Colorado solar incentives are mostly not cash. State law makes your utility give you a full bill credit for the extra solar power you send to the grid. The cash goes to home batteries and to lower-income Xcel Energy homes, not to panels on a typical roof. What leftover credits are worth at year end depends on your utility.
Recently changed: on September 22, 2026 the Colorado Springs City Council approved new rates for solar homes, starting April 1, 2027. Holy Cross Energy moved to a flat $100 per kW solar rebate on April 1, 2026.
Colorado solar incentives at a glance: who pays, and who qualifies
| Program | What you get | Who can get it | Status |
|---|---|---|---|
| Net metering bill credits | One kWh of credit for each extra kWh | Customers of Xcel, Black Hills, co-ops and larger city utilities | State law, no end date |
| State battery tax credit | 10% of the battery price | Anyone who buys a battery for a Colorado home | Through tax year 2029 |
| Xcel battery payment | $250 per kW to $1,000 per kW of battery power | Xcel customers with a Tesla or Enphase battery | Approved for 2026 and 2027 |
| Xcel lower-income solar rebate | $3 per watt, up to 10 kW | Income-qualified Xcel homes | While the 2026 budget lasts |
| Holy Cross rebates | $100 per kW for solar, up to $12,500 for a battery | Holy Cross Energy members | While funds last |
| Two tax exemptions | No 2.9% state sales tax on solar equipment or a home battery. No property tax on solar equipment | Every home | In force |
No program pays for panels on a typical Xcel, Black Hills, Colorado Springs, CORE or United Power home. The federal tax credit is not available for systems switched on after December 31, 2025.
Xcel, Black Hills, Colorado Springs, Holy Cross or a co-op: find your utility
The name is at the top of your electric bill.
Xcel EnergyDenver, Boulder and many other communities. Colorado’s largest electric utility.Full bill credits. Cash for batteries and lower incomes.
What you can get with Xcel Energy
- Bill creditsOne for one
Net metering: Xcel credits the solar power you send out against the power you take.
- Battery payment (Renewable Battery Connect)$250 per kW
Once, upfront, per kW of battery power. Example: 5 kW gets $1,250. Income-qualified homes get $1,000 per kW. Xcel may then use up to 80% of the battery, up to 60 times a year, for five years. Tesla Powerwall and Enphase only.
- Lower-income solar rebate (Solar*Rewards)$3 per watt
Income-qualified homes only. Example: 5 kW gets $15,000. Rules and budget. Other homes get no solar rebate.
Your bill credits
Xcel asks for one choice on its Solar Bank Election Form. Rollover: extra credits stay on your account as dollars. This is permanent: no cash-out, and you lose them if you move. No form sent: Xcel pays out leftover kWh each year end at its average hourly cost of power, last printed as 1.529 cents per kWh (2023). Example: 1,000 kWh pay $15.29.
Watch out: To switch to rollover for this year, send the form by December 1. Ask Xcel if battery capacity is still open. Its battery page did not load when we checked.
Also: battery tax credit, tax exemptions.
Black Hills EnergyPueblo and other parts of southern Colorado.Full bill credits, under the same state law as Xcel.
What you can get with Black Hills Energy
- Bill creditsOne for one
Net metering: Black Hills credits the solar power you send out against the power you take.
- Solar or battery rebateAsk Black Hills
Ask whether it pays a solar or battery rebate, and get the answer in writing.
Your bill credits
State law (C.R.S. 40-2-124) gives you two paths: credits that roll forward month after month, or a payment each year end at the utility’s average hourly cost of power, if you choose it in writing. Black Hills’s website could not be read when we checked, so this page prints no payout rate. Ask for the rate and the form in writing.
Watch out: Confirm the system size limit with Black Hills before you pick a size.
Also: battery tax credit, tax exemptions.
Colorado Springs UtilitiesColorado Springs area. Owned by the city.Full credits today. New rates from April 1, 2027.
What you can get with Colorado Springs Utilities
- Bill credits todayOne for one
Net metering: extra kWh are banked and roll forward to later bills.
- Year-end creditabout 2 cents per kWh
Paid on your January bill for kWh left at year end. Example: 1,000 kWh earn about $20. Or opt for rollover, a one-time choice that cannot be undone.
