Tap into the power of the sun and save money on your monthly bills by switching to solar energy. Installing solar panels can save you money by reducing your energy costs. But they can make even better financial sense if you take advantage of tax incentives, rebates and special financing programs.

If you're a homeowner in the state of Ohio, there are a handful of ways you can shave some dollars off the tens of thousands of dollars that solar panels -- and potentially batteries -- can cost.

"The value proposition has gotten to be very good since energy costs overall have gone up across the country," said Tristan Rader, Ohio director for Solar United Neighbors. "The more you're paying for energy off of the grid, the better a value proposition is solar on your roof. You're avoiding a lot of those costs by having a solar array."

In this guide, we'll walk you through solar panel incentives, solar tax credits, solar panel rebates and loans in the Buckeye State.

 *Estimated value calculated by using a national average of $24,000 for installing solar panels, or 8 kW at a national average cost of $3 per watt

Federal solar tax credit

Expanded and extended in the Inflation Reduction Act passed in 2022, the residential clean energy credit is the most significant tax incentive for US homeowners wanting to go solar. It provides you with a tax credit worth up to 30% of the total cost of installing solar panels on your home.

Ohio solar tax credits, exemptions and loan programs

The Buckeye State has some programs that can help soften the financial cost of going solar. Here are some we found:

Ohio Property-Assessed Clean Energy (PACE) Financing

The PACE financing program offers an affordable way to install a solar panel system at your home. This financing tool allows you to repay the costs of an energy improvement through a voluntary assessment on your property taxes. PACE financing features zero down payment, a fixed interest rate, no personal guarantee and 15- to 25-year financing terms. 

Solar Renewable Energy Credits (SRECs) 

Under this program, you can receive credit for the electricity your solar panels generate. For every megawatt-hour (MWh), you receive a credit that you can cash in. SRECs can be sold through third parties. The cost per SREC in Ohio varies. 

Local solar panel incentives in Ohio

Your city, county or community may have its own programs to encourage solar panels. Here are some examples.

City of Cincinnati Residential Tax Abatement

Residents of Cincinnati can lower their taxes to the pre-improvement value of their property for anywhere from 10 to 15 years. This applies to existing home renovation properties.  Some sweet news: this incentive went through a substantial revamp in 2023 to prioritize eco-friendly projects. 

Cuyahoga County Home Enhancement Loan Program (HELP)

Homeowners in most of Cuyahoga County can receive a loan of up to $200,000 at a 3 percentage points below market rate to make improvements on eligible homes. 

Franklin County Home Improvement Program 

In Franklin County, residential property owners might be eligible for a property tax exemption on their home solar project. The terms, such as the number of years the abatement stretches for and the percentage abated, vary. 

Hamilton County Home Improvement Program (HIP) 

Hamilton County residents may be eligible for five-year loans at 3 percentage points below market rate for home improvements. These loans are capped at $50,000, but there are no income restrictions or limits. You just need to meet the partner bank's lending criteria. 

Ohio net metering rules for solar energy

Net metering is available if you live in Ohio. Homeowners who produce their own solar energy on their property can scoop up a credit on their electricity bills for excess energy that goes back into the electric utility's distribution system -- the grid.

In Ohio, if your home has a solar energy system and is connected to your local electric utility's distribution system, you're eligible to save on your electricity bill. The solar energy system on your home can be used to offset part or all of your energy needs, up to 120%.

Net metering credits can be put toward your bill in future months and can continue to carry forward.

Your breakeven point for installing solar in your home is earlier if you stack net metering on top of money saved on your home energy bills. In Ohio, payback periods for solar installations are generally less than 10 years because of net metering, Rader said.

"You're getting credits in the summertime, and you're using those credits in the fall and even wintertime," he said. "So you're not seeing a bill for a good chunk of the year if you have a solar system that's large enough. Then the net metering system allows you to actually spread that out over the year, which is fantastic."

Community solar projects in Ohio

Currently, Ohio doesn't have any community solar projects for its residents. Lawmakers in 2023 introduced a bill that would create a pilot program for community solar.

"We're hoping that soon in Ohio, we will have community solar and that people would be able to subscribe to these community solar projects all around the state once we have that rule," Rader said. "But right now, we don't have the regulatory system set up to allow for community solar projects to exist."