As of December 2020, the average cost of a solar panel installation in Louisiana is around $2.47 - $3.35 per watt. The total cost of a 5kW solar system will not exceed $17,077 after claiming the 26% federal solar tax credit.
The amount of solar energy you get depends on the power output of your system, the amount of sunlight that hits the panel and factors such as solar panel placement and shading. Louisiana ranks in the top 20 for peak sun hours received per year out of all states in the country. Power output is a physical solar panel attribute measured in watts (W) and it tells how much energy the panel can produce under ideal temperature (77°F) and sunlight conditions. Most home solar panels’ power output is 250 to 400 watts per 4 hours. As for placement, a solar system that is installed on a south-facing 30-degree pitch roof in Louisiana will generate 1,550kWh per year.
Federal solar investment tax credit (ITC) – a governmental perk that allows all solar panel buyers to get a 26% deduction of the installing cost from federal taxes. For example, if your solar system costs $15,000, your tax credit would be $3,900. Deduction will be lowered by 5.0% in 2021 and will be gone the year after unless new legislation is introduced.
Louisiana 50% Tax Credit – this credit offers 50% of the solar system’s initial cost. It can be deducted from your state taxes, or you can get a check if the credit amount is less than what you pay in taxes.
Property tax exemption – in the state of Louisiana all solar panel buyers are 100% exempted from property tax. Even though your solar panels add value to your property and should therefore be additionally taxed, they are exempted from property taxes.
Solar energy is a fantastic investment, and plenty of direct sunlight in Louisiana will help you save a significant amount of money. Moreover, in 2020 solar panels remain subsidized by the 26% federal tax credit making them a lucrative deal.
When you install a solar system, 26% of your project expenses apply toward a credit to offset any taxes you owe that year. This federal tax credit is a major incentive to go solar, but it is going to be phased out by 2024.
To be eligible to claim this credit, you must owe federal taxes.