2023 Solar Incentives Guide for Elk Grove, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Elk Grove.
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.
Get a free quote from one of our trusted Elk Grove solar installers to see how much you can save.
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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Elk Grove?
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
Renewable Market Adjusting Tariff (ReMAT)
LADWP - Feed-in Tariff (FiT) Program
Base price will step down over time as certain MW goals are met
SMUD - PV Residential Retrofit Buy-Down
Federal Residential Renewable Energy Tax Credit
The term "solar incentives" includes a wide range of financial incentives designed to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Different types of incentives, such as discounts, cash back or credit towards your monthly utility bill, might be available to you. Some incentives may be offered by the state of California, by your utility company or by county or municipality, while others are federal. Some broad categories of solar incentives include:
- Rebates: A solar rebate is a partial refund after the purchase of your solar system. Rebates may be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
- Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you have a net metering agreement with your Elk Grove utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some places, this credit is dollar-for-dollar, while in other places you may make back a percentage of the value.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
- Tax Exemptions: Tax exemptions may come in one of two forms. The first is sales tax exemption, which is applied at the time you purchase your solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when calculating property tax for your house.
- Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that is generally considered part of your taxable income. Typically, there is a small threshold of energy production to meet before your solar system is eligible for SRECs or other performance-based incentives. Incentives like these are generally handled at the state level.
Federal Solar Incentives
When you think about solar incentives, you probably 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 provides a credit on your taxes equal to a certain percentage of your solar system's cost.
The ITC can be applied to the total cost of solar system installation, including the panels themselves as well as equipment, labor and accessories. You can claim this credit 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.
Talking to your local Elk Grove solar panel installer is the best way to understand how the ITC could apply to you.
The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as renaming it to the Clean Energy Credit). The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. At this point, the percentage will be reduced slightly each year until the end of the program in 2035. Beginning in 2023, it will also be easier to get credits for energy storage systems under the new laws.
Click here to learn more about the new Inflation Reduction Act. Your local Elk Grove solar panel company can answer any questions you have and explain how the new Clean Energy Credit applies to you.
State & Local Solar Incentives
Tax credits, rebates and more can be claimed at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. Incentives may be handled by your county or municipality, or by the state of California. Some incentives might only be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Elk Grove
Solar incentives might be provided by the California government, the federal government or your local utility company. The growing number of incentives available has contributed to a large increase in solar energy use in the last 15 years. If you're prepared to make the switch to solar energy, talking to your local Elk Grove solar panel installation expert is an excellent place to start.
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- Industry-leading warranty coverage
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EcoWatch's Elk Grove, CA Solar Incentives FAQs
What if I add a solar system to a vacation home, rental property or commercial property? Do I still qualify for incentives?
While we recommend getting in touch with your local solar installer and/or tax professional to better understand what solar incentives apply to you, many apply to a second home, so long as that home is in the United States and owned by you. There may be other incentives available specifically for commercial properties, depending on the specifics.
How much will solar panels save me annually on my electric bill in Elk Grove?
After adding solar panels to your house in Elk Grove, you can anticipate savings of approximately $1,334.57 per year, or approximately $25,356.75 over the next 20 years.
Who installs solar panel systems near me?
To find a top-rated solar panel installer, check out our guide to Elk Grove's best solar panel companies.
Can I claim incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can claim both tax credits and rebates towards the cost of your solar panels. Depending on which incentives you are applying for, they may apply in a different order. Be sure to speak with your solar installer or a local tax professional to ensure that you are claiming incentives correctly and getting the most money you can.
Can I use a combination of multiple types of renewable energy to power my home?
Yes, you can utilize multiple types of renewable energy to power your home, such as a combination of solar and geothermal. You can also use both renewable energy sources and a non-renewable backup source of energy. Make sure that you discuss your plan with your local Elk Grove solar panel installer, so that you understand what you'll need and what incentives you might or might 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.