2023 Solar Incentives Guide for La Palma, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in La Palma.
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 La Palma?
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 are designed to make renewable energy usage more affordable via financial incentives for individuals who install solar panels on their homes. Different types of incentives, such as cash back, discounts or credit towards your monthly utility bill, may 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. You might qualify for any of the following types of solar incentives:
- Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you've signed a net metering agreement with your La Palma 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 areas you may receive a refund equivalent to a percentage of the value.
- Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce more than a specified (generally small) amount of electricity will qualify for SRECs or similar performance-based incentives. SRECs and performance-based incentives in general are typically provided by your state government. When you receive an SREC, you can sell it to your utility company or another buyer, and this is usually considered part of your taxable income.
- Rebates: A rebate is a partial refund credited to your account after you've paid for your solar system. These might 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 calculating tax credits.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
- Tax Exemptions: Your solar panels could qualify for both sales tax and property tax exemptions. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions allow you to exclude the added value of the solar panels when you are calculating property taxes on your house.
Federal Solar Incentives
When someone says "solar incentives," you probably think of federal incentives first. You may have heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit equal to a specified percentage of the money you spend installing solar panels.
The ITC can be applied to solar systems installed after January 1, 2006 on a primary or secondary residence that you own in the United States. Initially, the credit applied to 30% of the total cost — for panels, equipment, accessories and labor — although it may range from 26-30%, depending on when your solar system was installed. There is no cap on the amount you can claim.
To find out exactly how much money the ITC could save you, get in touch with your local La Palma solar panel installer.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now called the Clean Energy Credit. For solar systems installed between January 1, 2022 and December 31, 2032, homeowners may be eligible for a credit equal to 30% of the total cost. The percentage will then decrease annually until the Clean Energy Credit ends in 2035. Starting in 2023, it will also be easier to obtain credits for energy storage systems under the new laws.
More information about the new Inflation Reduction Act can be found here. The easiest way to understand how the new Clean Energy Credit might apply to you is to reach out to your local La Palma solar panel installation expert with your questions.
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. Incentives might be handled by the state of California, or by your county or municipality. Certain incentives may be available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in La Palma
You can apply for and receive solar incentives from the federal government and the California government, as well as from your local utility company. Growing availability of solar initiatives in the past 15 years has helped greatly increase nationwide adoption of solar energy. When you're prepared to make the change to solar energy, reaching out to your local La Palma solar panel installation expert is a great first step.
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 La Palma, CA Solar Incentives FAQs
What if I want to add solar panels to a rental property, vacation home or commercial property? Do I still qualify for incentives?
While we recommend getting in touch with your local solar installer and/or tax professional to best understand what solar incentives apply to you, many incentives can be claimed on a second home, as long as it is in the United States and owned by you. There may be additional incentives available specifically for commercial properties, depending on the specifics.
How can I find out if I qualify for specific solar incentives?
It's best to speak with your local La Palma solar installer to get an understanding of which incentives your project may qualify for. Usually, solar incentives apply to new solar panel systems installed on a property you own (in the U.S.) between the dates specified by the incentive. Some incentives, such as those given by the state of California, might have other requirements.
I already have solar panels. Are there any incentives that I qualify for?
Your best bet is to talk to someone from the company that installed your system — or call a local La Palma 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 recently increased 30% tax credit under the Inflation Reduction Act. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
How long until the federal solar tax credit ends?
The federal solar tax credit, previously called the ITC and now titled the Clean Energy Credit, is scheduled 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 utilize solar energy, are there any credits I can claim?
Under the new Inflation Reduction Act, there are a number of new financial incentives to encourage you to make eco-friendly improvements to your home. More details regarding these incentives, including information about incentives for purchasing new appliances, can be found here.
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.