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NuWatt designs, installs, and manages solar, battery, heat pump, and EV charger systems across 9 states. One company, one warranty, one point of contact.
Get a Free QuoteThe OBBBA eliminated the residential solar and heat pump tax credits. But solar is not dead -- it is more affordable than ever. This guide covers exactly what expired, what still works, every remaining deadline, state-by-state incentives across all 9 NuWatt markets, why solar lease and PPA are now the smart play, and a timeline for when to act on each remaining credit.
$0
25D/25C Credits (Expired)
Jun 30
30C EV Charger Deadline
Jul 4
48E Construction Deadline
-40%
Panel Price Drop Since 2020
Quick Answer
The OBBBA (signed July 4, 2025) eliminated the Section 25D residential solar ITC and the Section 25C home efficiency credit, both expired December 31, 2025. Homeowners who buy solar with cash or a loan in 2026 get zero federal credit. However, two credits remain active: the Section 30C EV charger credit (30%, through June 30, 2026) and the Section 48/48E commercial ITC (30-50%, construction deadline July 4, 2026). Homeowners can still access the 48/48E credit through TPO structures like Propel, solar leases, and PPAs. Solar is still worth it: panel prices dropped 40% since 2020 ($2.80-3.20/W), utility rates keep rising 3-5%/year, and all state incentives across MA, CT, NJ, RI, NH, VT, ME, PA, and TX remain fully active.
The One Big Beautiful Bill Act (OBBBA) was signed into law on July 4, 2025 as a sweeping tax and spending package. Among dozens of provisions, it fundamentally restructured the federal clean energy tax credit landscape. The changes were not subtle. Residential homeowners lost their two most valuable federal incentives overnight.
The Inflation Reduction Act (IRA) of 2022 had restored the Section 25D residential solar credit to 30% through 2032 and expanded the Section 25C efficiency credit to cover heat pumps ($2,000 cap), insulation, windows, and HVAC equipment ($1,200 cap). The OBBBA accelerated the expiration of both credits to December 31, 2025 -- seven years ahead of the original IRA schedule.
For the solar industry, this was the biggest policy shift since the original Section 25D enactment in 2006. But the story does not end with the loss of residential credits. The commercial ITC (Section 48/48E) survived, and with it, the entire third-party ownership (TPO) ecosystem. This is the critical nuance that most media coverage misses: the mechanism for accessing federal solar incentives shifted from direct homeowner credits to indirect benefits through TPO structures.
Expired
Still Active
Status
Expired Dec 31, 2025
Credit Amount
$0 (was 30%)
Who Is Affected
Cash/loan buyers
Section 25D allowed individual homeowners to claim a 30% federal tax credit on the total cost of a solar installation. A homeowner who purchased a $30,000 system in 2025 could claim a $9,000 credit on their federal return. In 2026, that same homeowner receives nothing. The OBBBA accelerated this expiration from the original IRA timeline of 2032.
What to do: If you installed solar in 2025 but have not filed taxes yet, you can still claim 25D on your 2025 return. For 2026 installations, consider Propel or a lease/PPA to access the Section 48/48E credit indirectly.
Status
Expired Dec 31, 2025
Was Worth
Up to $3,200/yr
Covered
Heat pumps, insulation, windows
Section 25C provided up to $2,000 for qualifying heat pump installations and up to $1,200 for other energy efficiency improvements (insulation, windows, doors, HVAC). The annual cap was $3,200. In 2026, these federal credits are gone.
What to do: State heat pump rebate programs remain fully active. Massachusetts Mass Save offers up to $10,000, Connecticut Energize CT up to $7,500, New Hampshire NHSaves up to $4,500, and Maine Efficiency Maine up to $4,000. These state programs are independent of federal credits.
Deadline
June 30, 2026
Credit Amount
30% (up to $1,000)
Requirement
Qualifying census tract
Section 30C is the last remaining direct-to-homeowner federal clean energy credit. It covers 30% of EV charging equipment and installation costs, up to $1,000 for residential and $100,000 for commercial. The property must be located in a qualifying census tract (low-income community or non-urban area). Many suburban and rural locations in NuWatt's service area qualify.
