2023 Solar Incentives Guide for Lakewood, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Lakewood.
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 Lakewood?
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 intended to make renewable energy usage more affordable via financial incentives to help people install solar panels on their homes. You may be eligible for various types of incentives, including cash back, discounts or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of California and others from the federal government. Some solar incentives you might qualify for are:
- Tax Exemptions: Sales tax exemptions go into effect at the point of sale for your solar system. Property tax exemptions allow you to ignore the value that your solar panels add when calculating the amount of property tax you need to pay on your home.
- Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives might be available to you if you have a solar system that produces more than a specified (usually small) amount of electricity. This category of incentives is normally handled at the state level. You can sell 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 becomes relevant after your solar system is up and running. If you have a net metering agreement with your Lakewood utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this is a dollar-for-dollar credit, while in others you may be refunded a percentage of the value.
- Rebates: Rebates, or partial refunds after a purchase, are usually applied prior to any solar tax credits being calculated. Solar rebates can be provided by your local utility company, by your state or by your county.
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
Federal Solar Incentives
Federal solar incentives are likely to be the first thing that you think of when you think about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is the most commonly known federal solar incentive. The ITC provides you with a tax credit for a predetermined percentage of your solar system's cost.
The ITC covers solar systems installed after January 1, 2006 and under this program you can deduct from your taxes a percentage of the total cost of solar panels, accessories, labor and equipment. This credit can apply towards solar panels installed on a primary or secondary residence in the United States that you own. The original amount you could claim was 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.
To more fully understand how the ITC may apply to your situation, call your local Lakewood solar panel installer and ask for more information.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). The Clean Energy Credit has increased the current credit up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. At this point, the credit percentage will see a slight decrease annually until the end of the program in 2035. The expansion to the program also makes credits for energy storage systems even easier to claim, starting in 2023.
More information about the new Inflation Reduction Act can be found here. The best way to understand how the new Clean Energy Credit applies to you is to reach out to your local Lakewood solar panel installers with your questions.
State & Local Solar Incentives
Some solar incentives may be provided at the state and local level. As with federal incentives, these could include rebates, tax credits and more. Certain incentives are ongoing, while others may only be available for a limited time. They may be provided by the California government, or by your county or municipality.
Next Steps for Installing Solar in Lakewood
Nationwide solar energy use has gone up tremendously in the past 15 years, in part due to the growth in the number of solar incentives. You can obtain these incentives from the federal government, the California government or your local utility company. Reaching out to your local Lakewood solar panel installation expert is an excellent first step towards making sure you get all the incentives you qualify for when you switch to solar energy.
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 Lakewood, CA Solar Incentives FAQs
What if I add solar panels to a vacation home, rental property or commercial property? Can I still qualify for incentives?
While we recommend talking to your local solar installer and/or tax professional to better understand what solar incentives apply to you, many can be claimed on a second home, provided that it is in the United States and owned by you. There may be additional incentives available for commercial properties specifically, depending on the details.
What are the top solar panel installation companies near me?
To find the right solar panel installer for you, check out our guide to Lakewood's best solar panel companies.
How long until the federal solar tax credit ends?
The Clean Energy Credit (previously called the federal solar tax credit, or ITC), currently ends on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I claim incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order your incentives will be applied in could vary depending on which incentives you are claiming but typically yes, you can claim multiple types of incentives for your solar project. Speak to your solar installer or a local tax professional to confirm you are claiming all the incentives you are eligible for and applying them in the correct order.
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 — for example, a combination of solar and geothermal. You can also use both renewable energy sources and a backup source of non-renewable energy. Make sure that you discuss the details of your plan with your local Lakewood solar panel installer, to get an understanding of what will be needed and what types of incentives you may or may 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.