2023 Solar Incentives Guide for Fountain Valley, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Fountain Valley.
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 March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Fountain Valley?
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/
Solar incentives mitigate the cost of installing solar panels on your home. This category of financial incentives is designed to encourage more Americans to switch to renewable energy. Different kinds of incentives, including discounts, cash back or credit towards your monthly utility bill, might be available to you. Certain incentives may be provided via the state of California, by your utility company or by county or municipality, while others are federal. Some broad categories of solar incentives include:
- Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives might be available to you if you have a solar system that produces more than a specified (typically small) amount of electricity. This category of incentives is typically handled at the state level. You can sell your SRECs to your utility company or other buyers, and the money you make is normally considered part of your taxable income.
- Net Metering: Net metering factors in once your solar system is up and running. If you have a net metering agreement in place with your Fountain Valley utility company, the company 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 make back a percentage of the value.
- Rebates: Solar rebates can be provided by your state or county, or by your local utility company. These rebates work as partial refunds that are applied after you purchase a solar system and before tax credits are calculated.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the government.
- Tax Exemptions: Your solar system might 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 you are calculating property taxes on your home.
Federal Solar Incentives
Federal solar incentives are likely to be the first thing that comes to mind when thinking about solar incentives. One of the incentives many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a specific percentage of the cost of your solar system.
The ITC applies to the total cost of solar panel installation, including the panels themselves as well as accessories, labor and equipment. You can claim this credit for panels installed after January 1, 2006 on a primary or secondary residence located in the United States that you own. 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 amount you can claim.
To more fully understand how the ITC may apply to your situation, speak to your local Fountain Valley solar panel installer and ask for more information.
In August 2022, the Inflation Reduction Act expanded and extended the ITC, now referred to as the Clean Energy Credit. Homeowners can now qualify for a credit of 30% of the total costs of solar system installation for projects started after January 1, 2022 and completed before the end of 2032. This percentage will then decrease annually until the Clean Energy Credit ends in 2035. The expansion also makes it easier to get credit for energy storage systems, beginning in 2023.
Click here to learn more about the new Inflation Reduction Act. The best way to learn more about how the new Clean Energy Credit will apply to you is to reach out to your local Fountain Valley solar panel company with your questions.
State & Local Solar Incentives
Some solar incentives are often also offered at the local or state level. Similar to federal incentives, these could include tax credits, rebates and more. Incentives might be offered by your county or municipality, or by the state of California. Certain incentives might only be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Fountain Valley
The expanding number of solar incentives available has enormously increased the adoption of solar energy nationwide over the last 15 years. You may receive solar incentives from the California government, the federal government or your local utility company. Contact your local solar panel installer today to discover more about the various programs and to save as much money as possible on solar panels for your Fountain Valley home.
Best Regional Coverage
Momentum Solar
- Great warranty coverage
- Representatives are experts on local policies
- Concierge service ensures steady communication
- Slightly limited service offerings
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
EcoWatch's Fountain Valley, CA Solar Incentives FAQs
What if I want to add a solar system to a vacation home, rental property or commercial property? Will I still qualify for incentives?
Many solar incentives are intended to apply to a property located within the United States that you own, and most secondary residences will fall under this distinction. Other solar incentives may be available for commercial properties, depending on the specifics. We recommend speaking with your local solar installer and/or tax professional to fully understand what incentives apply to your specific situation.
If I already have solar panels, can I still claim incentives?
An excellent idea would be to talk to someone from the company that installed your solar system — or get in touch with a local Fountain Valley solar installer — to clarify 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. Solar panels installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
What are the environmental benefits of switching to solar?
You can reduce your carbon footprint by 250 pounds of CO2 annually by switching to solar panels. This adds up to approximately 5,000 pounds over 20 years. In addition, solar power is a renewable energy source, meaning that switching your home over lessens the drain on our planet's resources.
When does the federal solar tax credit end?
The Clean Energy Credit (formerly named the federal solar tax credit, or the ITC), is slated to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I use a combination of multiple types of renewable energy to power my home?
Yes, you can employ multiple types of renewable energy to power your home, such as a combination of geothermal and solar. You can also combine renewable energy generation with a non-renewable backup source of energy. Be sure to discuss your plan with your local Fountain Valley solar installation expert, to make sure you know what you'll need and what types of 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.