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
Solar installers are experts in maximizing your solar tax credits and rebates.
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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
Why you can trust EcoWatch
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 meant to encourage homeowners to make the switch to renewable energy by providing financial incentives meant to lower the burden of solar panel installation and use. These 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 state of California and some by your utility company, county or municipality. Some broad categories of solar incentives 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 added value of your solar system when you're calculating how much property tax you need to pay.
- Net Metering: Net metering factors in after your solar system is up and running. If you've signed a net metering agreement with your Danville utility company, it will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some locations, this credit is dollar-for-dollar, while in others you may get refunded a percentage of the value.
- Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives may be available to you if the solar system on your home produces over a specified (generally small) amount of electricity. Performance-based incentives are normally handled at the state level. You can sell SRECs to your utility company or other buyers, and the money you receive in return is normally considered part of your taxable income.
- Rebates: Rebates, or partial refunds after a purchase, are usually given prior to any solar tax credits being calculated. Rebates might be provided by your local utility company, by your state or by your county.
- Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the federal government. (A tax credit is different from a tax deduction.)
Federal Solar Incentives
When thinking about solar incentives, you probably think of federal incentives first. You may have heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit equal to a predetermined percentage of the money you spend installing solar panels.
The ITC can be applied to solar systems installed after January 1, 2006 on a primary or secondary residence in the United States that you own. Initially, the credit applied to 30% of the total cost — for panels, equipment, labor and accessories — although the percentage may range from 26-30%, depending on when your solar system was installed. There is no cap on the amount you can claim.
Have questions about how the ITC applies to your specific situation? Reach out to your local Danville solar panel installation expert to get more information.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). For solar systems installed between January 1, 2022 and December 31, 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 expires in 2035. The program expansion also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.
Click here to learn more about the new Inflation Reduction Act. Your local Danville solar panel installers are the best people to answer your questions regarding the new Clean Energy Credit and how it may apply to you.
State & Local Solar Incentives
Rebates, tax credits and more can be claimed at multiple levels. Along with federal solar incentives, there are often state and local ones as well. Certain incentives are ongoing, while others may only be available for a limited time. These incentives may be given 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. The growing availability of solar initiatives in the past 15 years has helped greatly increase nationwide adoption of solar energy. Your local Danville solar panel installation expert can give you more information about which incentives you can apply for, and get you feeling good about making the change to renewable energy today.
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EcoWatch's Danville, CA Solar Incentives FAQs
If I installed solar panels on my house a few years ago, can I still claim incentives?
An excellent idea would be to talk to the company that installed your system — or call a local Danville solar installer — to learn about which incentives you may qualify for. If your system was installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
How much can I save on my electric bill annually if I add solar panels to my Danville home?
Once you add solar panels to your Danville home, you can expect to save around $1,729.84 per year, or around $32,866.94 over 20 years.
What are the highest-rated solar panel installation companies near me?
To find the best solar panel installers near you, take a look at our article on Danville's best solar panel companies.
What are some environmental benefits of adding solar panels to my home?
Solar energy is a renewable energy source — by changing where you get your energy, you can help reduce the strain on our planet's resources. Solar panels can also lower your home's CO2 emissions by 250 pounds annually, or around 5,000 pounds over 20 years.
Can I receive incentives both towards the initial cost of solar panels, and later as reimbursement?
The order your incentives will be applied in might vary depending on which incentives you are claiming but typically yes, you can claim multiple types of incentives for your solar project. Speak to your solar installer or a local tax professional to ensure you are claiming all possible incentives and applying them in the correct order.
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.