2023 Solar Incentives Guide for Grand Terrace, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Grand Terrace.
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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What Solar Tax Credits, Incentives, and Rebates are Available in Grand Terrace?
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
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
The phrase "solar incentives" includes a range of financial incentives put in place to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Incentives could include things like discounts, cash back or monthly utility bill credits. Some incentives are provided by the federal government, while others are provided by the state of California or by your utility company, county or municipality. Some broad categories of solar incentives include:
- Solar Renewable Energy Certificate (SREC): In most cases, solar systems that produce over a specific (generally small) amount of electricity qualify for SRECs or other performance-based incentives. SRECs and performance-based incentives in general are typically provided at the state level. SRECs can be sold to your utility company or another buyer, and generally the money you make is normally considered part of your taxable income.
- Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar system. Rebates could be offered by your local utility company, your state or your county. The cash back that you get from the rebates is normally applied before tax credits are calculated.
- Net Metering: Net metering becomes relevant once your solar panels are up and running. If you've signed a net metering agreement with your Grand Terrace utility company, the company 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 be refunded a percentage of the value.
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
- Tax Exemptions: These may come in the form of property tax exemptions, which allow you to exclude the value of your solar system when paying property tax on your house. You could also look for exemptions on sales tax at the time of purchase.
Federal Solar Incentives
When thinking about solar incentives, federal incentives are likely the first thing that comes to mind. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a specified percentage of your solar system's cost.
The ITC applies to solar systems installed after January 1, 2006 on a primary or secondary residence that you own in the United States. Originally, the tax credit was for 30% of the total cost — for panels, equipment, labor and accessories — although that amount may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the claim amount.
To best understand how the ITC may apply to your situation, speak to your local Grand Terrace solar panel installer and request more information.
In August 2022, the ITC (now referred to as the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. Homeowners can now qualify for a credit of 30% of the total costs of solar system installation for projects that began after January 1, 2022 and will be finished by the end of 2032. The credit percentage will then decrease on a yearly basis until the Clean Energy Credit ends in 2035. The expansion also makes it easier to get credit for energy storage systems, starting 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 might apply to you is to talk with your local Grand Terrace solar panel company.
State & Local Solar Incentives
Federal solar incentives are not your only option; rebates, tax credits and more may be offered at the state and local level. Some incentives are offered for only a limited time, while others are ongoing. Your local incentives could come from the California government, or from your specific county or municipality.
Next Steps for Installing Solar in Grand Terrace
Solar incentives might be provided by the federal government, the California government or your local utility company. The large number of available solar incentives has helped nationwide use of solar energy increase greatly in the last 15 years. Reaching out to your local Grand Terrace solar panel installation expert is the best first step towards getting the most money possible when you switch to solar energy.
EcoWatch's Grand Terrace, CA Solar Incentives FAQs
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