshine State, according to the Solar Energy Industries Association (SEIA). In addition to its abundant sunshine, homeowners can take advantage of several solar incentives in Florida including property and sales tax exemptions.
Florida State Solar Incentives
As of 2024, Florida offers a sales tax exemption and a property tax exemption for solar energy systems. Solar rebates and grants are not currently available in Florida.
The Solar and CHP Sales Tax Exemption
- Estimated savings: Applies to the Florida sales tax or 6% of solar photovoltaic (PV) system costs
- How to claim: One-time incentive that is automatically applied when you purchase a solar energy system
Florida introduced a sales tax exemption for solar energy and combined heat and power (CHP) systems in July 1997. The incentive was originally slated to only last five years, but the state converted the sales tax exemption into a permanent benefit. The sales tax exemption applies to the following:
- The retail rate of solar panels, solar heaters and combined heat and power systems
- It is available for residential, commercial and agricultural uses
Floridians don’t pay sales tax when purchasing a solar energy system, regardless of the size of your system. However, you must use solar equipment certified by the Florida Solar Energy Center to qualify for the exemption. The solar sales tax exemption does not involve a complex process — you are simply not charged the 6% sales tax when purchasing an eligible solar panel system in Florida.
The following table shows how much you could save with the 6% sales tax exemption when purchasing a home solar system in Florida:
| System Size | System Cost | Cost After Federal Tax Credit |
|---|---|---|
| 5 kW | $16,550 | $11,585 |
| 6 kW | $19,860 | $13,902 |
| 7 kW | $23,170 | $16,219 |
| 8 kW | $26,480 | $18,536 |
| 9 kW | $29,790 | $20,853 |
| 10 kW | $33,100 | $23,170 |
*Prices sourced from SunPower
Property Tax Abatement for Renewable Energy Property
- Estimated savings: Depends on your county’s property tax rate
- How to claim: Your solar system is automatically excluded from your property tax value
Home improvements can increase the assessed value of your property, which normally means you have to pay higher property taxes. However, Florida has the Property Tax Abatement for Renewable Energy Property, so you are not taxed for any increase in home value after installing solar panels. This exemption works as follows:
- Your property taxes remain unchanged if your home becomes more valuable due to a solar panel installation.
- This incentive was introduced in July 2013 and will remain available through December 2037.
So say you own a $400,000 home in a Florida county with a 1.02% property tax, equivalent to $4,080 per year. Even though your home value increases to $425,000 after installing solar panels, your annual property tax will remain at $4,080. Comparatively, another home upgrade of the same value ($25,000) would add $255 to your annual tax burden.
Local Solar Incentives
As of 2024, Florida does not have incentive programs covering specific regions or cities, beyond the statewide programs discussed above. So you will not qualify for additional incentives just for living in Orlando or Tampa, for example. The Jacksonville Electric Authority (JEA) used to offer a $4,000 rebate program for solar battery storage systems, but the incentive has been removed from their official website. However, JEA still offers incentives for energy efficiency and solar water heating in Jacksonville.
How To Claim Local Incentives
Solar programs are constantly changing, and governments can introduce new incentives at any time. Before installing a rooftop solar system in Florida, check that you are not missing out on any local incentives. You should check trusted references such as city and county government websites and your local utility company website. You can also ask your solar installer since companies keep track of all available financial incentives.
Florida Net Metering Explained
The amount of electricity your solar panels produce depends on the available sunshine. Solar PV systems tend to reach their highest output around noon, and there are times when energy production will exceed your home consumption. With net metering, you can earn credits towards your utility bill by sending that excess solar energy to the local electric grid. Here’s a breakdown of how net metering works:
- The local electric company measures your surplus solar generation using a smart meter.
- You get credit for any surplus solar energy, which is subtracted from your monthly electricity bill.
- If there is a month where your solar generation credit is higher than your consumption, the difference is rolled over to the next month
Florida Power & Light (FPL) and Duke Energy are the two largest electric utility companies in the Sunshine State, and both offer net metering programs. These utility companies offer net metering for solar power systems up to 2,000 kW of capacity, which is hundreds of times larger than the typical home installation.
The state classifies homeowners who participate in net metering into three tiers based on their solar system capacity. This determines your application fees and insurance requirements, as shown in the following table:
| Solar PV Capacity | Classification | Application Fee | Proof of Liability Insurance |
|---|---|---|---|
| Below 10 kW | Tier 1 | None | None |
| 10–100 kW | Tier 2 | $400 for FPL and $240 for Duke Energy | Up to $1 million |
| 100–2,000 kW | Tier 3 | $1,000 for FLP and $750 for Duke Energy | Up to $2 million |
Since home solar systems are typically below 10 kW, most homeowners can participate in Florida’s net metering programs without an application fee or an insurance requirement.
How To Enroll in Net Metering
To participate in a net metering program, solar owners must meet the following eligibility requirements:
- Florida solar panel systems must meet the National Fire Protection Agency (NFPA) National Electrical Code.
