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
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 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
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 term "solar incentives" refers broadly to financial incentives put in place by solar companies and the government to encourage people to use renewable energy by making the installation and use of solar panels more affordable. Solar incentives might include upfront discounts, cash back or monthly credits towards your utility bill. Some incentives are given by the federal government, some by the California government and some by your utility company, county or municipality. Some broad categories of solar incentives include:
- Rebates: Solar rebates may be offered by your county or state, or by your local utility company. These rebates are essentially cash back that is applied after your purchase of solar panels and before tax credits are calculated.
- Net Metering: Net metering factors in after your solar system is up and running. If you have a net metering agreement with your Clayton utility company, the company will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this credit is dollar-for-dollar, while in other places you may make back a percentage of the value.
- Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are generally handled at the state level. Once your solar panel system meets a certain threshold (typically a small amount of energy production), you are eligible to receive SRECs that can then be sold to your utility company or other buyers. The money you make is usually considered part of your taxable income.
- Tax Credits: Tax credits decrease, dollar-for-dollar, the amount of income tax you owe the government. Tax credits differ from tax deductions.
- Tax Exemptions: Your solar panel system might qualify for exemptions on both sales and property tax. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions let you ignore the added value of the solar panels when you are calculating property taxes on your house.
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Momentum Solar
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Federal Solar Incentives
When you think about solar incentives, you probably think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is the most commonly known federal solar incentive. The ITC allows you to claim a tax credit for a predetermined percentage of your solar system's cost.
The ITC was originally for 30% of the total cost of installing solar panels, and has fluctuated slightly over the years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total installation cost includes the panels themselves as well as the cost of labor, accessories and equipment. There is no maximum claim amount. The ITC applies 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.
To know exactly how much the ITC could save you, talk to your local Clayton solar panel installer.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as retitling it the Clean Energy Credit). For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners may be eligible for a credit for 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit ends in 2035. Starting in 2023, it will also be easier to get credits for energy storage systems under this new program.
Click here to learn more about the new Inflation Reduction Act. The easiest way to fully understand how the new Clean Energy Credit will apply to you is to talk with your local Clayton solar panel company.
State & Local Solar Incentives
Some solar incentives may be offered at the local or state level. As with federal incentives, these may include rebates, tax credits and more. These solar incentives — which may be provided by your county or municipality, or by the state of California — could be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Clayton
You can apply for and receive solar incentives from the federal government and the California government, as well as from your local utility company. The growing availability of solar initiatives over the last 15 years has helped increase nationwide solar energy use enormously. Contact your local solar panel installation expert today to find out more information and to save as much money as possible on a solar system for your Clayton home.
EcoWatch's Clayton, CA Solar Incentives FAQs
How can I find out if I qualify for solar incentives?
It's a good idea to talk to your local Clayton solar installer to get an understanding of which incentives your project may qualify for. In most cases, solar incentives apply to new solar systems installed on property you own (in the U.S.) between the dates specified by the incentive. Some incentives, like those provided by the California government, may have additional requirements.
What are some environmental benefits of installing solar panels on my house?
You can decrease your carbon footprint by 250 pounds of CO2 a year by switching to solar panels. This adds up to approximately 5,000 pounds in 20 years. In addition, solar power is a renewable energy source, meaning that making the switch reduces the drain on our planet's resources.
When does the federal solar tax credit end?
The Clean Energy Credit (formerly called the federal solar tax credit, or the ITC), currently ends on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
If I trade in my appliances for ones that utilize solar energy, are there any benefits I can claim?
The recently passed Inflation Reduction Act provides multiple incentives designed to reward homeowners for making eco-friendly upgrades. Some incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.
Can I use a combination of solar and another type of renewable energy to power my home?
You can use multiple types of renewable energy, or a combination of renewable and non-renewable energy, to power your home. Be sure to discuss your plan with your local Clayton solar installation expert. They can help you with the plan for your project and give you an understanding of various incentives that you may or may not 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.