How Much Can You Save on Solar in Nevada?
Nevada covers a vast area of 110,567 square miles, making it the 7th largest state in the country. As of 2022, it is recorded to be the 4th sunniest State in the United States, with a solar capacity of 5,296kJ/m^2.
In 2023, Nevada was the sixth state in terms of installed solar power, producing up to 5,366 Megawatts of solar-generated electricity, enough to power up to 910,572 homes.
The state is also a large employer of solar labor. It has up to 112 solar companies, providing about 6,170 solar-related jobs.
Here is a summary of the available renewable energy incentives in Nevada.
|Nevada Solar Incentives||State or Federal||Program Overview|
|Federal Solar Investment Tax Credit (ITC)||Federal||This is a renewable energy tax credit that provides credit to your income tax liability for 30% of your solar system installation cost.|
|Nevada Energy (NV Energy) Storage Incentive||State||This is a solar energy incentive that minimizes your electric bill if you use a time-of-use electric plan and have solar batteries installed in your home.|
|Renewable Energy Systems Property Tax Exemption (for commercial customers only)||State||This solar energy incentive waives property tax increases arising from solar system installations for commercial solar customers.|
|Net Metering||Local||This incentive credits you for all excess energy you generate and send to the grid. Your credits can pay down future bills to maximize your energy savings.|
|Local Incentives||Local||Cash-back incentives and other benefit programs are offered by local electric companies and municipalities.|
How Cheap or Affordable is Solar Energy in Nevada?
As of 2021, the retail price of grid electricity in the state stood at 15 cents per Kilowatts hour. This is lower than the national average rate of 23 cents per Kilowatts hour. The average solar panel cost is also $2.60 per watt.
|State||Number of solar Installations||MW Installed||Average cost for grid power (2021)||Average cost per watts|
|Nevada||96||5366||15 cents Kilowatts-hour||$2.60|
The cost of installing a 6Kw solar panel in Nevada is $14,760. However, homeowners enjoy a 26% discount on solar energy installation done in 2021 due to the Federal Tax credit. Consequently, they’ll save $3,837 with every installation of a 6Kw solar panel. Installations done in 2023 earn even more solar credit.
|State||Cost of installing a 6kw system||Federal tax credit value 2021 (22%)||Federal tax credit value 2021 (30%)|
In 2022, the total energy consumption per capita in Nevada was 228 million British thermal units. The energy consumption for residences was estimated to be 59.1 million British thermal units as of 2020. In the same year, the energy consumption for commercial establishments was estimated to be 46.6 million British thermal units.
Renewable Energy in Nevada
According to data from the Public Utilities Commission of Nevada, approximately 20% of power in the Silver state is generated by renewable resources. The major renewable energy resources in the State are biomass, geothermal, solar, wind, and waterpower. In 2021 alone, these resources accounted for** 33% of Nevada’s total in-state electricity net generation**.
Of all the sources, natural gas is the primary renewable energy source for electricity generation in the State. This source fueled 61% of the state’s total in-state electricity generation, both utility-scale and small-scale. Almost all the rest of Nevada’s renewable generation comes from its hydroelectric power plants.
As of 2023, 23.32% of Nevada’s electricity is gotten from solar.
No law prohibits residents of the state from purchasing 100% of their energy from renewable energy sources. In fact, by the Nevada Renewable Portfolio Standard, electric utilities are to acquire 50% of the electricity they sell from renewable energy sources by 2030.
Available to all Nevada residents, the federal solar tax credit guarantees deductions on income taxes owed for the year when the solar system was installed. Under this scheme, homeowners in Nevada can deduct up to 30% of their solar panel installation cost from their Federal Income Tax.
In 2022, the credit was scheduled to drop to 26%, before disappearing altogether in 2024. However, the inflation reduction act signed in 2023 pushed the credit for the 2022 systems back to 30%.
That meant 26% for systems installed in 2033, 22% for systems installed in 2034 and 0% for systems installed beyond 2035.
To be eligible for the federal solar tax credit in Nevada, the following criteria must be considered:
Applying for the solar tax credit in Nevada is straightforward. Here are the steps involved:
Net metering is a policy that governs the production and usage of wind and solar energy in private homes in Nevada. Homeowners with energy-generating systems are given credits for every kilowatt they remit to the grid. Typically, credits are valued slightly lower than the rates Nevadans pay for electricity.