- Solar or battery rebateNone
Joining costs an application fee of $100.
Your bill credits
From April 1, 2027 solar homes pick one of two plans. Plan 1 adds a grid access charge of $1.00 a day and prices power by time of day, with a peak from 5 to 9 p.m., Monday to Friday. Plan 2 adds a demand charge: a fee based on your highest 15 minutes of use in peak hours. The utility estimates either plan adds about $38 a month to a solar home’s bill.
Watch out: An agreement dated before April 1, 2027 moves to the new rates on April 1, 2032. The utility says rate structures are not guaranteed under a net metering agreement.
Also: battery tax credit, tax exemptions.
Holy Cross EnergyVail, Aspen and Glenwood Springs areas. A member-owned co-op.$100 per kW for panels. Up to $12,500 for a battery.
What you can get with Holy Cross Energy
- Solar rebate$100 per kW
On up to 25 kW. Example: 5 kW gets $500. Get the HCE Approval Letter before building starts, and finish within 120 days.
- Battery rebate, Time of Use rateUp to $12,500
The lower of $250 per kW of battery power or $100 per kWh of storage. Only on the Time of Use rate: a plan where the price of power changes by time of day.
- Power+FLEX battery program$500 per kW
Per kW of battery power you let Holy Cross use, plus $10.60 per kW each month for 5 years. Example: 5 kW gets $2,500 upfront and $53 a month. You can take only one battery offer.
Your bill credits
Holy Cross nets your solar against your use each month (net metering). You still pay a customer charge and a demand charge, a fee for the most power you use at one moment. Your system may supply no more than 200% of your past year’s use.
Watch out: No payment can exceed 40% of the installed cost. Funds are first come, first served.
Also: battery tax credit, tax exemptions.
CORE, United Power or another co-op or city utilityCo-ops and city-owned utilities in the rest of Colorado.Bill credits by state law. Rebates are rare.
What you can get with CORE, United Power or another co-op or city utility
- Monthly bill creditsOne for one
Net metering: state law makes every co-op, and every city utility with 5,000 or more customers, carry your extra kWh forward month to month, for home systems of at least 10 kW.
- CORE Electric CooperativeUp to 10 kW
A bigger system is not net metered. It is paid CORE’s avoided cost, the low price the co-op would pay for that power elsewhere: 4.616 cents per kWh. Example: 1,000 kWh earn $46.16.
- United PowerNo rebate
A system may make no more than 200% of your yearly use.
Your bill credits
The year-end rule is each utility’s own. CORE pays or credits leftover kWh within 60 days after the April billing cycle, at its average avoided cost. United Power cashes them out each April to March year at its wholesale energy rate, the price it pays for power in bulk.
Watch out: United Power says rate or net metering changes will not be grandfathered. Ask your co-op for its year-end rate in writing.
Also: battery tax credit, tax exemptions.
See what installers quote for your Colorado utility
Your ZIP code starts a quote request with installers who work in your area. Ask each one which rebate, if any, your utility pays, and get it in writing.
- Your utility sets the moneyXcel, Black Hills, Colorado Springs Utilities, Holy Cross and the co-ops each have their own rules.
- Adding a battery changes the mathMost Colorado cash programs are for batteries.
- Shared only with matched installersYour details go to the installers you are matched with.
Colorado’s year-end choice: roll your solar credits over, or take the payout?
During the year, each extra kWh covers one kWh you use later. Value is lost at year end, when some kWh are still unused. For Xcel and Black Hills, state law (C.R.S. 40-2-124) treats rollover as the standard path. Xcel’s form works the other way: send no form, and you get the payout.
| Utility | If you do nothing | Payout rate |
|---|---|---|
| Xcel Energy | Paid out by check. Rollover is a permanent choice | 1.529 cents per kWh (2023) |
| Black Hills Energy | Ask which path is the default | Not confirmed |
| Colorado Springs Utilities | Credited on your January bill. Rollover is a one-time choice | about 2 cents per kWh |
| CORE Electric Cooperative | Paid or credited after the April billing cycle | Its average avoided cost: what it would pay for power elsewhere |
| United Power | Cashed out each April to March year | Its wholesale energy rate: its bulk power price |
Colorado’s battery money: a 10% state tax credit, plus utility payments
Colorado has no income tax credit for solar panels: the state’s 2025 income tax credit schedule (form DR 0104CR) lists none. It has one for home batteries. State law (C.R.S. 39-22-546) gives an income tax credit of 10% of the battery’s purchase price: the equipment, sales tax and freight, not labor or permit fees. Example: a purchase price of $10,000 earns $1,000.
