2023 Solar Incentives Guide for Mendota, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Mendota.
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 Mendota?
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 solar panels on your home. This category of financial incentives is designed to encourage more people to make the switch to renewable energy. The incentives could include cash back, upfront discounts 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. Categories of solar incentives include:
- Tax Exemptions: Your solar panel system may qualify for exemptions on both sales and property tax. Sales tax exemptions are applied at the time of purchase. Property tax exemptions let you exclude the added value of the solar panels when you are calculating property taxes on your home.
- Net Metering: Net metering factors in once your solar system is up and running. If you have in place a net metering agreement with your Mendota utility company, it will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in others you may make back a percentage of the value.
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the federal government.
- Rebates: A solar rebate is a partial refund given after you've purchased your solar system. Rebates could be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.
- Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce more than a specified (usually small) amount of electricity can qualify for SRECs or other performance-based incentives. SRECs and similar incentives 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.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some familiarity with. One of the incentives that most people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a specific percentage of your solar system's cost.
The ITC covers solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, equipment, accessories and labor. This credit can be claimed on solar panels installed on a primary or secondary residence in the United States that you own. The original claim amount was 30% of the total cost, although certain projects may qualify for only 26%, depending on the details. There is no maximum claim amount.
To better understand exactly how much the ITC could save you, talk to your local Mendota solar panel installer.
The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. With the new provisions, solar installation projects started after January 1, 2022 and completed by the end of 2032 might qualify for a 30% tax credit. This credit amount will then decrease slightly each year until the current Clean Energy Credit expires in 2035. Starting in 2023, it will also be easier to claim credits for energy storage systems with the new act.
More information about the new Inflation Reduction Act can be found here. To fully understand how the new Clean Energy Credit applies to you, reach out to your local Mendota solar installation company.
State & Local Solar Incentives
Some solar incentives may be provided by state and local governments. As with federal incentives, these could include rebates, tax credits and more. These incentives — which might be provided by the state of California, or by your county or municipality — could be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Mendota
There are a number of different solar incentives: those offered by local utility companies, those offered by the California government and those offered by the federal government, to name a few. The use of solar energy has increased tremendously in the last 15 years, thanks to these incentives. Reaching out to your local Mendota solar panel installation company is an excellent first step towards making sure you get all the incentives you qualify for when you switch to solar energy.
EcoWatch's Mendota, CA Solar Incentives FAQs
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