Unlock savings: Tax Credits Available to Businesses, Nonprofits for Clean Energy Upgrades
January 7, 2026
Federal clean energy tax credits and incentives are still available for Michigan businesses and tax-exempt entities considering investments for energy efficiency – and now is the time to take advantage of some that will phase out in the coming months.
Deadlines are as soon as June 30, 2026, and every dollar in credits that can be claimed before these cuts fully take effect amounts to real money saved.
Federal clean energy tax credits – and the new elective pay (aka direct pay) mechanism that provides tax-exempt entities the equivalent of these credits – play a critical role in making clean energy sources more affordable. They cover 30% or more of costs connected to solar panels; geothermal heating, ventilation, and cooling (HVAC) systems; and battery storage.
Credits can support Michigan businesses that produce clean energy or manufacture clean energy components in the state. Energy efficiency building improvements help Michigan business owners and nonprofits lower their monthly utility bills and save money over the long term.
Not only have these incentives saved working families and businesses thousands of dollars, they also have helped advance goals in the MI Healthy Climate Plan, supported jobs in Michigan, and ensured reliable energy as demand for electricity continues to grow.
Michigan business owners and tax-exempt organizations such as municipalities, school districts, nonprofits, and houses of worship are encouraged to explore and use these cost-saving programs before they expire.
Below is a list of commercial credits. Those eligible to be claimed by tax-exempt entities using elective pay are marked with an asterisk (*).
Commercial Clean Energy Tax Credit Timelines
As noted above, certain tax credits will need to comply with PFE guidelines beginning Jan. 1, 2026.
Courtesy of MI Department of Environment, Great Lakes, and Energy
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