Rebates & Incentives going solar in Kentucky

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 The Inflation Reduction Act (IRA) of 2022 establishes and extends the federal Investment Tax Credit (ITC) for solar photovoltaic (PV) systems at a rate of 30% of the total PV system cost. The 30% ITC was extended for 10 years, through 2032. Unlike tax deductions, this tax credit can be used to directly offset your tax liability dollar for dollar. The IRA extended the carryback period to 3 years, and the carryforward period to 22 years, in cases where the tax credit exceeds a customer’s tax liability in the ‘placed-in-service’ year. For PV projects greater than 1 MW AC in size, the IRA established prevailing wage and apprenticeship requirements in order to qualify for the full 30% “increased rate”, rather than a “base rate” which would only qualify for a 6% ITC. Projects with an output of less than 1 megawatt qualify for the “increased rate” irrespective of if prevailing wage or apprenticeship requirements are met. In addition to the 30% ITC, the IRA establishes three different types of ITC “Adders”, which provide additional tax credits of up to 10% each, for projects that meet specified requirements. (1) Energy Community, projects sited in an “energy community”, which includes brownfield sites, census tracts where a coal mine closed after 1999 or a coal-fired power plant was retired after 2009, or areas where 25% of local tax revenues are related to the extraction, processing or storage of coal, oil, or natural gas at any time beginning in 2010. (2) Low-income, projects located in a qualified “low-income community”, which is defined as a census tract with a poverty rate of at least 20%, as well as a census tract where the median family income (MFI) is 80% or less of statewide MFI, or on “Indian land”, which is defined as land located within the boundaries of an Indian reservation or lands held by a tribe. (3) Domestic Content, for projects that meet specified domestic content requirements which will be set by Treasury, including 100% steel/iron for manufactured products with a 40% requirement through 2024 followed by 45% in 2025, 50% in 2026, and 55% in 2027 and beyond. Manufactured content is further explained: the products which are components of a qualified facility upon completion will be deemed to have been produced in the United States if the adjusted percentage of the total costs of all such manufactured products of the facility are attributable to manufactured products which are mined, produced, or manufactured in the United States.