2023 Solar Incentives Guide for Los Alamitos, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Los Alamitos.
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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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Los Alamitos?
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 help mitigate the cost of installing solar panels on your home. This category of financial incentives is designed to encourage more homeowners to make the switch to renewable energy. These incentives could include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are provided by the federal government, some by the state of California and some by your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Rebates: Rebates, or cash back after a purchase, are normally applied before any solar tax credits are calculated. These rebates might be offered by your local utility company, by your county or by your state.
- Tax Exemptions: Sales tax exemptions are applied at the point of sale for your solar system. Property tax exemptions allow you to exclude the added value of your solar system when calculating the amount of property tax you need to pay.
- Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives may be available to you if your solar system produces over a specified (generally small) amount of electricity. This category of incentives is normally handled at the state level. You can sell any SRECs you have to your utility company or other buyers, and the money you make is usually considered part of your taxable income.
- Net Metering: Net metering factors in after your solar panels are up and running. If you have in place a net metering agreement with your Los Alamitos utility company, the company will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some areas, this is a dollar-for-dollar credit, while in others you might make back a percentage of the value.
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
Federal Solar Incentives
When you hear the term "solar incentives," federal incentives are likely the first thing that comes to mind. A federal incentive that most people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a specific percentage of your solar system's cost.
The ITC applies to the value of solar panels installed on your primary or secondary residence in the United States. The solar system must have been installed after January 1, 2006 on a property owned by you for you to claim the credit. The ITC originally paid out 30% of all system costs (panels, accessories, equipment and labor), although the covered amount has fluctuated over time between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the claim amount.
To more fully understand how the ITC might apply to your situation, reach out to your local Los Alamitos solar panel installer and ask for more information.
The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as renaming it to the Clean Energy Credit). The Clean Energy Credit is valid until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit; the amount will decrease slightly on a yearly basis until the end of the current program. Starting in 2023, the expansion to the program will also make claiming credit for energy storage systems easier than ever before.
More information about the new Inflation Reduction Act can be found here. Your local Los Alamitos solar panel installer can answer any questions you have and explain how the new Clean Energy Credit will apply to you.
State & Local Solar Incentives
Some solar incentives may be offered at the local or state level. As with federal incentives, these might include rebates, tax credits and more. Certain incentives are ongoing, while others may only be available for a limited time. Incentives might be given by your county or municipality, or by the California government.
Next Steps for Installing Solar in Los Alamitos
Solar incentives can come from the federal government, the California government or your local utility company. The growing number of available solar incentives has facilitated the nationwide growth of solar energy use in the last 15 years. Reach out to your local solar panel installer today to discover more about the various programs and to save the most money possible on solar panels for your Los Alamitos home.
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EcoWatch's Los Alamitos, CA Solar Incentives FAQs
What are the highest-rated solar panel installation companies near me?
To discover the top solar panel installation companies near you, read our article on Los Alamitos' top solar panel companies.
What are some of the environmental benefits of switching to solar energy?
Solar energy is a renewable energy source — by changing where you get your energy, you can help lessen the strain on our planet's resources. You can also reduce your home's CO2 emissions by 250 pounds yearly, or roughly 5,000 pounds over 20 years.
How long until the federal solar tax credit ends?
The federal solar tax credit, formerly known as the ITC and now titled the Clean Energy Credit, is set to end January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
Can I receive incentives both towards the initial cost of solar panels, and later as reimbursement?
The order your incentives will be applied in might vary depending on which incentives you receive but in most cases yes, you can receive multiple types of incentives for your solar project. Talk with your solar installer or a local tax professional to ensure you are claiming all the incentives you are eligible for and applying them in the correct order.
Can I use solar and another type of renewable energy in combination to power my home?
Yes, you can employ multiple types of renewable energy to power your home — for example, a combination of wind and solar. You can also use both renewable energy sources and a non-renewable backup source of energy. Be sure to discuss your plan with your local Los Alamitos solar panel installer, to get an understanding of what will be needed and what kinds of incentives you will or won't 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.