Louisiana is making strides toward a greener future with a range of solar incentives and programs to encourage residents to adopt clean energy. Our guide breaks down the most popular programs designed to help you offset the cost of solar panel installation. We’ll walk you through Louisiana’s loan program, state tax exemption, the best solar companies, and more so you can confidently invest in renewable energy.
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What Are the Available Solar Tax Credits and Rebates in Louisiana?
Louisiana’s solar incentives include loan programs, property tax exemptions, and net metering. We explain each opportunity for you below.
Home Energy Loan Program (HELP)
A homeowner can obtain a five-year loan through Louisiana’s Department of Natural Resources’ HELP program to improve their home’s energy efficiency. Qualified homeowners may receive an energy efficiency improvement loan of up to $12,000. Residents must go through the normal underwriting process so that their loan meets the state’s “Prescriptive List of Improvements.” This list always includes solar water heaters, but you may also be approved for solar panel installation after undergoing the underwriting process.
More resources:
Tax Exemption for Solar Energy Systems
The Louisiana Department of Natural Resources provides an ad valorem tax exemption for solar electric and solar water heating systems installed on a residential property. An ad valorem tax is based on an item’s assessed value, which the state then applies to your property taxes. This means your property taxes won’t increase due to the value a solar panel installation adds to your home. This incentive results in additional long-term savings and a quicker return on investment (ROI) since you avoid paying more taxes.
More resources: Database of State Incentives for Renewables and Efficiency (DSIRE) page
How Much Can You Save With the Federal Solar Tax Credit?
Louisiana homeowners who own their solar systems, either through direct purchase or financing, can save significantly with the federal solar investment tax credit (ITC). The federal ITC, a 30% tax credit on the cost of your system, applies to new solar installations purchased through 2032.
If the total amount of your credit exceeds what you owe in taxes, you can carry over the unused credit into the following tax year. Consult a tax professional to understand your potential tax benefits fully.
You won’t qualify for tax credits if you lease a solar system or sign a power purchase agreement (PPA) since these options don’t make you the system’s owner. Learn more about solar ownership versus leasing to make the best decision for your situation.
Is Net Metering Available in Louisiana?
Net metering is a billing arrangement that assists homeowners in lowering or removing their monthly utility costs. This financial agreement credits solar energy system owners for any excess energy sent to the power grid. Homeowners can use those credits to offset power consumption from their utility company at night or on cloudy days.
Entergy Louisiana offers one of the state’s most established net metering programs. Program stipulations will vary between utility companies, so we recommend you check with your provider about its specific program.
How Much Do Solar Panels Cost in Louisiana?
The cost of installing solar panels in Louisiana is around $12,238 for a 5-kilowatt system, according to EnergySage, but it will ultimately be determined by factors such as your system’s size and energy needs. Applying the federal solar tax credit reduces a typical system’s costs by $3,671.
Each solar payment option comes with different pros and cons. For example, cash purchases maximize savings by allowing homeowners to take full advantage of incentives, while financing options provide flexibility for those who prefer to spread out payments.
- Cash purchase: This option provides the highest return on investment (ROI) by eliminating interest costs and allowing homeowners to claim all available incentives.
- Solar loan: This offers ownership while spreading payments over time, with lower interest rates than credit cards or home equity loans.
- Solar lease: This option involves leasing panels from a provider with little to no upfront cost, but you won’t own the system or qualify for incentives.
- Power purchase agreement (PPA): A PPA lets you pay a fixed rate for the electricity generated by the panels rather than owning them, meaning incentives do not apply.
Is Going Solar in Louisiana Worth It?
Going solar is worth it for Louisianans with enough up-front capital and a home that receives ample sunlight. Louisiana generally gets abundant sunlight, making it well-suited for solar power generation. It also has relatively high average electricity prices compared to other states, which currently sit at 9–12 cents per kilowatt-hour (kWh). Solar can shield your electricity bills against the state’s rising utility retail rates.
The Process of Going Solar in Louisiana
Embarking on a solar journey in Louisiana can seem daunting, so let’s break it down step by step. Here’s what to expect:
- Consultation: Start by reaching out to several local solar companies. They’ll assess your home’s solar potential by evaluating its sunlight exposure and energy needs. This typically involves online tools followed by an in-person survey and determines how many solar panels you need. This step usually takes a few days.
- Design: With the survey complete, the installer customizes a solar system tailored to your roof, energy usage, and budget. You’ll receive design options and hardware recommendations, which include your inverters and battery storage (if applicable). Plan for about 1–2 weeks to finalize your choices.
- Permitting and approvals: The company handles all necessary permits once you approve the design. This includes complying with local zoning rules and any homeowners’ association (HOA) guidelines. The approval process can take 1–2 months, depending on local regulations and your utility provider.
- Installation: When your permits are approved, the installation process kicks off. Most companies complete this in a day, typically within 1–3 months of your initial consultation.
- Final inspection: After installation, your system goes through a final inspection. Your installer ensures it’s working properly, teaches you how to monitor performance and perform routine maintenance, and explains changes to your energy bill. They’ll also highlight how net metering can reduce your electric costs.
Our Conclusion
Going solar in Louisiana is more expensive than in other states, but the state still offers incentives to help alleviate solar costs. We’ve covered the most significant incentive programs, but smaller city- or municipality-specific incentives may be worth exploring. We recommend checking DSIRE for more information.
You should read our guide on the best solar companies in Louisiana to find a local installer that matches your needs and can help you obtain incentives.
FAQs About Solar Tax Incentives in Louisiana
Does Louisiana have a solar tax credit?
Louisiana doesn’t have a state-level solar tax credit, but you can use the federal solar tax credit to get 30% back on your installation cost the following tax season.
Is living off the grid illegal in Louisiana?
No, it isn’t illegal to live off-grid in Louisiana. However, you must check with various housing authorities, as an off-grid residence must adhere to certain building codes and safety regulations set by the state.
How many years can you carry over the federal solar tax credit?
You can roll the federal solar tax credit back one year and carry the credit forward for up to five years.
Our Rating Methodology
We are committed to providing comprehensive and unbiased reviews to our readers. After over a thousand hours of research on solar companies, interviews with experts, and common customer needs, we’ve created a detailed rating system for solar providers based on six factors:
- Solar equipment, installation, and services (25%)
- Warranty and performance guarantees (25%)
- Brand reputation and certifications (15%)
- Financing options (15%)
- Experience (10%)
- Availability (10%)
Total scores are divided by 20 for a final 5-point rating scale.