Action required: Install your EV charger before June 30, 2026. Check eligibility at our Section 30C deadline guide. This is the last chance for a direct homeowner credit on any clean energy equipment.
Deadline
July 4, 2026 (construction start)
Credit Amount
30-50% ITC
Accessible Via
Propel, lease, PPA, commercial
Section 48/48E is the commercial/investment tax credit for business-owned clean energy assets. It provides 30% ITC at baseline, with adders for domestic content (10%), energy communities (10%), and low-income projects (10-20%). While homeowners cannot claim this credit directly, they can access it through TPO structures where a business entity owns the solar system.
This is why TPO is now king: With 25D gone, the only way homeowners can access any federal solar credit is through Section 48/48E via Propel, a solar lease, or a PPA. The TPO company claims the credit and passes savings through lower payments. Construction must begin before July 4, 2026.
The loss of the 30% residential credit is real, but the narrative that “solar is dead” is wrong. Here are four reasons solar remains a strong investment in 2026:
The average installed cost of residential solar has fallen from $4.50-5.00/W in 2020 to $2.80-3.20/W in 2026. A system that cost $36,000 in 2020 now costs approximately $24,000 before any incentives. The price decline partially offsets the lost tax credit. Module prices alone have dropped over 50% due to manufacturing scale and polysilicon oversupply.
Northeast electricity rates average $0.25-0.35/kWh in 2026 and have risen 3-5% annually over the past decade. At 4% annual increases, today's $0.30/kWh becomes $0.44/kWh in 10 years and $0.66/kWh in 20 years. Solar locks in your electricity cost at today's prices for 25-40 years. Every year you wait, the cost of doing nothing goes up.
Before the OBBBA, cash/loan and TPO were roughly comparable because both accessed federal credits (25D vs 48E). Now, only TPO retains the credit. A $30,000 cash purchase gets $0 in federal credits. The same system through a lease or PPA captures $9,000-15,000 in 48/48E value and passes it to you. TPO market share has jumped from approximately 45% in 2025 to a projected 69% in 2026. The math strongly favors TPO.
State-level programs are completely independent of federal tax credits. SMART 3.0 in Massachusetts, ADI/SREC-II in New Jersey, REF/REG in Rhode Island, net metering everywhere -- all remain fully active. Combined with lower panel prices and TPO access to 48/48E, the total incentive stack in 2026 is still substantial in most NuWatt markets. See the state-by-state table below for details.
Bottom Line
A typical 8 kW system in Massachusetts costs about $24,000 installed in 2026 (down from $36,000 in 2020). Without any credit, payback is 7-10 years with state incentives and net metering. With Propel or a lease/PPA capturing the 48/48E credit, effective payback drops to 5-7 years. Over 25 years, total electricity savings are $57,000-80,000+ at current rates (more with rate increases). Solar remains a strong investment -- the financing decision has just become more important than ever.
Here is how the numbers compare for a typical 8 kW system (9,200 kWh/year production) across different purchase methods:
| Metric | 2025 Cash (with 25D) | 2026 Cash (no credit) | 2026 Propel/TPO |
|---|---|---|---|
| Installed cost (8 kW) | $28,000 | $24,000 | $0 down |
| Federal credit | -$8,400 (30%) | $0 | 30-50% via investor |
| Net cost to homeowner | $19,600 | $24,000 | ~$65K total payments (25 yr) |
| Year 1 electricity savings | $2,760 | $2,760 | $2,760 value (offset by payment) |
| Simple payback | 7.1 years | 8.7 years | Year 5 (ownership transfer) |
| State incentives | SMART + NM + exemptions | SMART + NM + exemptions | SMART + NM + exemptions |
| 25-year ROI | 250-300% | 180-230% | Owned system + 20 yr savings |
| Monthly out-of-pocket | $0 (lump sum) | $0 (lump sum) | ~$200-250/mo fixed |
Propel is NuWatt's answer to the post-25D world. It is a $0-down solar financing product that uses a third-party ownership (TPO) structure to capture the Section 48/48E commercial ITC -- the same credit that cash buyers can no longer access.
