2024 Solar Incentives Guide for Folsom, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Folsom.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Folsom?
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 propertyThe 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
SMUD - PV Residential Retrofit Buy-Down
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
The phrase "solar incentives" refers broadly to financial incentives that are in place to encourage the use of renewable energy by making the installation and use of solar panels more affordable. Various kinds of incentives, such as discounts, cash back or monthly utility bill credits, might be available to you. Some incentives may be handled by the California government, by your utility company or by county or municipality, while other incentives are federal. Some broad categories of solar incentives include:
- Tax Credits: Tax credits reduce, dollar-for-dollar, the total amount of tax you owe the government. Tax credits are different from tax deductions.
- Rebates: Your solar installer might help you claim a rebate, or partial refund after purchase, for your solar panels. States or counties will also sometimes offer limited-time rebates. The value of a rebate will usually be deducted from your total price before tax credits are calculated.
- Net Metering: Net metering is an incentive you can get once your solar system is up and running. If you have a net metering agreement with your Folsom utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this is a dollar-for-dollar credit, while in other places you may receive a refund equivalent to a percentage of the value.
- Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for money that typically becomes part of your taxable income. Typically, there is a small threshold of energy production to meet before your solar system can earn SRECs or other performance-based incentives. These kinds of incentives are generally handled by your state government.
- Tax Exemptions: Sales tax exemptions are effective at the point of sale for your solar system. Property tax exemptions allow you to exclude the value added by your solar system when you're calculating how much property tax you need to pay on your house.
Best National Provider
SunPower
- Most efficient panels on the market
- National coverage
- Cradle to Cradle sustainability certification
- Great warranty coverage
- Expensive
- Customer service varies by local dealer
Best Regional Coverage
Momentum Solar
- Great warranty coverage
- Representatives are experts on local policies
- Concierge service ensures steady communication
- Slightly limited service offerings
Best for Leasing
Sunrun
- Expansive service area
- Many financing options
- Some reported issues with customer service
- Some reported issues with door-to-door sales
Federal Solar Incentives
When thinking about solar incentives, you probably think of federal incentives first. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit equal to a specified percentage of the money you spend on your solar system.
The ITC initially applied to 30% of the cost of installing solar panels, although that number has fluctuated slightly over the years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total cost of installation includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum claim amount. The ITC applies to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.
Curious how the ITC might apply to your specific situation? Contact your local Folsom solar panel installer 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). The Clean Energy Credit lasts until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit. The amount will decrease slightly on a yearly basis until the end of the current program. Beginning in 2023, it will also be easier to qualify for credits for energy storage systems under this new program.
More information about the new Inflation Reduction Act can be found here. The best way to understand how the new Clean Energy Credit might apply to you is to speak with your local Folsom solar panel installers directly.
State & Local Solar Incentives
Rebates, tax credits and more can be claimed at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. Some incentives are ongoing, while others are available for a limited time. They might be offered by the California government, or by your county or municipality.
Next Steps for Installing Solar in Folsom
Nationwide solar energy use has significantly increased in the past 15 years, in part thanks to the increase in availability of solar incentives. You can obtain these incentives from your local utility company, the federal government or the California government. Your local Folsom solar panel installer can give you more information about which incentives you should apply for, and get you feeling good about making the change to renewable energy today.
EcoWatch's Folsom, CA Solar Incentives FAQs
I already have solar panels installed. Are there any incentives that I qualify for?
Your best bet is to talk to a representative from the company that installed your solar system – or get in touch with a local Folsom solar installer — to learn about which incentives you might 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. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
What are the top solar panel installation companies near me?
To find the right solar panel installer for you, check out our guide to the best solar companies in Folsom.
How long until the federal solar tax credit ends?
The Clean Energy Credit (previously referred to as the federal solar tax credit, or ITC), currently ends on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I claim incentives both towards the initial cost of solar panels, and later as reimbursement?
The order that incentives will be applied in might vary depending on which incentives you are claiming but usually yes, you can claim multiple types of incentives for your solar project. Speak to your solar installer or a local tax professional to be sure you are claiming all the incentives you qualify for 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.