2024 Solar Incentives Guide for Gilroy, CA - Tax Credits & Rebates

In this guide, we'll cover the latest solar incentives and rebates available in Gilroy.

You'll learn about:

  • Local & State Solar Incentives
  • Federal Tax Credits (Updated for 2024 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 Gilroy solar installers to see how much you can save.

By EcoWatch Local Advisors

Data Analysis: James Savino

Ranking Methodology: Karsten Neumeister

Updated February 03, 2024

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We work with a panel of solar experts to create unbiased reviews that empower you to make the right choice for your home. No other site has covered renewables as long as us, which means we have more data and insider information than other sites. Our rankings are never affected by revenue or partnerships.

What Solar Tax Credits, Incentives, and Rebates are Available in Gilroy?

Western Riverside Council of Governments - Home Energy Renovation Opportunity (HERO) Financing Program

Incentive Type:
PACE Financing
Eligible products can be financed for up to 25 years, depending on the useful life of the eligible product.
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.

California Solar Initiative - Solar Thermal Program

Incentive Type:
Rebate Program
Step 1 Incentive Rates (contact utility to determine current incentive levels):
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

LADWP - Feed-in Tariff (FiT) Program

Incentive Type:
Feed-in Tariff
$0.17/kWh adjusted by a time of delivery multiplier
Base price will step down over time as certain MW goals are met

Self-Generation Incentive Program

Incentive Type:
Rebate Program
For projects 30 kW or larger, 50% of incentive will be received up-front; 50% will be received based on actual kWh production over the first 5 years. For projects under 30kW, 100% of the incentive will be paid up front.
Incentives will step down over time. See below for incentive amounts.

Property Tax Exclusion for Solar Energy Systems and Solar Plus Storage System

Incentive Type:
Property Tax Incentive
100% of system value; 75% of system value exemption for dual-use equipment

Local Option - Municipal Energy Districts

Incentive Type:
PACE Financing
Locally determined

Renewable Market Adjusting Tariff (ReMAT)

Incentive Type:
Feed-in Tariff

Federal Residential Renewable Energy Tax Credit

Incentive Type:
Personal Tax Credit
30% federal tax credit for systems placed in service after 12/31/2021 and before 01/01/2033. Good for: solar water heat, solar photovoltaics, biomass, geothermal heat pumps, wind (small), fuel cells using renewable fuels.

Source: https://www.dsireusa.org/


The phrase "solar incentives" refers to a 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. Various types of incentives, like discounts, cash back or credit towards your monthly utility bill, may be available to you. Some incentives may be provided via the state of California, by your utility company or by county or municipality, while others are federal. Categories of solar incentives include:

  • Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar panels. These could 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 calculating tax credits.
  • Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
  • Net Metering: Net metering factors in after your solar system is up and running. If you have a net metering agreement with your Gilroy 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 other places you may make back a percentage of the value.
  • Tax Exemptions: Sales tax exemptions are applied at the time of purchase for your solar system. Property tax exemptions let you ignore the value added by your solar system when you're calculating the amount of property tax you need to pay on your house.
  • Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that normally counts as part of your taxable income. Typically, there is a small threshold of energy production to meet before your solar system qualifies for SRECs or similar performance-based incentives. These kinds of incentives are normally handled by your state government.

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Federal Solar Incentives

When thinking about solar incentives, federal incentives are likely the first thing that comes to mind. A federal incentive many people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a specified percentage of your solar system's cost.

The ITC was originally for 30% of the cost of installing a solar system, and has fluctuated slightly over time between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total installation cost includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum amount you can claim. The ITC can be applied to solar systems installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.

To more fully understand how the ITC may apply to you, contact your local Gilroy solar panel installation expert and ask for more information.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now called the Clean Energy Credit. For solar system installations that begin after January 1, 2022, and are completed by the end of 2032, homeowners may be eligible for a credit for 30% of the total cost. After 2033, the percentage will decrease annually until the Clean Energy Credit expires in 2035. The program expansion also makes credits for energy storage systems even easier to claim, starting in 2023.

Click here to learn more about the new Inflation Reduction Act. To better understand how the new Clean Energy Credit applies to you, reach out to your local Gilroy solar installation company.

State & Local Solar Incentives

Not all solar incentives are federal; tax credits, rebates and more might also be offered at the local or state level. These incentives — which might be handled by the state of California, or by your county or municipality — might be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Gilroy

The nationwide use of solar energy has increased enormously in the past 15 years, in part due to the proliferation of solar incentives. You may get these incentives from your local utility company, the California government or the federal government. When you're prepared to make the switch to solar energy, calling your local Gilroy solar panel installation expert is a great first step.

EcoWatch's Gilroy, CA Solar Incentives FAQs

I already have solar panels. Do I qualify for any incentives?

If your solar system was 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 may qualify for a tax credit between 26% and 30%, depending on the exact installation date. Speaking with a representative from the company that installed your solar system, or any local Gilroy solar installer, can help you learn what incentives you can apply for.

Who installs solar panel systems near me?

To discover the best solar panel installation companies near you, read our article on Gilroy's top solar panel companies.

What are some environmental benefits of installing solar panels on my home?

You can reduce your carbon footprint by 250 pounds of CO2 a year when you switch to solar panels. This adds up to around 5,000 pounds over 20 years. In addition, solar power is a renewable energy source, which means that making the switch reduces the drain on our planet's resources.

Can I use both solar and another type of renewable energy to power my home?

You can use multiple types of renewable energy, or a combination of renewable and non-renewable energy, to power your home. Be sure to discuss your ideas with your local Gilroy solar installer. They can help you as you plan for your project and also help you understand the various incentives that you may or may not qualify for.

What if I want to add a solar system to a vacation home, rental property or commercial property? Can I still qualify for incentives?

Many solar incentives apply to a property located within the United States that you own, and most secondary residences will fall under this distinction. There may be other solar incentives available for commercial properties, depending on the details. We recommend getting in touch with your local solar installer and/or tax professional to best understand what incentives may apply to your specific situation.

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.

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