Step 1
Investor Owns System
A business entity owns your solar panels and claims the Section 48/48E ITC (30-50%).
Step 2
You Pay Fixed Monthly
$0 down. Fixed monthly payments with 0% escalator. Lower than your current electric bill.
Step 3
Ownership at Year 5
Automatic ownership transfer at Year 5. You own the system outright with 20+ years of life remaining.
Step 4
25 Years of Savings
After ownership transfer, all electricity savings are 100% yours. No more payments.
Construction Deadline: July 4, 2026
Propel relies on the Section 48/48E ITC, which requires construction to begin before July 4, 2026. “Begin construction” means either physical work of a significant nature or the 5% safe harbor (paying 5% of total project cost). If you are considering Propel, start the process now to ensure your installation begins before the deadline.
Propel is currently available in Maine and Texas. Learn more about Propel or see how it compares to traditional lease/PPA in our solar without tax credit guide.
Every state incentive listed below is independent of the expired federal Section 25D credit. These programs are funded by state legislatures, utility ratepayers, or renewable portfolio standards -- not by the federal government. They remain fully active and can be combined with TPO structures (Propel, lease, PPA) that capture the Section 48/48E commercial ITC.
| State | Key Solar Programs | Heat Pump | Battery | Tax Exemptions |
|---|---|---|---|---|
| MA | SMART performance payments + 1:1 net metering | Up to $10,000 (Mass Save) | ConnectedSolutions ($275/kWh/season) | Property (20 yr) + Sales tax |
| CT | RRES performance tariff + 1:1 net metering | Up to $7,500 (Energize CT) | ESS program incentives | Property + Sales tax |
| NJ | ADI $85.90/MWh for 15 years | Whole Home rebate program | Grid supply incentives | Property + Sales tax |
| RI | REF $0.65/W + REG $0.27/kWh (15 yr) | Rhode Island Energy rebates | Net metering with storage | Property + Sales tax |
| NH | 1:1 net metering up to 100% usage | Up to $4,500 (NHSaves) | Group net metering available | Property tax exempt |
| VT | Retail rate net metering credit | Efficiency Vermont rebates | GMP battery program | Property + Sales tax |
| ME | 1:1 net energy billing equivalent | Up to $4,000 (Efficiency Maine) | Net metering with storage | Property tax exempt |
| PA | SRECs $25-35/MWh (market rate) | Act 129 utility rebates | Net metering available | Varies by municipality |
| TX | Highest savings via rate arbitrage + REP buyback | Limited utility programs | Peak shaving + arbitrage | Property tax 100% exempt |
Programs: SMART 3.0, Mass Save, ConnectedSolutions
Programs: RRES, Smart-E Loans, ESS Program, Energize CT
Programs: ADI/SREC-II, NJ Clean Energy, Whole Home
Programs: REF, REG, Rhode Island Energy
Programs: NHSaves, Net metering
Programs: Net metering, Efficiency Vermont, GMP
Programs: Net energy billing, Efficiency Maine
Programs: SRECs, Act 129
Programs: ERCOT, REP buyback
The Section 25C federal credit for heat pumps ($2,000) expired December 31, 2025. But state heat pump rebate programs are funded independently and remain fully active. In several states, the state rebate alone exceeds what the federal credit was worth:
Mass Save
Up to $10,000
Income-eligible customers may receive enhanced incentives. Covers ductless and ducted systems.
Energize CT
Up to $7,500
Rebates for qualifying ASHP and GSHP installations through Energize CT program.
NHSaves
Up to $4,500
Rebates for qualifying heat pump installations. Multiple utility participants.
Efficiency Maine
Up to $4,000
Rebates for heat pumps including whole-home systems. Income-eligible enhanced rebates.