Claim it on your Colorado income tax return for the year you buy. Or assign it to the seller when you buy: you sign an agreement, and the seller must pay you the full value of the credit.
- Xcel Energy: $250 per kW of battery power upfront, more for lower incomes. See the Xcel panel.
- Holy Cross Energy: up to $12,500. See the Holy Cross panel.
Watch out: If you lease a battery, you get no credit. It covers tax years through 2029. Ask the Colorado Department of Revenue or your tax preparer which form to use.
Colorado’s two solar tax exemptions: what the state skips, and what your city may still charge
Sales tax: the state part only
Colorado does not charge its 2.9% state sales tax on the parts that make solar power: panels, inverters, racking and wiring. The law is C.R.S. 39-26-724. Example: on $10,000 of equipment, that is $290. Labor is not covered. Home batteries have their own state exemption (C.R.S. 39-26-733), set to end on January 1, 2033.
Watch out: City and county sales taxes still apply unless your local government has adopted the exemption. Ask your installer to show the tax lines on the quote.
Property tax: the equipment is exempt
Solar equipment on a home is exempt from Colorado property tax. The law is C.R.S. 39-3-102. That holds when you own the system and it powers your home. It also holds when a company owns it under a lease or a PPA (a contract to buy the power the panels make), up to 100 kW.
The exemption covers the equipment, not the land or the building. If your notice of valuation lists home solar equipment, contact your county assessor.
Lower-income homes and renters: Solar*Rewards and community solar
Xcel Solar*Rewards: the one large panel rebate
Xcel pays $3 per watt upfront to income-qualified homes, on systems up to 10 kW. Xcel’s online form checks if you qualify. A 5 kW system is 5,000 watts, so it gets $15,000. For scale: a typical Colorado system is 4.88 kW and costs about $14,835 before incentives.
Homes that qualify only by address get $0.50 per watt. The address must be in a disproportionately impacted community, an area on a state list of that name.
Xcel’s 2026 budget is $1,000,000. Xcel posts how much is left on its Solar*Rewards page, and the figure changes as homes apply. Ask Xcel how much is left before you sign. The check comes within 60 days after Xcel lets you switch the system on.
Watch out: One paragraph on Xcel’s page still shows the old amount, $1 per watt. In September 2026 Xcel gave notice of possible rule changes. Get the amount in writing before work starts.
No roof of your own
Xcel and Black Hills customers can subscribe to community solar: a shared solar farm whose output is a credit on your bill, for 20 years. Income-qualified subscribers must get a discount of at least 25%. That means income at or below 200% of the federal poverty line or 80% of area median income (the middle income in your area).
Boulder, Eagle County and the mountain co-ops: smaller local programs
Each depends on funds.
- City of Boulder: a grant of $1 per watt, up to $8,000, for income-qualified owners ($121,800 for a household of four). Also a refund of about 15% of the city sales tax on a solar or battery project.
- Eagle County: up to $1,000 for solar and $1,000 for a battery, never more than your utility’s rebate.
- Three co-ops: Mountain Parks Electric pays $500 per system for members who pay into its Clean Power Program. San Miguel Power pays $0.10 per watt, up to $300. La Plata Electric pays $1,000 to $2,000 for a home battery.
Five ways Colorado homeowners miss the money
- You expect an Xcel rebate for panels on a typical home. It is only for income-qualified homes and homes in listed communities.
- Work starts before the approval. Holy Cross requires its Approval Letter first. Xcel says to wait for full approval.
- You never send Xcel’s Solar Bank Election Form. Leftover kWh are then paid out at the low year-end rate. To switch for this year, send it by December 1.
- You lease the battery. The 10% state tax credit goes to the buyer, not to someone who leases.
- Your CORE system is larger than 10 kW. CORE does not net meter it. You are paid 4.616 cents per kWh for what you send out.
