2023 Solar Incentives Guide for Clayton, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Clayton.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Clayton?
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
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
The term "solar incentives" generally refers to financial incentives that are in place to encourage people to use renewable energy by making solar panels more affordable. You might be eligible for several kinds of incentives, such as 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 California government and others from the federal government. Types of solar incentives might include:
- Tax Exemptions: Sales tax exemptions go into effect at the point of sale for your solar system. Property tax exemptions let you ignore the value that your solar panels add when you calculate the amount of property tax you need to pay on your home.
- Solar Renewable Energy Certificate (SREC): In general, solar systems that produce over a threshold (normally small) amount of electricity can qualify for SRECs or similar performance-based incentives. SRECs and similar incentives are typically offered at the state level. When you receive an SREC, you can sell it to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.
- Rebates: Rebates, or partial refunds after a purchase, are typically given before any solar tax credits are calculated. Rebates might be offered by your local utility company, by your state or by your county.
- Net Metering: You can sign a net metering contract with your Clayton utility company. This agreement may apply to all or a percentage of the excess electricity your solar panels generate. They will then deduct this value from your utility bill each month.
- Tax Credits: Tax credits reduce, dollar-for-dollar, the total amount of tax you owe the government. These differ from tax deductions.
Federal Solar Incentives
When you think about solar incentives, you likely think of federal incentives first. You may have heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit that reduces your taxes by a specified percentage of the money you spend on your solar system.
The ITC can be applied to solar panels installed after January 1, 2006 on a primary or secondary residence in the United States that you own. The credit initially covered 30% of the total cost — for panels, equipment, labor and accessories — although that amount may range from 26-30%, depending on the installation date of your solar system. There is no cap on the amount you can claim.
To best understand how the ITC could apply to you, call your local Clayton solar panel installer and ask for more information.
In August 2022, the Inflation Reduction Act made revisions to the ITC, now titled the Clean Energy Credit. The Clean Energy Credit is valid until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit. The amount will then decrease slightly on a yearly basis until the end of the current program. Beginning in 2023, it will also be easier to get credits for energy storage systems with the new act.
More information about the new Inflation Reduction Act can be found here. Your local Clayton solar panel installer can answer your questions and explain how the new Clean Energy Credit may apply to you.
State & Local Solar Incentives
Rebates, tax credits and more can be claimed at multiple levels. On top of federal solar incentives, there are often state and local ones as well. Incentives might be offered by the state of California, or by your county or municipality. Some incentives may be available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Clayton
Solar incentives might be provided by your local utlity company, the California government or the federal government. The large number of solar incentives available has helped nationwide use of solar energy increase greatly in the last 15 years. We suggest talking to your local Clayton solar installation company for more information about these incentives and to ensure that you're getting the most money possible for your solar system.
EcoWatch's Clayton, CA Solar Incentives FAQs
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