- Your system must have a UL 1741 solar inverter capable of disconnecting from the grid during a power outage or a visible disconnect switch.
- You must have a bidirectional power meter installed by the local utility company.
- You must have approval from a qualified local inspector.
If applicable, solar PV system owners must pay the application fee and show proof of liability insurance to participate in net metering. This requirement does not apply to solar systems below 10 kW, which includes most residential installations.
Federal Solar Tax Credit
The federal solar tax credit, officially called the Investment Tax Credit or ITC, is a nationwide incentive that allows you to claim a tax credit for your solar installation costs. The credit offers solar owners a tax deduction equivalent to 30% of their total system costs. You can combine it with other local incentives, such as sales tax and property tax exemptions in Florida.
The solar federal tax credit dropped to 26% in 2020, but the Inflation Reduction Act restored the original 30% rate in 2022. The credit will remain available through 2034 before being phased out according to the following schedule:
- The credit will decrease to 26% in 2033
- The credit will decrease to 22% in 2034
- Unless renewed by Congress, the credit will phase out entirely in 2035
You can only claim the credit once for the tax year you install solar. So assuming you install a 5-kilowatt (kW) home solar system for $13,000, the applicable ITC is $3,900. You can deduct this amount from your next annual federal tax declaration. If the tax credit is higher than the amount of taxes you owe, you can apply the difference the following year.
The solar investment tax credit for residential owners is covered in Section 25D of the U.S. Internal Revenue Code, while the solar tax credit for businesses is covered in Section 48.
Estimated Solar Savings in Florida
According to our research , Floridians can expect to save around $23,890 throughout the lifetime of their solar system and recover the upfront cost of installation after 9 years of use. To estimate these savings, we used average annual electricity rates from the U.S. Energy Information Administration (EIA), the specific photovoltaic power output (PVOUT) from the Global Solar Atlas and the average cost of installing a 6kW system in Florida of $19,860 before incentives.
Quality residential solar panels have a life expectancy of 25 to 30 years. In other words, you will get 16 to 21 years of solar panel use after you’ve fully recovered the upfront cost of solar, and can continue to save and earn money with them through net metering.
Are Solar Panels Worth it in Florida?
We at the MarketWatch Guides team recommend installing solar panels in Florida since the state offers multiple benefits for photovoltaic (PV) systems, electricity bills in the state are higher than average, and the state receives year-round sunshine ideal for solar power production. All of these factors allow homeowners with solar to save over $20,000 throughout the lifetime of their panels.
Some of the key ways you can benefit from going solar in Florida are:
- A state sales tax exemption offers upfront savings on your solar purchase.
- A property tax exemption helps to reduce system ownership costs over time.
- You can also claim the 30% federal solar tax credit to lower your upfront system cost.
- The state’s abundant sunshine can result in higher solar energy outputs and more power bill savings.
- The state’s available net metering programs compensate you in electricity bill credits for excess solar energy generation.
Reputable solar companies offer a free consultation to analyze your roof conditions and estimate your potential savings. This way, you can decide if going solar makes sense financially before accepting any offers. Consider getting quotes from our top recommended companies in the state using the table below to help decide solar is the right decision for you.
| Company | Star Rating | Cost of an 8 kW System* | BBB Rating | Visit Site |
|---|---|---|---|---|
| $24,000–$36,000 | A+ | |||
| $20,000–$25,000 | A+ | |||
| $25,000–$30,000 | A+ | |||
| $20,000–$25,000 | A+ | |||
| $25,000–$27,500 | A+ | |||
| $20,000–$25,000 | A+ | |||
| $20,000–$22,500 | A |
| Company | BBB Rating | Star Rating | Cost of an 8 kW System* | Visit Site |
|---|---|---|---|---|
| A+ | $24,000–$36,000 | |||
| A+ | $20,000–$25,000 | |||
| A+ | $25,000–$30,000 | |||
| A+ | $20,000–$25,000 | |||
| A+ | $25,000–$27,500 | |||
| A+ | $20,000–$25,000 | |||
| A | $20,000–$22,500 |
Frequently Asked Questions About Florida Solar Incentives
Homeowners can take advantage of a sales tax exemption and a property tax exemption when installing solar panels in Florida. The state also offers a favorable net metering policy that compensates you when your panels generate excess power that gets sent back to the grid.
Florida does not have a state income tax, which means there are no local tax credits for solar power. However, you can claim the nationwide federal solar tax credit, which equals 30% of your total system cost.
There are no programs that offer free solar panels in Florida. However, some solar panel financing options allow you to go solar at zero upfront cost, including a solar loan or lease. You can then pay the solar loan or lease over time using your energy bill savings.
With solar panels, Florida homeowners can take advantage of the state’s abundant sunshine — and a 6 kW home solar system can save you over $1,000 on energy bills per year.
You can also participate in the state’s net metering programs, which give you power bill credits for any excess solar energy your panels generate. Plus, since Florida has a property tax exemption for solar panels, going solar can increase your home value without raising your property taxes.
