If you’re a business owner in the state of Iowa and considering installing solar panels on your property, there are a few things you’ll want to know before taking action.
Suitable for solar
You may be surprised to learn that although it’s a relatively northern state Iowa is surprisingly well suited for solar. On average, Iowa sees about 200 sunny days per year and the cool seasonal temperatures in both spring and fall are actually more conducive to efficient solar energy production.
Financial incentives are key
When considering solar it’s important to be aware of the financial incentives available for qualifying solar systems. Here are some of the main incentives available:
Accelerated depreciation schedule
If a business claims a solar ITC tax credit, they can also use an accelerated depreciation schedule. This helps for greater depreciation of expenses in the initial years of the system and reduces the overall cost of the installation. The difference between the ITC and the Accelerated Depreciation is, “the ITC is a tax credit—a dollar-for-dollar reduction in taxes owed—depreciation is a deduction, meaning it only reduces a business’s taxes by the depreciation amount multiplied by the business’s tax rate.” This process helps give taxpayers greater immediate reduction in their federal tax liability.
Business energy investment tax credit
The federal government passed the Inflation Reduction Act in the fall of 2022, which extended and lowered the business investment tax credit (ITC) through 2032 before seeing its first step down. The ITC allows businesses to deduct up to 30 percent of the cost of their solar panel systems from their federal taxes for systems that start their installation process before the end of 2032. However, that number will decrease to 26 percent in 2033.
Net metering
Iowa operates on a net metering policy, which allows businesses to receive credit for excess energy generated by their solar panels that is sent back to the grid. This can help offset the cost of energy usage during times when the solar panels are not generating enough power to meet the business’s needs.
Find a reputable installer
Another consideration for businesses in Iowa thinking about installing solar is selecting an experienced installer. It’s important to do your research and choose a company with experience installing solar systems on commercial properties in Iowa, is licensed and insured, and has positive reviews.
Good for the environment and your bottom Line
Overall, installing solar panels on your business in the state of Iowa can be a smart financial and environmental decision. However, it’s important to do your research and work with experienced professionals to ensure that the installation is done correctly and meets your business’s needs.
Contact All Energy Solar today to schedule a consultation and learn how we can help you make the switch to clean, renewable energy. Or to learn more about solar for business, download our ebook Solar for Business.
