2023 Solar Incentives Guide for Mission Viejo, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Mission Viejo.
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 September 15, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Mission Viejo?
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/
The phrase "solar incentives" refers to a wide range of financial incentives put in place to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Solar incentives might include upfront discounts, cash back or monthly credits towards your 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:
- Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar panels. Property tax exemptions allow you to ignore the value that your solar panels add when you're calculating the amount of property tax you need to pay on your home.
- 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, there is a small threshold of energy production to meet before your solar system is eligible for SRECs or other performance-based incentives. These kinds of incentives are normally handled by your state government.
- Rebates: Your solar installer might help you claim a rebate, or partial refund of your purchase, for your solar system. States or counties will also sometimes offer limited-time rebates. The value of a rebate will usually be deducted from your total price before tax credits are calculated.
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
- Net Metering: Be sure to speak to your Mission Viejo utility company about signing a net metering agreement. This allows you to receive credit towards your monthly utility bill for the value of excess energy your solar panels generate. You could receive either a dollar-for-dollar credit or a percentage of the value.
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Federal Solar Incentives
When you think about solar incentives, you probably think of federal incentives first. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a certain percentage of the cost of your solar system.
The ITC applies to solar systems installed after January 1, 2006 on a primary or secondary residence in the United States that you own. Initially, the credit applied to 30% of the total cost — for panels, accessories, equipment and labor — although it may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the amount you can claim.
Your local Mission Viejo solar panel installation expert can provide you with more information about the ITC and how it might apply to your situation.
In August 2022, the ITC (now called the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. The Clean Energy Credit lasts until 2035. Solar installation projects started after January 1, 2022 and completed by the end of 2032 may qualify for a 30% tax credit; the amount will then decrease slightly on a yearly basis until the current program ends. The expansion also makes credits for energy storage systems even easier to claim, beginning in 2023.
More information about the new Inflation Reduction Act can be found here. Your local Mission Viejo solar panel installation expert is the best person to answer your questions about the new Clean Energy Credit and how it applies to you.
State & Local Solar Incentives
Some solar incentives may be provided at the state and local level. Like with federal incentives, these might include tax credits, rebates and more. Some incentives are ongoing, while others might only be available for a limited time. They might be provided by your county or municipality, or by the California government.
Next Steps for Installing Solar in Mission Viejo
You can receive solar incentives from the federal government and the California government, as well as from your local utility company. The growing availability of solar initiatives over the last 15 years has helped increase solar adoption nationwide. We recommend talking to your local Mission Viejo solar installer to learn more about these incentives and to ensure that you're getting the most money possible for your solar system.
EcoWatch's Mission Viejo, CA Solar Incentives FAQs
Can I claim incentives for adding solar panels to a vacation home, rental property or commercial property?
Many solar incentives are intended to apply to a property you own that is located within the United States; most secondary residences will fall into this category. There may be other solar incentives available for commercial properties, depending on the specifics. We recommend talking to your local solar installer and/or tax professional to better understand what incentives may apply to your specific situation.
What are the best solar panel installation companies near me?
To discover the best solar panel installation companies near you, take a look at our article on the best solar companies in Mission Viejo.
How long until the federal solar tax credit ends?
The Clean Energy Credit (formerly named the federal solar tax credit, or the ITC), is scheduled to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I apply for incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can receive both rebates and tax credits towards the cost of solar panels. Depending on precisely which incentives you are claiming, they may apply in a different order. Be sure to talk to your solar installer or a local tax professional to ensure that you are claiming the correct incentives and getting the most money you can.
Can I use solar and another type of renewable energy in combination to power my home?
Yes, you can use multiple types of renewable energy to power your home, such as a combination of solar and wind power. You can also combine renewable energy generation with a backup source of non-renewable energy. Be sure to discuss your plan with your local Mission Viejo solar panel installer, to get an understanding of what will be needed and what incentives you might or might 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.