2023 Solar Incentives Guide for Danville, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Danville.
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 Danville?
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
Solar incentives are designed to make renewable energy usage more affordable through financial incentives for those who install solar panels on their homes. These incentives may include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are offered by the federal government, some by the state of California and some by your specific utility company, county or municipality. Categories of solar incentives include:
- Net Metering: Net metering factors in after your solar panels are up and running. If you've signed a net metering agreement with your Danville utility company, the company will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some areas, this credit is dollar-for-dollar, while in other areas you may make back a percentage of the value.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.
- Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives may be available to you if your solar system produces over a specified (usually small) amount of electricity. These types of incentives are normally handled by the state government. You can sell the SRECs you receive to your utility company or other buyers, and the money you receive in return is generally considered part of your taxable income.
- Rebates: Rebates, or cash back after a purchase, are usually given before any solar tax credits are calculated. Rebates might be offered by your local utility company, by your state or by your county.
- Tax Exemptions: Your solar panel system could qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions let you exclude the value that solar panels add when you are calculating property taxes on your home.
Federal Solar Incentives
When you think about solar incentives, you likely think of federal incentives first. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a predetermined percentage of the cost of your solar system.
The ITC applies towards solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, labor, equipment and accessories. This credit can be claimed on a solar panel system installed on a primary or secondary residence in the United States that you own. The original claim amount was 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum amount you can claim.
To better understand how the ITC might apply to you, contact your local Danville solar panel installer and request 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). Homeowners can now receive a credit equal to 30% of the total solar system installation costs for projects started after January 1, 2022 and completed before the end of 2032. The percentage will then begin to decrease yearly until the Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to get credits for energy storage systems under this new program.
More information about the new Inflation Reduction Act can be found here. Your local Danville solar panel installation experts can answer your questions and explain how the new Clean Energy Credit will apply to you.
State & Local Solar Incentives
There are often also state solar incentives in addition to those provided by the federal government. Tax credits, rebates and more can be offered at a more local level. Some incentives are ongoing, while others are only available for a limited time. Incentives may be provided by your county or municipality, or by the California government.
Next Steps for Installing Solar in Danville
You can receive solar incentives from the federal government and the California government, as well as from your local utility company. Growing availability of solar initiatives over the last 15 years has helped greatly increase nationwide adoption of solar energy. Call your local solar panel installation expert today to find out more information and to save as much money as possible on solar panels for your Danville home.
EcoWatch's Danville, CA Solar Incentives FAQs
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