2023 Solar Incentives Guide for Berkeley, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Berkeley.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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Updated September 15, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Berkeley?
Property Tax Exclusion for Solar Energy Systems and Solar Plus Storage System
Western Riverside Council of Governments - Home Energy Renovation Opportunity (HERO) Financing Program
Minimum financing: $5,000
The financing may not exceed fifteen percent (15%) of the market value of the property, up to the first seven hundred thousand dollars ($700,000) of the property’s market value, and ten percent (10%) of the remaining value of the Property above seven hundred thousand dollars ($700,000) minus any PACE assessment on the property The total amount of any annual property taxes and assessments shall not exceed five percent (5%) of the property's fair market value, determined at the time program financing is approved.
Local Option - Municipal Energy Districts
Self-Generation Incentive Program
Incentives will step down over time. See below for incentive amounts.
Renewable Market Adjusting Tariff (ReMAT)
LADWP - Feed-in Tariff (FiT) Program
Base price will step down over time as certain MW goals are met
California Solar Initiative - Solar Thermal Program
Single Family Residential Incentives:
Systems that displace natural gas: $29.85 per estimated therm displaced
Systems that displace electricity or propane: Funding has been exhausted
Commercial/Multifamily Incentives:
Systems that displace natural gas: $20.19 per estimated therm displaced
Systems that displace electricity or propane: $0.42 per estimated kWh displaced *** Note, funding has been exhausted in this category for SCE and PG&E
Solar Pool heating: $5.00 per estimated therm displaced
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are intended to make renewable energy usage more affordable through financial incentives for individuals who install solar panels on their homes. You may qualify for various kinds of incentives, including discounts, cash back or monthly utility bill credits, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of California and others from the federal government. Some solar incentives you might qualify for are:
- Net Metering: Don't forget to talk to your Berkeley utility company about signing a net metering contract. This will allow you to receive credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You could receive either a dollar-for-dollar credit or a percentage of the value.
- Tax Exemptions: These could come in the form of property tax exemptions, which can let you exclude the value of your solar system when paying property tax on your home. They may also include exemptions on sales tax at the time of purchase.
- Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives may be available to you if your solar system produces more than a specified (usually small) amount of electricity. Performance-based incentives are typically handled at the state level. You can sell SRECs to your utility company or other buyers, and the money you receive in return is typically considered part of your taxable income.
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
- Rebates: Some solar companies will help you claim a rebate, or partial refund after purchase, for your solar panels. States or counties will also offer limited-time rebates at various times. Any rebates you receive will usually come off your total price before any tax credits are calculated.
Best Regional Coverage
Momentum Solar
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Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some familiarity with. One of the incentives many people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a specified percentage of the cost of your solar system.
The ITC originally covered 30% of the cost of installing a solar system, and has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total installation cost includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum amount you can claim. The ITC can be applied to solar panels installed after January 1, 2006 on your primary or secondary residence. The residence must be owned by you and in the United States.
Contacting your local Berkeley solar panel installation expert is the best way to understand how the ITC applies to you.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now titled the Clean Energy Credit. For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners can receive a credit for 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit expires in 2035. The program expansion also makes it easier to get credit for energy storage systems, starting in 2023.
Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit applies to you, talk to your local Berkeley solar installation expert.
State & Local Solar Incentives
Federal solar incentives are not your only option; rebates, tax credits and more are often offered at the state and local level. Some incentives are ongoing, while others are offered for only a limited time. Local solar incentives could come from your county or municipality, or from the California government.
Next Steps for Installing Solar in Berkeley
Solar incentives can be offered by your local utlity company, the California government or the federal government. The variety of available solar incentives has contributed to a large increase in solar energy use in the last 15 years. Contact your local solar panel installation company today to learn more and to save the most money possible on a solar system for your Berkeley home.
EcoWatch's Berkeley, CA Solar Incentives FAQs
How do I learn if I qualify for specific solar incentives?
It's a smart idea to get in touch with your local Berkeley solar installer to get an understanding of which incentives your project may qualify for. Typically, solar incentives apply to new solar systems installed on a property you own (in the U.S.) within a specified date range. Some incentives, such as those given by the state of California, might have additional requirements.
I already have solar panels installed. Does my system qualify for any incentives?
If your solar panels were installed after January 1, 2022, you may qualify for the recently increased 30% tax credit under the Inflation Reduction Act. If you installed your system between 2006 and 2021, you might qualify for a tax credit between 26% and 30%, depending on the date of installation. Speaking with a representative from the company that installed your system, or any local Berkeley solar installer, can help you understand what incentives you might want to apply for.
How long until the federal solar tax credit ends?
The federal solar tax credit, previously called the ITC and now named the Clean Energy Credit, is scheduled to end January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
Can I receive incentives both towards the initial cost of solar panels, and later as reimbursement?
The order that incentives will be applied in might vary depending on which incentives you receive but in most cases yes, you can receive multiple types of incentives for your solar project. Speak to your solar installer or a local tax professional to ensure you are claiming all of the incentives you qualify for and applying them in the correct order.
Can I use both solar and another type of renewable energy to power my home?
Yes, you can utilize multiple types of renewable energy to power your home, such as a combination of geothermal and solar. You can also use both renewable energy sources and a non-renewable backup source of energy. Be sure to discuss your plan with your local Berkeley solar installation expert, to make sure you know what you'll need and what incentives you will or won't qualify for.
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.