2025 Solar Incentives Guide for Brea, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Brea.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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What Solar Tax Credits, Incentives, and Rebates are Available in Brea?
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 propertyThe 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/
The phrase "solar incentives" covers a wide range of financial incentives implemented to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. You may qualify for various kinds of incentives, such as discounts, cash back or credit towards your monthly utility bill, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the California government and others from the federal government. Types of solar incentives might include:
- Tax Credits: Tax credits decrease, dollar-for-dollar, how much income tax you owe the federal government. These differ from tax deductions.
- Rebates: A rebate is a partial refund credited to your account after you've paid for your solar system. Rebates may be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.
- Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are usually handled by your state government. Once your solar panel system meets a predetermined threshold (normally a small amount of energy production), you can receive SRECs that can be sold to your utility company or other buyers. The money you receive from the sale is generally considered part of your taxable income.
- Tax Exemptions: These can come in the form of property tax exemptions, which would allow you to ignore 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.
- Net Metering: Don't forget to talk with your Brea utility company about signing a net metering agreement. This will allow you to receive credit towards your utility bill every month for the value of excess energy your solar panels generate. You could receive either a dollar-for-dollar credit or a percentage of the value.
Federal Solar Incentives
When thinking about solar incentives, federal incentives are likely the first thing that comes to mind. One of the incentives many people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a certain percentage of your solar system's cost.
The ITC applies to solar panels installed on your primary or secondary residence in the United States. The solar panels have to have been installed after January 1, 2006, on a property owned by you for you to be eligible for the credit. The ITC originally paid out 30% of all costs (panels, equipment, labor and accessories), although this amount has fluctuated over the years between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the claim amount.
Your local Brea solar panel installation expert can give you more information about the ITC and how it may apply to your situation.
In August 2022, the Inflation Reduction Act expanded and extended the ITC, now called the Clean Energy Credit. The Clean Energy Credit re-raises the credit up to 30% for solar installations undertaken between January 1, 2022, and December 31, 2032. After 2032, the credit percentage will be reduced slightly each year until the end of the program in 2035. Starting in 2023, it will also be easier to qualify for credits for energy storage systems under the new laws.
Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit will apply to you, get in touch with your local Brea solar installation expert.
State & Local Solar Incentives
There are more than just federal solar incentives; rebates, tax credits and more may be offered at the local or state level. Incentives may be given by the state of California, or by your county or municipality. Certain incentives may be available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Brea
You can apply for and receive solar incentives from the federal government and the California government, as well as from your local utility company. This increase in availability of solar initiatives in the past 15 years has helped increase nationwide solar energy use enormously. Reach out to your local solar panel installation company today to discover more about the various programs and to save the most money possible on a solar system for your Brea home.
EcoWatch's Brea, CA Solar Incentives FAQs
How do I learn if I qualify for solar incentives?
It's a smart idea to get in touch with your local Brea solar installer for a better understanding of which incentives your project may qualify for. Generally, solar incentives apply to new solar panel 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, may have additional requirements.
What are some of the environmental benefits of switching to solar?
Solar energy is renewable — by switching where you get your energy, you help lessen the strain on our planet's resources. Solar panels can also lower the CO2 emissions from your home by 250 pounds a year, or roughly 5,000 pounds in 20 years.
When does the federal solar tax credit end?
The Clean Energy Credit (formerly called the federal solar tax credit, or ITC), is scheduled to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
I want to trade in my old appliances for ones that are more energy-efficient. Are there any credits I can get?
The recently passed Inflation Reduction Act includes provisions for multiple incentives meant to reward homeowners who make eco-friendly upgrades. Some incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
Can I apply for incentives both towards the up-front cost of solar panels, and later as reimbursement?
Yes, you can receive both rebates and tax credits towards the cost of your solar panels. Depending on precisely which incentives you are eligible for, they may apply in a different order. Be sure to speak with your solar installer or a local tax professional to confirm that you are claiming incentives correctly and that you're getting the most money you can.
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