Los Angeles Solar Incentives, Tax Credits And Other Rebates [2022 Updated]

In this EcoWatch guide on Los Angeles solar tax credits and incentives you’ll learn about:

  • Specific solar credits for Los Angeles residents
  • The federal solar Investment Tax Credit (ITC) for Los Angeles residents
  • Net energy metering policies in Los Angeles
  • Additional city and federal rebates available to locals

This guide has helped thousands of Los Angeles homeowners save time and money when going solar by providing them with all of the latest incentives available in the area. Let’s get started!

Ecowatch Author Dan Simms

By Dan Simms, Solar Expert

Updated 9/19/2022

Why You Can Trust EcoWatch

Our solar experts have sifted through hundreds of local governments’ and local utility companies’ websites to find accurate information about current solar incentives in each state. We’ve also unbiasedly ranked and reviewed hundreds of solar installers to empower you to make the right choice for your home.

Jump to Section:

  1. How Much Can You Save With Solar Incentives in Los Angeles?
  2. What Incentives or Solar Tax Programs Are Offered In Los Angeles For Homeowners?
  3. How Do Homeowners Redeem Solar Incentives In Los Angeles?
  4. What Incentives or Solar Tax Programs Are Offered In Los Angeles for Businesses?
  5. FAQ: Los Angeles Solar Incentives

When you’re ready to speak with a qualified professional, follow the links below. Each of these companies can help you identify and apply for incentives available in Georgia.

Disclaimer: This article is for informational purposes only. It should not be relied on for and is not intended to provide accounting, legal, or tax advice.

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How Much Can You Save With Solar Incentives in Los Angeles?

Solar panel systems in Los Angeles are undeniably expensive. Thankfully, California and the City of Los Angeles have quite a few solar saving opportunities, incentives, and rebates available that can drastically bring down the price you’ll pay for solar.

The average L.A. resident can save approximately $7,537 by taking advantage of the solar incentives available in the city.

These savings assume a few things about your system and your property in Los Angeles, including:

  • The average federal ITC in L.A. is $4,914, which is based on the average solar panel system price of $16,380
  • The average amount of property tax you’ll save in the first year is around $278. This is based on the average system value of $16,380 and the average property tax rate in Los Angeles of 1.17%1
  • You are eligible for net metering or you couple your panels with a solar energy storage system of at least 10 kWh in capacity
  • You are a customer of Pacific Gas & Electric (PG&E), Southern California Edison (SCE), Southern California Gas Company (SoCalGas) or San Diego Gas & Electric (SDG&E) and quality for the Self-Generation Incentive Program (SGIP), which offers a $250 rebate per kilowatt-hour of your energy storage system2

Keep in mind that these estimated savings don’t take into account the energy savings you’ll enjoy when converting to solar. This can add tens of thousands to your total savings, which we’ll calculate below.

We’ll discuss these city-specific incentives, several California solar incentives, and how these savings are calculated in the following sections.

What Incentives or Solar Tax Programs Are Offered in Los Angeles for Homeowners?

Residential solar customers in Los Angeles have access only to state incentives. There are no city-specific rebates or other perks available. Prior to this writing, we carried out extensive research on L.A.-specific incentives to ensure we hadn’t missed anything.

The table below includes a quick look at the programs offered in Los Angeles to reduce the cost of your panels or make your clean energy system more appealing overall. We’ll also provide more in-depth information on each in the sections below.

Los Angeles Solar Rebate/Incentives Description
Federal Solar Investment Tax Credit (ITC) This is a federal solar incentive that provides a tax credit for 30% of the cost of your system.
Net Metering Net metering is presently available to all CA residents. It lets you earn credit toward your energy bills for all power you produce with your panels but don’t use.3
Self-Generation Incentive Program (SGIP) The SGIP is a rebate offered to qualifying solar customers who install battery storage along with their panels. The rebate program provides $250 per kilowatt-hour your battery holds.4
Active Solar Energy System Property Tax Exclusion This is a property tax exemption that prevents your property taxes from increasing based on the increase in the value of your home represented by your solar system.5
Single-Family Affordable Solar Homes (SASH) Program This nonprofit program is for qualifying low-income households. It aims to lower the cost of going solar by providing rebates and incentives upfront.

Federal Solar Investment Tax Credit (ITC)

The ITC is a federal solar incentive that is available to all residents in Los Angeles, California, and the rest of the country.

Through the ITC, you get a credit to your income taxes of 30% of the total cost of your system. In Los Angeles, where the average system cost is $16,380, the average ITC amount is $4,914. This can be rolled over for up to five years if you are unable to take advantage of the full amount for the tax year in which your system is installed.

The federal solar tax credit was extended in 2022 and will continue for the next ten years.

Net Metering Policies in Los Angeles

Net metering is one of the best policies in the solar industry. It helps reduce your electric bills, thereby helping you save significantly more over time.

Basically, you can “bank” any energy that your solar panels produce and that you don’t use and call on that energy in future months if your energy consumption ever outpaces your production. With this policy, all energy you produce is valuable, even if you don’t use it right away.

Net metering is mandated in all of the Golden State by the California Public Utilities Commission (CPUC). All energy is credited at the full retail rate, which is the best-case scenario for a net metering program.

Net metering is particularly important in Los Angeles because the electricity rates are some of the highest in the nation.6 Net metering helps reduce utility bills entirely using renewable energy sources, which helps push the savings higher.

There are challenges facing Los Angeles’ net metering policy however, so stay tuned on any updates. You can watch the video below to learn more about what to expect.

Self-Generation Incentive Program (SGIP)

The SGIP is another statewide perk offered to all California residents, including those in Los Angeles. This promotes the installation of solar batteries to help reduce strain on the power grid.