Colorado solar paperwork: who files what, and when
- Before you sign: name your utility. Check its rebate, size limit and year-end rule. Lower-income Xcel homes: fill in Xcel’s eligibility form first.You, with your installer.
- Before any building: the interconnection application. This asks your utility for permission to connect. Holy Cross and Xcel rebates need approval before work starts.Your installer.
- At purchase: check the tax lines. No state sales tax on solar equipment or a home battery. To have the seller pay you the battery tax credit, sign the assignment agreement now. Otherwise claim 10% on your Colorado return for that year.You and the seller.
- After switch-on: make your year-end choice. Xcel customers send the Solar Bank Election Form. Colorado Springs customers manage rollover online.You.
Request Colorado quotes, then check the year-end line
Enter your ZIP code to request quotes from installers in your area. Ask each one to name your utility and to show what happens to unused credits at year end.
The form asks about your home first, then your contact details. EcoGen or its installer partners may contact you.
- A quote request, nothing moreThe form asks installers near you for quotes. It does not apply for a rebate or a tax credit.
- Home questions firstYou answer a few questions about your home. Your name, email and phone come last.
- No cost to compareQuotes are free. You are never obliged to sign.
More Colorado solar guides
Colorado solar incentive questions
Does Colorado Have a Solar Tax Credit?
Not for solar panels. The state’s 2025 income tax credit schedule (form DR 0104CR) lists no solar credit. Colorado gives a state income tax credit of 10% of the purchase price of a home battery, through tax year 2029. The federal credit is not available for systems switched on after December 31, 2025.
Does Colorado Have Net Metering?
Yes. State law requires it from Xcel Energy, Black Hills Energy, electric co-ops and city utilities with 5,000 or more customers. Year-end rules differ by utility.
Does Xcel Energy Pay a Solar Rebate in Colorado?
Only to income-qualified homes ($3 per watt, up to 10 kW) and to homes in areas the state lists as disproportionately impacted ($0.50 per watt). The 2026 budget is $1,000,000. Ask Xcel how much is left.
What Is Changing for Solar Customers in Colorado Springs?
New rates start on April 1, 2027. Solar homes will choose between a daily grid access charge and a charge based on their highest use in peak hours. The utility estimates a bill increase of about $38 a month.
Do Solar Panels Raise Property Taxes in Colorado?
No. Solar equipment on a home is exempt from property tax, whether you own it or a company owns it (up to 100 kW).
Sources (22)
- 2026 Colorado Revised Statutes, Title 40 (40-2-124, 40-2-127.2, 40-9.5-118): olls.info
- 2026 Colorado Revised Statutes, Title 39 (39-1-102, 39-3-102, 39-22-546, 39-26-106, 39-26-724, 39-26-733): olls.info
- Colorado Department of Revenue, 2025 Individual Credit Schedule (DR 0104CR): tax.colorado.gov
- Colorado Division of Property Taxation, Renewable and Clean Energy Assessment: dpt.colorado.gov
- Xcel Energy, Solar*Rewards program page (Colorado): co.my.xcelenergy.com
- Xcel Energy, Colorado Solar Bank Election Form: xcelenergy.com
- Colorado PUC, Decision No. R26-0064: dora.state.co.us
- Colorado Springs Utilities, Solar Energy Program: csu.org
- Colorado Springs Utilities, Approved solar rate changes: csu.org
- CORE Electric Cooperative, Rooftop solar: core.coop
- CORE, Rates and Regulations, September 2026: core.coop
- United Power, Connect your solar: unitedpower.com
- Holy Cross Energy, Solar + Battery Energy Storage: holycross.com
- Holy Cross Energy, Power+FLEX: holycross.com
- City of Boulder, Solar grants: bouldercolorado.gov
- City of Boulder, Solar and battery system tax rebates: bouldercolorado.gov
- Energy Smart Colorado, 2026 Eagle County rebates: energysmartcolorado.org
- Mountain Parks Electric, Clean Power Program: mpei.com
- San Miguel Power Association, Renewable rebates: smpa.com
- La Plata Electric Association, Battery rebates: lpea.coop
- IRS, Residential Clean Energy Credit: irs.gov
- EcoGen Solar Cost Index, Colorado: ecogenamerica.com
