Pueblo, CO

Colorado offers a Property Tax Exemption for residential solar electric generation systems, providing significant financial relief for homeowners who install solar panels. This incentive completely exempts qualifying residential solar systems from property taxation in Colorado, meaning you won’t pay additional property taxes on the value your solar installation adds to your home.

To qualify for this exemption, your solar system must: be located on residential property, be owned by the residential property owner, produce electricity primarily for use in your home, and have a production capacity of no more than 100 kilowatts of AC electricity. The exemption applies automatically to eligible systems with no application required, and there is no expiration date for this incentive, making it a permanent benefit for Colorado homeowners who install qualifying solar systems.

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, potentially saving homeowners hundreds of dollars on their solar installation costs.

Eligible components include solar modules, supporting structures, inverters, wiring, control systems, and other essential solar equipment. However, the exemption doesn’t cover labor costs, energy storage devices, or remote monitoring systems. It’s important to note that while this exemption applies at the state level, most city and county sales taxes still apply unless the local government has specifically adopted the exemption. There is no expiration date for this incentive, making it a permanent benefit for Colorado homeowners going solar.

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. Battery storage installations are also eligible for an additional $150 per kWh of capacity, up to $3,000. The combined maximum incentive available is $4,000 per system.

To qualify, homeowners must be Fort Collins Utilities electric customers and use a contractor from the Participating Solar Contractor Network. Systems must be at least 500 watts, meet interconnection standards, and use new, UL-listed equipment. In exchange for the rebate, customers agree to sell the Renewable Energy Credits (RECs) from their system to the utility for 20 years. Applications must be submitted through the PowerClerk platform, and systems must be installed within six months of receiving the rebate reservation letter.

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 3kW or $300. Commercial customers are eligible for the same rate of $0.10 per watt but with a higher cap of up to 10kW or $1,000. The program also includes similar rebates for small wind systems.

To apply for these rebates, your contractor must complete and submit the necessary paperwork on your behalf. While contractors don’t need to be pre-registered with SMPA, they must meet certain eligibility requirements. The application process is administered directly by SMPA, and important deadlines apply to the submission of rebate applications. For more information or assistance with the application process, you can contact SMPA Member Services at (970) 626-5549 or email [email protected].

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 purchases the Renewable Energy Credits (RECs) generated by your solar system, providing you with a steady income stream that helps offset the cost of going solar.

Participants receive production-based incentive payments for the energy their solar systems generate. These payments are made monthly over a 10-year period, making solar more affordable for families with limited financial resources. The program specifically targets households that might otherwise be unable to benefit from clean energy savings.

To qualify, you must be an Xcel Energy customer in Colorado and meet income eligibility requirements. The program is designed for households with income at or below certain thresholds relative to the Area Median Income. You’ll need to provide documentation verifying your income status during the application process.

If you’re considering this program, it’s important to note that funding is limited and applications are typically processed on a first-come, first-served basis. The incentive rates and available capacity may change annually, so checking Xcel Energy’s website for the most current information is recommended before making any decisions about your solar installation.

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 offers 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 backup security.

Participants receive production-based incentives for the energy their solar system generates, plus additional compensation for allowing Xcel to utilize their battery storage capacity when needed. The program typically offers a set payment per kilowatt-hour (kWh) produced over a 10-year period, though specific payment rates may vary based on system size and current program terms. To qualify, you must be an Xcel Energy customer in Colorado with an eligible solar+storage system that meets the utility’s technical requirements.

Before enrolling, homeowners should understand that Xcel will have limited access to their battery system during specific times, though the program is designed to ensure you maintain backup power for emergencies. The application process requires working with an approved solar installer who can help determine if your system qualifies and assist with the necessary paperwork. For the most current incentive rates and program details, it’s recommended to contact Xcel Energy directly or visit their website.

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 can help offset the initial cost of going solar while supporting Boulder’s commitment to renewable energy.

To qualify, applicants must submit their rebate 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 providing 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 valuable incentive.

Net Metering in Colorado is a valuable program 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, this surplus energy flows to the utility grid, and you receive a credit on your bill at a 1:1 rate—meaning each kilowatt-hour (kWh) you export is worth the same as one you would purchase from the utility.

These credits can be applied to future electricity bills when your solar system isn’t producing enough to cover your needs, such as during nighttime or cloudy days. This effectively allows you to use the grid as a virtual battery, storing the value of your excess production for later use.

The program varies slightly between Colorado utilities. Most allow credits to roll over month-to-month, but annual true-up policies differ. For example, Xcel Energy and Black Hills Energy customers can choose between indefinite rollover of credits or annual cash-out at wholesale rates (approximately 1.5¢/kWh). Other utilities like CORE Electric Cooperative cash out annually at higher rates (5.5¢/kWh through April 2024).

Colorado homeowners should carefully consider their options at true-up time. Generally, keeping credits for future use is more valuable than cashing out at wholesale rates. Also note that with the rollover option, any accumulated credits may be forfeited if you move. There are no specific system size limitations mentioned in the program details, making net metering accessible to most residential solar customers in Colorado.