2024 Solar Incentives Guide for Commerce, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Commerce.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Commerce?
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/
Solar incentives mitigate the cost of installing solar panels on your home. Financial incentives like these are intended to encourage more homeowners to make the switch to renewable energy. Incentives can include things like discounts, cash back or monthly utility bill credits. Some incentives are provided by the federal government, while others are provided by the California government or by your specific utility company, county or municipality. Some broad categories of solar incentives include:
- Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce more than a predetermined (generally small) amount of electricity can qualify for SRECs or similar performance-based incentives. SRECs and performance-based incentives in general are typically provided at the state level. You can sell SRECs to your utility company or another buyer, and this is usually considered part of your taxable income.
- Tax Exemptions: Sales tax exemptions are applied at the time of purchase for your solar panels. Property tax exemptions allow you to ignore the value added by your solar system when you calculate how much property tax you need to pay on your home.
- Net Metering: You can sign a net metering agreement with your Commerce utility company that will apply to all or a percentage of the excess electricity that is generated by your solar panels. Your utility company will then deduct this value from your utility bill each month.
- Rebates: Solar rebates may be offered by your local utility company, or by your state or county. These rebates are essentially cash back that is applied after you pay for a solar system and before tax credits are calculated.
- Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
Best National Provider
SunPower
- Most efficient panels on the market
- National coverage
- Cradle to Cradle sustainability certification
- Great warranty coverage
- Expensive
- Customer service varies by local dealer
Best Regional Coverage
Momentum Solar
- Great warranty coverage
- Representatives are experts on local policies
- Concierge service ensures steady communication
- Slightly limited service offerings
Best for Leasing
Sunrun
- Expansive service area
- Many financing options
- Some reported issues with customer service
- Some reported issues with door-to-door sales
Federal Solar Incentives
Federal solar incentives are probably the first thing that you think of when thinking about solar incentives. You might have heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit that reduces your taxes by a specified percentage of the money you spend on your solar system.
The ITC applies to the total cost of installing solar panels, including the panels themselves as well as equipment, labor and accessories. This credit can be claimed for panels installed after January 1, 2006, on a primary or secondary residence that you own and that is located in the United States. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum claim amount.
To better understand how the ITC might apply to you, get in touch with your local Commerce solar panel installation expert and ask for more information.
The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as renaming it to the Clean Energy Credit). The new Clean Energy Credit extends until 2035. Homeowners can now apply for a 30% credit for solar systems installed between January 1, 2022, and December 31, 2032. This new credit will then be decreased by a few percentage points every year until the date of expiration. Beginning in 2023, it will also be easier to claim credits for energy storage systems under this new program.
Click here to learn more about the new Inflation Reduction Act. The easiest way to learn more about how the new Clean Energy Credit applies to you is to reach out to your local Commerce solar panel installation expert with your questions.
State & Local Solar Incentives
Some solar incentives are often also offered at the local or state level. Similar to federal incentives, these could include rebates, tax credits and more. Incentives might be offered 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 Commerce
You can qualify for solar incentives from the California government and the federal government, as well as from your local utility company. 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 learn more and to save as much money as possible on solar panels for your Commerce home.
EcoWatch's Commerce, CA Solar Incentives FAQs
If my house already has solar panels, can I still claim incentives?
If your solar panels were installed after January 1, 2022, you may qualify for the newly increased 30% tax credit under the Inflation Reduction Act. If you had your system installed between 2006 and 2021, you might qualify for a tax credit between 26% and 30%, depending on the exact installation date. Reaching out to the company that installed your system, or any local Commerce solar installer, can help you learn more about what incentives you qualify for.
When does the federal solar tax credit end?
The federal solar tax credit, formerly known as the ITC and now called the Clean Energy Credit, is scheduled to end on 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 up-front cost of solar panels, and later as reimbursement?
The order in which incentives are applied might vary depending on which incentives you receive but typically 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 the incentives you're eligible for and applying them in the correct order.
Can I use multiple types of renewable energy to power my home?
You can power your home with multiple types of renewable energy, or a combination of renewable and non-renewable energy. Be sure to talk through your plan with your local Commerce solar installation expert. They can help you plan your project and also help you understand the various incentives that you may or may not qualify for.
Can I claim incentives for adding solar panels to a rental property, vacation home or commercial property?
Many solar incentives apply to a property located within the United States that you own, and most secondary residences fall into this category. There may be other solar incentives available for commercial properties, depending on the details. We recommend speaking with your local solar installer and/or tax professional to fully understand what incentives may apply to your specific situation.
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.