The SGIP offers a $250 rebate for every kilowatt-hour your solar batteries hold. Since the Tesla Powerwall is the most popular battery option, we’ve estimated savings based on installing one Powerwall.

Each battery holds around 12 kilowatt-hours, which comes out to a rebate of $3,000 around 25% of the cost of the battery. Installing two Powerwalls could push your rebate up to $6,000.

This program also provides more substantial rebates to qualifying solar customers:

  • The Equity option provides a rebate of $850 per kilowatt-hour installed or around $10,200 per Tesla Powerwall
  • The Equity Resiliency option provides a rebate of $1,000 per kilowatt-hour installed or around $12,000 per Powerwall7

LA-image04

Courtesy: Tesla

Active Solar Energy System Property Tax Exclusion in Los Angeles

This tax exclusion is similar to a property tax exemption for your solar equipment. Usually, any home improvement that raises your property value will also affect your taxes, but this incentive helps avoid tax hikes by excluding your system from your assessed value.

Since the average system in Los Angeles is worth around $16,380 and the property tax rate is approximately 1.17% of the assessed value, this perk saves LA residents an average of $278 per year on property taxes.

It should be noted that this won’t reduce your current taxes; rather, if you install a solar system your taxes won’t increase by an average of $278, which without the exclusion they would. 

Single-Family Affordable Solar Homes (SASH) Program For Los Angeles

The SASH Program — also called the Disadvantaged Communities – Single-Family Solar Homes (DAC-SASH) Program — was initiated by the California Solar Initiative (CSI) to make solar more affordable for low-income households.

SASH provides an up-front rebate of up to $3 per watt installed on your home. Since this is a capacity-based solar incentive, the total amount you get back will be based on the size of your system.

Since the average system size in Los Angeles is around 6 kilowatts, the typical savings will be around $18,000. This often covers the entire cost of the solar electric system, which averages around $16,380 in CA.

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How Do Homeowners Redeem Solar Incentives In Los Angeles?

Applying for or redeeming solar incentives in L.A. is fairly straightforward. We’ll include some information on the process of redeeming each of the incentives mentioned above.

Federal Solar Tax Credit

When it comes time to do your taxes, you or your accountant will simply need to file federal tax form 5695. Your federal income taxes will be adjusted according to the cost of your system, which you’ll need to substantiate with documentation from your installer.

If you use a tax preparer like H&R Block or TurboTax, the system will automatically ask you if you’ve installed solar for the tax year.

Net Metering Setup in Los Angeles

Thankfully, net metering is mandated in CA, so you’ll be automatically enrolled once you install solar on your home. Your electric company will keep track of all overproduction, and your banked energy will be allocated toward future bills if your production doesn’t cover consumption.

At the end of each 12-month billing cycle, you’ll be paid for any energy you produced and didn’t use. The energy is paid according to the net surplus compensation (NSC) rate, which is a 12-month average for energy prices.8 This can help you pay off your system more quickly, which could lead to additional energy savings in the long run.

LA-image04Credit: Patrick Neil / Pixabay

Self-Generation Incentive Program (SGIP) Application Process

The process for applying for the SGIP rebate is a bit more complicated.

You’ll need to start by ensuring you work with a registered “developer” or solar installer. Most of the best solar installers in Los Angeles will be registered. In many cases, your solar panel installation company will also handle the application for you on the SelfGenCA website.

If not, you can register as a standalone applicant and submit the forms yourself. You can also register as the developer if needed. You’ll need information about your system from your installer, including:

  • The type of equipment installed
  • The energy capacity of the batteries
  • The brands of the batteries
  • Contact information for your solar installer and
  • Schematics for your system

Once you have that information, you can provide it on the SelfGenCA website to begin the process. You might need additional information along the way.

Active Solar System Property Tax Exclusion Filing

Getting the tax exclusion benefit for your photovoltaic (PV) system is also pretty straightforward.

When it comes time to file your taxes for the year your system was installed, you or your accountant will need to file California Form BOE-64-SES. You’ll need basic system information, including the contact info for the installer, the value of the system and any rebates you or your installer received for the system.

Single-Family Affordable Solar Homes (SASH) Program Filing

Applying for the SASH Program is somewhat involved as well. We’ll break down the initial steps to get you started below.

First, you’ll need to contact GRID Alternatives to confirm eligibility. According to the CPUC, you’ll need to meet the following requirements to be eligible9:

  • You must be a customer of PG&E, SCE or SDG&E
  • You must own your home
  • You must live in your home
  • Your household income must be less than 80% of the median income in L.A.
  • Your home must be defined as “affordable housing”

If you are eligible, you can apply for the program through GRID Alternatives.

What Incentives or Solar Tax Programs Are Offered In Los Angeles for Businesses?

Most of the incentives available to residential property owners in L.A. are also available to business owners. These include net metering, the SGIP Program and the property tax exclusion.

The only main differences are that the ITC for businesses is a credit for 30% of your system’s value and that the SASH Program is not available.

Previously, the Los Angeles Department of Water and Power (LADWP) offered a solar rebate for both residential and commercial solar customers. Unfortunately, this is no longer available and currently isn’t scheduled to be reinstated by the LADWP.10

EcoWatch Preferred Partners

Here is a list of preferred partners in this area.

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FAQ: Los Angeles Solar Incentives

Below, we’ll answer some of the most common questions we get about solar incentives in LA.

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Dan Simms

Solar Expert

Dan Simms is an experienced writer with a passion for renewable energy. As a solar and EV advocate, much of his work has focused on the potential of solar power and deregulated energy, but he also writes on related topics, like real estate and economics. In his free time — when he's not checking his own home's solar production — he enjoys outdoor activities like hiking, mountain biking, skiing and rock climbing.