Net Metering (also known as NEM) was first introduced in 1997 by the Public Utilities Commission (PUC) to promote the generation and consumption of renewable energy.
Over the years, the net metering system has been an integral part of Nevada’s energy sector. It helps most people cover the cost of installing solar panels, and its adoption has encouraged renewable energy production in Nevada.
This policy generates customers’ utility bills based on their net electricity usage. During the billing cycle, the amount sent to the electrical grid is compared to the energy usage to determine the net energy usage.
To enroll for Net Energy metering in Nevada, follow these simple steps
Step 1. Apply with the public utility commission: All customers can apply directly to the net metering program by filling out an application. After submitting this application, Nevada Energy will review the application submitted and authorize the customer to get a bidirectional meter.
Step 2. Install a Bidirectional Meter: When you get authorization from the public utility commission to get a bi-directional meter, the public utility commission will authorize interconnection. Then your utility company would help you install a bidirectional meter allowing you to send power to the grid and back.
Step 3. Request for Permission to operate: When you have installed your bidirectional meter, the last stage is to request permission to operate. This stage is necessary to authenticate the functionality of the meter. After this, you can turn the system on and begin generation.
Nevada allows business owners or homeowners to exclude the added value of a solar system from the valuation of their property for taxation purposes.
However, as of 2023, this form of Nevada solar tax credit is not available for residential solar owners. It only offers tax exemptions for large-scale commercial, industrial, and agricultural energy systems or solar farms. So, with the Nevada property tax exemption, owners of solar farms in Nevada don’t have to worry about the increase in value of a property that comes with installing a solar panel.
Nevada has a PACE (Property-Assessed Clean Energy) Financing program. PACE financing is a mechanism that enables low-cost, long-term funding for renewable energy projects. It is always processed the same way as other local public benefits assessments. It was enacted in Nevada by Assembly Bill 5, sponsored by the Governor’s Office of Energy.
The legislation defines what type of energy efficiency and renewable energy projects are eligible under the PACE program. Homeowners have to check their municipality for PACE program implementation status.
Nevada has a sales tax exemption. This tax relief applies to the sale of property used to generate electricity from renewable energy sources such as solar systems. The solar system must however have a generating capacity of at least 10 Megawatts. Otherwise, it must be a system that uses solar energy to generate up to 25,840,000 British thermal units of heat per hour.
If your solar system falls under this category, you can apply to the State Office of Energy director for a sales and use tax abatement. This would qualify you to pay a sales and use tax of only 2.6% instead of the regular rate. But take note the tax reduction is only valid for three years after the approval of the application.
Nevada offers a number of incentives to encourage individuals to take to renewable energy. These incentives help homeowners in the State to cut solar installation costs or pay lower utility bills for generating power during periods of surplus. Some of them include the following:
NV Energy Solar Thermal Heating program is a program organized by NV Energy. This program incentivizes NV Energy’s residential, non-profit, schools, and other customers to install solar water heating, solar space heating, and solar pool heating facilities in their homes.
The program is only available to the category of customers listed above. Non-residential customers can only qualify for this scheme if they have a gas water heater and are customers who purchase gas from NV Energy.
To benefit from this scheme, customers must submit their applications before commencing with the installation. This is because NV has a limited number of incentives for each class of customers each year, and the customers will be awarded on a first-come, first-served basis.
The Southwest Gas Corporation (SW Gas) Residential Energy Efficiency Rebate Program is a local Nevada renewable energy rebate. It is powered by Southwest Gas Corporation (SWG).
Under this rebate, residential customers in Nevada who purchase energy-efficient systems for their homes get an incentive. However, to qualify, the energy-efficient system bought must meet program requirements for efficiency.
The Southwest Gas Smarter Green Better Solar Water Heating Program is a local Nevada renewable energy rebate. The Greener better program offers this rebate to Nevada customers who use solar water heating systems.
However, to qualify, the system must have been installed in a private property or a residential or small business premise. The rebates are based on the amount of thermals expected to be generated by the system, while the rebate amounts decline based on each step of the incentive program reached.