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Indiana Solar Rebates and Incentives

Indiana Rebates and Incentives Summary

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Although California is going to be the leader in green energy for years to come, Indiana is making strides to develop its renewable energy infrastructure by offering a slew of incentives to residents, schools, and businesses that make green living more affordable and easier for even the average “Joe 6-pack” to afford.

The biggest player in the green energy race in the state of Indiana is the Indiana Utility Regulatory Commission (IURC) who has been putting into place rules and regulations that are making some serious changes to embrace the green economy.

One of the major changes handed down by the IURC is that the state’s investor-owned utilities (IOU) are required to offer a net-metering program to any property owners that have renewable energy systems. Net metering essentially pays you for the excess energy that you produce by the IOUs buying the kilowatt hours back from you. In the case of solar systems in Indiana, the IOUs are required to buy the energy back from you at the same rate they charge per kilowatt hour. Even though the state’s big three IOUs have voluntarily offered net metering up until the 2004 decision, the regulation of mandatory metering is a huge step in the direction of increased renewable interest.

Another huge incentive offered to renewable savvy residents is the property tax exemption program that was created by the state legislature to encourage residents to invest in the valuable green technology. Under the renewable energy property tax exemption, program home owners and renters are eligible to receive 100 percent property tax exemption for installing renewable energy systems in their home, and have the costs of materials and labor of the upgrade covered by a tax rebate on the next available refund year.

Unfortunately, Indiana currently has no Renewable Energy Standard (RES), and because of that is taking a major hit in the renewable market as compared to neighboring states. Illinois, for example, has adopted a policy that aims at generating 25 percent of the state’s power by renewable means by 2015. Michigan has an RES aimed at 10 percent of their energy coming from renewable sources by 2015, and as a result has seen more than $9 billion in renewable energy investment and is predicting an increase in 9,000 jobs over the next ten years. Because of its lack of a RES, Indiana is falling short in alternative energy investors, manufacturers, and subsequently is losing out on the jobs that would come with them.

All is not lost, however, and groups like Indiana’s Coalition for Renewable Energy and Economic Development (ICREED) have been lobbying to adopt a RES for the state. 

Renewable Energy Property Tax Exemption

Program Type Property Tax Incentive
Technologies

Solar Water Heat, Solar Space Heat, Solar Thermal Process Heat, Wind, Hydroelectric,

Geothermal Electric, Geothermal Heat Pumps, Solar Pool Heating, Geothermal Direct-Use
Amount 100 percent
Required Documentation Form 18865 filed with local county auditor
Official Web Site http://www.in.gov/dlgf/2440.htm

The Indiana state government has made great strides in offering excellent incentives for property owners to cash in on green technologies within certain guidelines. For residents to become 100 percent exempt from property taxes by way of installing renewable energy systems to their home or mobile home, they must generate what the county auditor and/or assessor deem adequate to cash in on the exemption.

There is no specific requirement as to how much energy in kilowatt hours must be produced or stored, but the county auditor and/or assessor will determine if the system is up to code and of adequate efficiency.

Proof of out-of-pocket costs for materials and installation of the system will also be covered by way of tax deductions.

To claim these costs, all the property owner needs to do is provide invoices or other means of documentation for the out of pocket expenses involved in the cost of materials and installation.

Energy Savings Tax Credit

Program Type Tax Incentive
Technologies Solar Powered Roof Vent or Fans
Amount

One-half of the amount paid for labor and materials for the installation of a solar powered roof

vent or fan, or $1000
Required Documentation The installation date(s), proof of your costs for the installation of a solar powered roof
vent or fan, and a list of the persons or corporation that supplied labor or
materials for the installation of the solar powered roof vent or fan
Official Web Site http://www.in.gov/dor/reference/files/it40-annotated.pdf

The state of Indiana offers its residents a significant tax deduction on full-year residential income taxes for the installation of energy saving solar powered roof vents and fans. This incentive is offered through federal tax breaks that encourage residents to jump on the green bandwagon, and upgrade old roof venting and fan systems for virtually the same price as ones that are inefficient and not powered by renewable solar energy sources.

Roof vents and fans are basically there to do exactly what their name would imply, vent or fan large empty spaces in attics that in the summer need to breathe to reduce cooling and air conditioning costs, and in the winter need to be contained to keep heat inside of the building helping cut back on expensive heating costs. Since there are solar alternatives to these critical components of a home, the federal government offers this program to write off half the cost of installing these vent/fanning systems and further reduce the consumption of precious non-renewable energy.

