2023 Solar Incentives Guide for Madera, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Madera.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Madera?
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
The term "solar incentives" refers broadly to financial incentives that are in place to encourage the adoption and use renewable energy by making installing and using solar panels more affordable. Incentives can include things like discounts, cash back or credit on your utility bill each month. Some incentives are offered by the federal government, while others are offered by the California government or by your specific utility company, county or municipality. Categories of solar incentives include:
- Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that is generally considered part of your taxable income. In most cases, a certain (small) threshold of energy production must be met before your solar system qualifies for SRECs or similar performance-based incentives. Incentives like these are normally handled by your state government.
- Rebates: Solar rebates can be offered by your local utility company, or by your county or state. These rebates work as cash back that is applied after you pay for a solar system and before tax credits are calculated.
- Tax Exemptions: These could come in the form of property tax exemptions, which can let you exclude the value of your solar system when paying property tax on your house. You could also look for exemptions on sales tax at the time of purchase.
- Net Metering: Net metering is an incentive you can get once your solar system is up and running. If you've signed a net metering agreement with your Madera utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some places, this credit is dollar-for-dollar, while in other areas you might make back a percentage of the value.
- Tax Credits: Tax credits decrease, dollar-for-dollar, the amount of income tax you owe the federal government. Tax credits differ from tax deductions.
Federal Solar Incentives
When someone says "solar incentives," you probably think of federal incentives first. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit equal to a certain percentage of the money you spend on your solar system.
The ITC applies to the total cost of solar panel installation, including the panels themselves as well as labor, accessories and equipment. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence that you own, as long as it is located in the United States. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum amount you can claim.
Reaching out to your local Madera solar panel installation expert is the best way to understand how the ITC could apply to your situation.
In August 2022, the ITC (now called the Clean Energy Credit) was expanded and extended by the passage of the Inflation Reduction Act. Homeowners can now receive a credit of 30% of the total costs of solar system installation for projects that began after January 1, 2022 and will be finished by the end of 2032. The credit percentage will then begin to decrease yearly until the Clean Energy Credit ends in 2035. The expansion also makes credits for energy storage systems even easier to claim, starting in 2023.
Click here to learn more about the new Inflation Reduction Act. To better understand how the new Clean Energy Credit will apply to you, reach out to your local Madera solar installation expert.
State & Local Solar Incentives
There are more than just federal solar incentives; tax credits, rebates and more are often offered at the local or state level. Some incentives are offered for only a limited time, while others are ongoing. These local incentives may come from your county or municipality, or from the California government.
Next Steps for Installing Solar in Madera
There are a variety of solar incentives: those offered by local utility companies, those offered by the federal government and those offered by the California government, to name a few. The use of solar energy has increased enormously in the last 15 years, thanks to these incentives. If you're ready to make the switch to solar energy, talking to your local Madera solar panel installation expert is an excellent place to start.
EcoWatch's Madera, CA Solar Incentives FAQs
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.