Greeley, CO

Colorado offers a Property Tax Exemption for residential solar systems that provides significant financial benefits to homeowners who install solar panels. Under this state tax exemption, renewable energy personal property located on residential property, owned by the property owner, and used to produce energy for that property is completely exempt from Colorado property taxation.

To qualify for this exemption, your solar electric generation system must be located on residential real property, primarily used to produce electricity for the residential improvements, and have a production capacity of no more than 100 kilowatts of AC electricity. This exemption only applies to the solar equipment itself, not the underlying real property. There is no expiration date for this incentive, making it a long-term benefit for Colorado homeowners who invest in solar energy.

Colorado offers a Sales Tax Exemption for solar equipment that eliminates state sales tax on components used in solar energy systems. This exemption applies to the state’s 2.9% sales tax as well as certain special district taxes like RTD and Cultural Facilities District taxes, providing immediate savings when purchasing solar equipment.

Eligible components include solar modules, supporting structures, inverters, wiring, control systems, and other essential parts of your solar installation. However, the exemption doesn’t cover labor costs, energy storage devices (like batteries), or remote monitoring systems. It’s also important to note that while state and special district taxes are exempt, most city and county sales taxes still apply unless they’ve specifically adopted the exemption by local ordinance. There are no expiration dates or deadlines for this ongoing incentive program.

Fort Collins Utilities offers solar rebates to help homeowners offset the cost of installing solar photovoltaic (PV) systems. Residential customers can receive $200 per kilowatt of DC generating capacity installed, up to a maximum of $1,000 for solar installations. Battery storage systems are also eligible for incentives at $150 per kWh of capacity, up to $3,000. The combined maximum incentive for a new system with both solar and battery storage is $4,000.

To qualify, homeowners must be Fort Collins Utilities electric customers and must work with a contractor from the Participating Solar Contractor Network. Systems must be at least 500 watts in size and meet Utilities Interconnection Standards. In exchange for the rebate, customers agree to assign 20 years of Renewable Energy Credits (RECs) to Fort Collins Utilities. Systems must be installed within six months of receiving the rebate reservation letter. Additionally, customers may be eligible for the 30% federal tax credit for solar installations completed before the end of 2032 (decreasing to 26% in 2033 and 22% in 2034).

The San Miguel Power Association (SMPA) Solar Rebates program offers financial incentives to homeowners and businesses installing renewable energy systems in their service area. Residential customers can receive $0.10 per watt for solar photovoltaic installations, up to a maximum of 3 kilowatts or $300. Commercial customers are eligible for the same rate of $0.10 per watt but with a higher cap of 10 kilowatts or $1,000. The program also includes similar rebates for small wind systems.

To qualify, your contractor must complete and submit the required rebate paperwork on your behalf. While contractors don’t need to be pre-registered with SMPA, they must meet certain eligibility requirements. Applications are subject to deadlines, so it’s important to check with SMPA Member Services at (970) 626-5549 or [email protected] for current timelines and to confirm your eligibility. For additional savings, SMPA also offers separate rebates for energy efficiency, energy audits, and weatherization that can be combined with these renewable energy incentives.

The Xcel Energy Solar* Rewards Program – Low Income is a special initiative designed to make solar energy accessible to income-qualified households in Colorado. Through this program, Xcel Energy provides production-based incentives for solar panel systems installed on homes of eligible low-income residents, helping to reduce electricity costs while supporting clean energy adoption.

Participants receive monthly payments from Xcel Energy based on the amount of solar energy their system produces. These payments come in the form of Renewable Energy Credits (RECs) that Xcel purchases from you at a predetermined rate. The program specifically targets households that might otherwise find solar installation financially challenging, making renewable energy more equitable and accessible across Colorado communities.

The Xcel Energy Solar* Rewards Program – Renewable Battery Connect is a utility incentive program available to Colorado homeowners who install solar panels with battery storage systems. Through this program, Xcel Energy provides financial incentives to customers who allow the utility to access their battery storage during peak demand periods, helping to stabilize the grid while providing homeowners with energy independence.

Participants receive monthly bill credits based on the capacity of their battery system and their level of participation. The program requires that you be an Xcel Energy customer in Colorado with a qualifying battery storage system installed by an approved contractor. Your system must also meet Xcel’s technical requirements for grid integration. Before enrolling, it’s important to understand that Xcel will have limited access to your battery during specific times to help manage grid demand, though you’ll maintain primary control of your energy storage for backup power during outages.

The City of Boulder Solar Tax Rebate program offers financial relief to residents and businesses who install solar electric or solar thermal (hot water) systems on their property. Established in 2008, this incentive provides approximately 15% rebate of the city sales and use tax paid on materials and permits for solar installations. This rebate helps reduce the overall cost of going solar while supporting Boulder’s commitment to renewable energy.

To qualify for this rebate, applicants must submit their application within 12 months of the city’s final inspection of their solar installation. The application process requires completing the Solar Tax Rebate Application form and an Affidavit of Legal Residency, along with submitting receipts from the project and a photocopy of identification. It’s important to note that rebates are subject to funding availability, so interested homeowners should apply promptly after their installation is complete to ensure they don’t miss out on this opportunity.

Net Metering in Colorado is a valuable incentive that allows solar homeowners to receive full credit for excess electricity their system sends back to the grid. When your solar panels produce more electricity than your home uses, the surplus energy flows back to the utility grid, and you receive a credit on your bill at a 1:1 ratio. This means for every kilowatt-hour (kWh) you export, you get credited for one kWh on your bill – essentially using the grid as a virtual battery.

The financial benefit varies slightly depending on your utility provider. Most Colorado utilities offer two options for handling year-end excess credits: rolling them over indefinitely or receiving a cash payment. Cash payment rates range from approximately 1.5¢/kWh with Xcel Energy and Black Hills Energy to 5.5¢/kWh with CORE Electric Cooperative. Palmetto typically recommends the rollover option as using credits at retail rates (around 14-16¢/kWh) is more valuable than receiving the lower cash payment rate.

All residential solar customers in Colorado are eligible for net metering, regardless of system size. There are no specific deadlines to enroll, as net metering is automatically applied when your solar system is interconnected with the grid. However, it’s important to note that most utilities conduct their annual true-up in April, when they either cash out excess credits or roll them over depending on your selected option.

Special considerations include understanding that if you choose the indefinite rollover option, you’ll never receive a cash payment, and credits will be forfeited if you move. Additionally, Grand Valley Power Cooperative customers should be aware they’re on mandatory Time-of-Use (TOU) rates, meaning solar production during one rate period cannot offset consumption during another rate period, which affects how credits are calculated and applied.