To be eligible for this tax deduction, you must be the owner or leaser of the building you are going to install the solar powered vent or fan, you must provide documentation of the installation date(s), and provide documentation of the cost of materials, labor, person’s or corporation responsible for purchasing the materials and performing installation, and enter 6 2 3 on Schedule 2 under line 11 of the IT-40 if claiming this deduction.

Indiana Net Metering

Program Type Net Metering
Technologies Photovoltaics, Wind, Small Hydroelectric
Amount Net excess generation credited to customer’s at retail rate; carries over indefinitely
Required Documentation Net-metered systems must comply with Indiana's interconnection standards
Official Web Site http://www.in.gov/iurc/2340.htm

The Indiana Utility Regulatory Commission (IURC) put into motion rules and regulations regarding net metering in September 2004 to mandate that the state's investor-owned utilities (IOUs) offer a metering program to all residential customers and K-12 schools. Solar, wind, and small hydroelectric systems producing up to 10kW all fall under eligibility for the net-metering program under the following provisions:

A utility may limit the aggregate amount of net-metering (nameplate) capacity to 0.1% of its most recent summer peak load.

An interconnection agreement between the utility and the customer must be executed before the facility may be interconnected.

Net-metered systems must comply with Indiana's interconnection standards (170 IAC 4-4.3).

Either a single meter or a dual-meter arrangement may be used.

Utilities may not charge customers any fees for additional metering for single-phase configurations installed by the utility, for customers' requests to net meter, or for an initial net-metering facility inspection.

Net metering customers must maintain homeowners, commercial, or other insurance providing coverage of at least $100,000 against loss arising out of the use of a net metered facility. Utilities may not require additional liability insurance in excess of this limit.

Net excess generation (NEG) is credited to the customer's next monthly bill. The rules do not address the expiration of NEG for continuous customers. (If a customer elects to cease net metering, any unused credit will revert to the utility.)

Before the mandatory rules were put into place in 2004 by the IURC, Indianapolis Power & Light Company (IPL), Southern Indiana Gas and Electric Company (SIGECO), and PSI Energy voluntarily offered a net metering program to customers with green energy systems. Currently, since spring of 2010, IPL offers a net metering program for all customer classes, and a much greater maximum capacity of 50kW which is IURC approved.

Indiana Solar Power Financial Incentives

Financial Incentives

Corporate Tax Credit

Personal Tax Credit

Property Tax Exemption

State Grant Program

Utility Grant Program

Utility Loan Program

Utility Rebate Program



Rules, Regulations & Policies

Building Energy Code

Energy Standards for Public Buildings

Green Power Purchasing/Aggregation

Interconnection

Net Metering

Solar Access Law/Guideline




Related Programs & Initiatives

Alternative Fuels and Advanced Vehicles Data Center
 

The U.S. Department of Energy's Alternative Fuels and Advanced Vehicles Data Center (AFDC) provides a wide range of information and resources to enable the use of alternative fuels and other petroleum-reduction options, such as advanced vehicles, fuel blends, idle reduction and fuel economy. The AFDC site offers a database of state and federal laws and incentives related to alternative fuels and vehicles, air quality, fuel efficiency, and other transportation-related topics.



Green Power Network
 

The U.S. Department of Energy's Green Power Network provides news and information on green power markets and activities, including opportunities to buy green power. This site provides state-by-state information on green power marketing and utility green power programs. In addition, the site lists marketers of renewable energy credits (RECs), also known as green tags or renewable energy certificates, which represent the environmental attributes of the power produced from renewable energy projects.



Weatherization Assistance Program
 

The U.S. Department of Energy's Weatherization Assistance Program (WAP) enables low-income families to reduce their energy bills by making their homes more energy-efficient. Through this program, weatherization service providers install energy-efficiency measures in the homes of qualifying homeowners free of charge. The WAP program web site offers a state-by-state map of opportunities, projects and activities.



Wind Powering America
 

The U.S. Department of Energy's Wind Powering America site provides state-by-state information on wind projects and activities, including wind working groups, validated wind maps, anemometer loan programs, small wind guides, state-specific news, wind for schools, workshops and web casts.