2023 Solar Incentives Guide for Farmersville, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Farmersville.
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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Updated September 15, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Farmersville?
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
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/
The term "solar incentives" covers 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. Incentives might include things like discounts, cash back or monthly utility bill credits. Some incentives are provided by the federal government, while others are handled by the state of California or your specific utility company, county or municipality. Some broad categories of solar incentives include:
- Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives may be available to you if you have a solar system that produces over a specified (generally small) amount of electricity. Performance-based incentives are generally handled at the state level. You can sell the SRECs you receive to your utility company or other buyers, and the money you make is generally considered part of your taxable income.
- Net Metering: Net metering becomes relevant once your solar system is up and running. If you have a net metering agreement with your Farmersville utility company, it will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some locations, this is a dollar-for-dollar credit, while in others you might get refunded 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.
- Rebates: Rebates, or partial refunds after a purchase, are normally given before any solar tax credits are calculated. These rebates may be provided by your local utility company, by your state or by your county.
- Tax Exemptions: Tax exemptions can come in two forms. First, there is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption. This allows you to ignore the added value of your solar system when paying property tax on your home.
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Momentum Solar
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Federal Solar Incentives
Federal solar incentives are likely to be the first thing that you think of when you think about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is likely the most commonly known federal solar incentive. The ITC allows you to claim a tax credit for a specific percentage of the cost of your solar system.
The ITC covers solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, equipment, labor and accessories. This credit can apply towards a solar panel system installed on a primary or secondary residence in the United States that you own. Originally, you could claim 30% of the total cost, although certain projects may qualify for only 26%, depending on the details. There is no maximum claim amount.
To better understand how the ITC will apply to your situation, get in touch with your local Farmersville solar panel installer and ask for more information.
In August 2022, the ITC (now referred to as the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. The Clean Energy Credit is valid until 2035. Any solar installation project that is completed between January 1, 2022 and December 31, 2032 may qualify for a 30% tax credit; this amount will be decreased slightly on a yearly basis until the end of the current program. Starting in 2023, it will also be easier to get credits for energy storage systems under the new laws.
More information about the new Inflation Reduction Act can be found here. Your local Farmersville solar panel installer can answer any questions you have and explain how the new Clean Energy Credit will apply to you.
State & Local Solar Incentives
Some solar incentives may be provided at the state and local level. Like with federal incentives, these may include tax credits, rebates and more. These incentives — which may be given by the state of California, or by your county or municipality — may be offered on an ongoing basis, or for only a limited time.
Next Steps for Installing Solar in Farmersville
Solar energy use nationwide has gone up tremendously in the past 15 years, in part due to the growth in the number of solar incentives. You can obtain these incentives from your local utility company, the federal government or the California government. When you're ready to make the switch to solar energy, talking to your local Farmersville solar panel installation expert is an excellent place to start.
EcoWatch's Farmersville, CA Solar Incentives FAQs
If I already have a solar system installed on my house, 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 year it was installed. Reaching out to the company that installed your system, or any local Farmersville solar installer, can help you understand what incentives you qualify for.
What are some environmental benefits of installing solar panels on my home?
You can decrease your carbon footprint by 250 pounds of CO2 a year when you switch to solar panels. This adds up to roughly 5,000 pounds in 20 years. In addition, solar power is a renewable energy source, meaning that making the switch lessens the drain on our planet's resources.
How long until the federal solar tax credit ends?
The federal solar tax credit, previously called the ITC and now called the Clean Energy Credit, is slated 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.
If I switch my appliances out for ones that can utilize solar energy, are there any benefits I can claim?
The recently passed Inflation Reduction Act includes provisions for several incentives meant to reward homeowners who make eco-friendly upgrades. Some incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
Can I receive incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can claim both rebates and tax credits towards the cost of solar panels. Depending on which incentives you are receiving, they may apply in a different order. Make sure that you speak with your solar installer or a local tax professional to verify that you are claiming incentives correctly and getting the most money you can.
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.