Alaska solar incentives, tax credits & rebates

Financial resources for going solar in 2023

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home in Alaska with solar panels installed on the roof

Alaska doesn’t have many solar incentives. Still, the federal solar tax credit, statewide net metering mandate and local property tax exemptions make installing solar panels more affordable in the Last Frontier.

After the federal solar investment tax credit (ITC), the average system is $10,122 in Alaska, which is cheaper than in many other states. The national average is $16,715.

Key insights

  • You can take advantage of the solar tax breaks, grants and rebates in Alaska.
  • The average federal tax credit value is $$4,338 in Alaska.
  • Alaska residents who go solar receive an estimated average net savings of $34,500 over 25 years.

Solar incentives in Alaska

The federal solar investment tax credit (ITC) is the biggest factor reducing the cost of going solar in Alaska. If you install a residential solar panel system by the end of 2032, you will receive a federal income tax credit equal to 30% of the system's total cost, which includes equipment, labor and permits.

The federal solar investment tax credit drops to 26% in 2033 and 22% in 2034.

For example, in Alaska, the average cost of a system is $14,460. With the ITC, you can get a $$4,338 credit on a system with this cost when you file your taxes. The solar tax credit is not a rebate or refund, though. You have to claim it when you file federal taxes with Form 5695.

» MUST-KNOW: The tax benefits of owning a home

Residential solar incentives in Alaska

In some areas, homeowners can get a property tax exemption when they go solar. Golden Valley Electric Association also has the Sustainable Natural Alternative Power (SNAP) program, which is a performance-based incentive for going solar.

  • Property tax exemption: This amount is set by the local government, so how much of an exemption you get may vary depending on where you live in Alaska.
  • SNAP program: Amounts are determined by the kilowatt-hour (kWh) produced and contributions from supporting members. The maximum incentive amount is $1.50 per kWh. Systems of 25 kilowatts (kW) or less are eligible.

More solar incentives in Alaska

Incentive typeIncentive amountApplicable sectorsAdministratorAvailable statewide
Power Project Loan Fund Loan program Varies Local government, municipal utilities, cooperative utilities Alaska Industrial Development and Export Authority
Renewable Energy Grant Program Grant program Varies Investor-owned utility, local government, municipal utilities, cooperative utilities, schools, state government, tribal government, retail supplier Alaska Energy Authority

What to know about net metering in Alaska

Net metering is when you produce more electricity with your solar system than you can use (and you don’t store it in a solar battery), so you send it to the power grid for compensation. In Alaska, large utilities are required to purchase up to 1.5% of the utility’s average load from customers with solar. Customers must have systems with a capacity of 25 kW or less to qualify.

Some utilities have compensation programs that are basically net metering. For example, Golden Valley Electric Association's (GVEA) SNAP program pays customers for solar. Customers signed up with this program get monthly credits on their bills and yearly payouts.

The utility pays up to $1.50 per kilowatt-hour (kWh). To qualify, your system must be 25 kW or less.

» GREENEST STATES: Alaska ranks No. 30

Solar resources in Alaska

Below are some additional resources that can guide you through transitioning to solar in Alaska.

» GUIDE: Solar panel installation

Find solar companies in Alaska

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    Can I get solar panels for free in Alaska?

    There are no programs for free solar panels in Alaska. You can lease or enter a PPA with little to no upfront costs, though.

    » FREE SOLAR PANELS: Are they really free?

    How much can I save with solar panels in Alaska?

    In Alaska, the average savings is $34,500 over 25 years. Even if you don’t generate 100% of your energy needs, you can still save a lot of money versus paying traditional utility bills.

    Are there any commercial solar incentives in Alaska?

    There is a commercial loan and grant program for solar in Alaska. You can also get paid for sending power to the grid through a performance-based incentive.

    » MORE: Commercial solar panels

    Is my HOA allowed to restrict solar panels?

    It’s possible your homeowners association may place restrictions on installing solar panels. There are no laws in Alaska that prevent HOAs from regulating solar installation.

    How can I pay for solar panels?

    Paying upfront saves you the most money because you don’t need to pay interest, but there are options to help you pay for solar if you can’t buy your system upfront. Solar loans are available to finance solar panels, and other options include leasing solar equipment or getting a PPA (power purchase agreement).

    » SOLAR PANELS: Lease vs. buy

    Bottom line: How much are solar panels in Alaska?

    Once you take the federal tax credit into account, the average solar setup in Alaska costs you $10,122. That's a steal compared with the national average of $16,715. Alaska keeps it simple with just property tax incentives and net metering. Still, over 25 years, you could save $34,500 by going solar, which is a whole lot more than you'd save in most states.

    Article sources
    ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
    1. Alaska Energy Authority, “Solar Energy Basics.” Accessed Oct. 22, 2023.
    2. Alaska Energy Authority, “Power Project Fund.” Accessed Oct. 22, 2023.
    3. Alaska Energy Authority, “Solar Projects.” Accessed Oct. 22, 2023.
    4. DSIRE, “Alaska Programs.” Accessed Oct. 22, 2023.
    5. DSIRE, “Golden Valley Electric Association - Sustainable Natural Alternative Power (SNAP) Program.” Accessed Oct. 22, 2023.
    6. DSIRE, “Local Option - Property Tax Exemption for Renewable Energy Systems.” Accessed Oct. 22, 2023.
    7. EcoWatch, “ How Much Do Solar Panels Cost in Alaska?” Accessed Oct. 22, 2023.
    8. Solar Energy Industries Association, “Alaska Solar.” Accessed Oct. 22, 2023.
    9. United States Environmental Protection Agency, “Summary of Inflation Reduction Act provisions related to renewable energy.” Accessed Oct. 22, 2023.
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