2023 Solar Incentives Guide for East Los Angeles, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in East Los Angeles.
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 East Los Angeles?
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 intended to encourage people to switch to renewable energy by providing financial incentives meant to lower the burden of solar panel installation and use. The incentives could include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are provided by the federal government, some by the California government and some by your specific utility company, county or municipality. Some solar incentives you might qualify for are:
- Rebates: Rebates, or partial refunds after a purchase, are normally applied before any solar tax credits are calculated. These rebates might be given by your local utility company, by your county or by your state.
- Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce over a specific (generally small) amount of electricity will qualify for SRECs or similar performance-based incentives. SRECs and the like are typically offered by your state government. You can sell SRECs to your utility company or another buyer, and this is usually considered part of your taxable income.
- Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the federal government.
- Tax Exemptions: Your solar panel system could 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 calculating property taxes on your house.
- Net Metering: Make sure you talk with your East Los Angeles utility company about signing a net metering agreement. This will allow you to receive credit towards your utility bill every month for the value of excess energy your solar panels generate. You could receive either a dollar-for-dollar credit or a percentage of the value.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some knowledge of. The Federal Solar Investment Tax Credit, or ITC, is the most commonly known federal solar incentive. The ITC provides you with a tax credit for a specific percentage of your solar system's cost.
The ITC applies to the total cost of installing solar panels, including the panels themselves as well as accessories, equipment and labor. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence that you own, as long as it 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 exactly how much money the ITC could save you, speak with your local East Los Angeles solar panel installer.
In August 2022, the ITC (now titled the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. Homeowners can now receive a credit of 30% of the total solar system installation costs for projects that began after January 1, 2022 and will be finished by the end of 2032. The percentage will then decrease yearly until the Clean Energy Credit expires in 2035. The expansion also makes claiming credit for energy storage systems easier than ever before, starting in 2023.
More information about the new Inflation Reduction Act can be found here. The best way to understand how the new Clean Energy Credit applies to you is to get in touch with your local East Los Angeles solar panel installation expert.
State & Local Solar Incentives
In addition to federal solar incentives, there are often also state ones. Rebates, tax credits and more might be available at a more local level. Certain incentives are ongoing, while others may only be available for a limited time. Incentives may be offered by your county or municipality, or by the California government.
Next Steps for Installing Solar in East Los Angeles
You can apply for and receive solar incentives from the California government and the federal government, as well as from your local utility company. The increased availability of solar initiatives in the past 15 years has helped greatly increase nationwide adoption of solar energy. Your local East Los Angeles solar panel installation expert can provide you with more details about which incentives you should apply for, and get you on track to switch to renewable energy today.
EcoWatch's East Los Angeles, CA Solar Incentives FAQs
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