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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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
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
Solar incentives mitigate the cost of installing a solar panel system on your home. Financial incentives like these are intended to encourage more Americans to switch their home over to renewable energy. Solar incentives could include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are offered by the federal government, some by the California government and some by your utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- 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.
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
- Net Metering: Don't forget to talk with your La Palma utility company about signing a net metering contract. This will allow you to receive credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You may receive either a dollar-for-dollar credit or a percentage of the value.
- Tax Exemptions: Your solar system might qualify for both sales tax and property tax exemptions. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions let you ignore the value added by your solar panels when calculating property taxes on your home.
- Rebates: Solar rebates might be offered by your county or state, or by your local utility company. These rebates are essentially cash back that is applied after you pay for solar panels and before tax credits are calculated.
Federal Solar Incentives
Federal solar incentives are likely the first thing that you think of when thinking about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is likely the most well-known federal solar incentive. The ITC offers a tax credit for a predetermined percentage of the cost of your solar system.
The ITC covers solar systems installed after January 1, 2006 and allows you to deduct from your taxes a percentage of the total cost of solar panels, accessories, equipment and labor. This credit can apply towards a solar panel system installed on a primary or secondary residence that you own in the United States. Originally, you could claim 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum claim amount.
Have questions about how the ITC applies to your specific situation? Contact your local La Palma solar panel installation expert to get more information.
In August 2022, the ITC (now called the Clean Energy Credit) was expanded and extended by the passage of the Inflation Reduction Act. The new Clean Energy Credit now runs until 2035. American homeowners can now receive a 30% credit for solar systems installed between 2022 and 2032. This new credit will then see a slight annual decrease until its expiration. The program expansion also makes claiming credit for energy storage systems easier than ever before, starting in 2023.
Click here to learn more about the new Inflation Reduction Act. Your local La Palma solar panel installation expert is the best person to answer your questions regarding the new Clean Energy Credit and how it applies to you.
State & Local Solar Incentives
There are more than just federal solar incentives; tax credits, rebates and more may be offered at the local or state level. The incentives — which may be handled by your county or municipality, or by the state of California — might be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in La Palma
The expanding number of available solar incentives has helped tremendously increase the use of solar power nationwide over the last 15 years. You can get solar incentives from the federal government, the California government or from your local utility company. Reach out to your local solar panel installer today to find out more information and to save as much money as possible on solar panels for your La Palma home.
EcoWatch's La Palma, CA Solar Incentives FAQs
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