Efficiency Vermont
Rebates available
Rebates for cold-climate heat pumps through Efficiency Vermont program.
RI Energy
Rebates available
Rhode Island Energy offers heat pump rebates for residential customers.
Heat Pumps + Solar = Best Combo in 2026
With no federal credit for either product individually, bundling solar + heat pump maximizes savings. Solar offsets the electricity that powers the heat pump. State rebates cover the heat pump cost. And a solar TPO structure captures the 48/48E credit. The combined package delivers the best economics of any single-product approach. See our complete 2026 solar analysis.
Section 30C is the last remaining federal tax credit that homeowners can claim directly on their personal tax return. It expires June 30, 2026. If you are planning an EV charger installation, this is your last chance for a federal credit.
Credit Amount
30%
Residential Cap
$1,000
Commercial Cap
$100,000
Deadline
June 30, 2026
For full eligibility details, census tract lookup, and step-by-step claiming instructions, see our Section 30C deadline guide.
Track the remaining federal credit deadlines in real time and check which incentives are available in your state.
EXPIRED
Expired December 31, 2025
Residential clean energy tax credit for homeowner-purchased solar, heat pumps, and battery storage.
Applies to: Homeowners who purchased solar with cash or loan
EXPIRED
Expired December 31, 2025
Energy efficient home improvement credit for heat pumps, insulation, windows, and HVAC equipment.
Applies to: Homeowners who purchased qualifying efficiency upgrades
80
Days
08
Hrs
04
Min
14
Sec
30% credit (up to $1,000 residential / $100,000 commercial) for EV charging equipment installation.
Applies to: Homeowners and businesses installing EV chargers
84
Days
08
Hrs
04
Min
14
Sec
30-50% investment tax credit for business-owned clean energy. Accessible to homeowners via TPO structures (Propel, lease, PPA).
Applies to: Businesses, investors, and homeowners via TPO
Select your state to see which incentives are still available after the federal tax credit expired.
Select a state above to see available incentives
NuWatt serves MA, CT, NJ, RI, NH, VT, ME, PA, and TX
NOW -- April 2026: Start your solar TPO process (Propel, lease, or PPA)
The Section 48/48E construction deadline is July 4, 2026. Solar installations take 4-8 weeks from contract to construction start. If you want to begin construction before the deadline, you need to start the process now. Get quotes, compare options, and sign a contract by early May.
NOW -- May 2026: Install your EV charger (Section 30C)
The Section 30C credit expires June 30, 2026. EV charger installations take 1-3 weeks. Schedule your installation now to ensure completion before the deadline. Verify your property is in a qualifying census tract before committing.
May 2026: Lock in solar TPO contract and 5% safe harbor payment
To meet the July 4 construction-start deadline, your TPO company needs to make a 5% safe harbor payment or begin physical work by July 4. Contracts typically need to be signed 4-6 weeks before construction. May is the last comfortable month to finalize.
June 30, 2026: Section 30C EV charger credit EXPIRES
Last day the Section 30C Alternative Fuel Vehicle Refueling Property Credit is available. After this date, there is zero federal credit for EV charger installations. This is the last direct-to-homeowner federal clean energy credit.
July 4, 2026: Section 48/48E construction deadline
Last day to begin construction under current Section 48/48E terms. After this date, the commercial ITC may change or expire. TPO structures (Propel, lease, PPA) that have not started construction lose access to the current credit terms.
After July 4, 2026: State incentives only (still strong)
If both federal deadlines pass, state incentives and lower panel prices still make solar viable. SMART 3.0, SRECs, net metering, and tax exemptions remain. Payback is longer but ROI is still positive. Do not abandon the plan -- adjust the financing structure.
Section 30C (EV charger) expires June 30. Section 48/48E (solar TPO) construction deadline is July 4. State incentives remain, but the federal window is closing. NuWatt offers Propel ($0-down TPO), standard leases, PPAs, cash, and loan options. Get started now to lock in the remaining federal benefit.
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