2024 Solar Incentives Guide for Monterey, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Monterey.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 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 Monterey?
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 propertyThe 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 financial incentives that are in place to encourage increased use of renewable energy by making installing and using solar panels more affordable. You may qualify for different types of incentives, such as cash back, discounts or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of California and others from the federal government. Some solar incentives you might qualify for are:
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.
- Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are typically handled by your state government. Once your solar system meets a predetermined threshold (generally a small amount of energy production), you are eligible to receive SRECs that can then be sold to your utility company or other buyers. The money you make is generally considered part of your taxable income.
- Net Metering: Be sure to talk with your Monterey utility company about signing a net metering agreement. This will allow you to receive credit towards your utility bill every month for the value of excess energy generated by your solar panels. You may receive either a dollar-for-dollar credit or a percentage of the value.
- Rebates: Rebates, or partial refunds after a purchase, are normally applied prior to any solar tax credits being calculated. Solar rebates might be provided by your local utility company, by your state or by your county.
- Tax Exemptions: Sales tax exemptions are applied at the time of purchase for your solar panels. Property tax exemptions let you ignore the value added by your solar system when you're calculating the amount of property tax you need to pay on your home.
Best Regional Coverage
Momentum Solar
- Great warranty coverage
- Representatives are experts on local policies
- Concierge service ensures steady communication
- Slightly limited service offerings
Best for Leasing
Sunrun
- Expansive service area
- Many financing options
- Some reported issues with customer service
- Some reported issues with door-to-door sales
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some familiarity with. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a specified percentage of your solar system's cost.
The ITC was originally for 30% of the total cost of solar panel installation, although it has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total cost of installation includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum claim amount. The ITC can be applied to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.
To more fully understand how the ITC might apply to you, call your local Monterey solar panel installation expert and ask for more information.
The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit has increased the current credit up to 30% for solar installation projects started after January 1, 2022, and completed by the end of 2032. At this point, the percentage will see a slight decrease annually until the program expires in 2035. The expansion also makes credits for energy storage systems even easier to claim, beginning in 2023.
Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit applies to you, reach out to your local Monterey solar installation expert.
State & Local Solar Incentives
There are more than just federal solar incentives; tax credits, rebates and more may be offered at the state and local level. Incentives may be given by your county or municipality, or by the state of California. Some incentives may be available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Monterey
Solar incentives can be offered by the California government, the federal government or your local utility company. The variety of incentives available has contributed to a large increase in solar energy use in the last 15 years. Your local Monterey solar panel installation company can give you more information about which incentives you should apply for, and get you feeling good about making the change to renewable energy today.
EcoWatch's Monterey, CA Solar Incentives FAQs
How can I learn if I qualify for specific solar incentives?
It's best to speak with your local Monterey solar installer for a better understanding of which incentives your project may qualify for. Generally, solar incentives apply to new solar panel systems installed on a property you own (in the U.S.) between the dates specified by the incentive. Some incentives, like those offered by the government of California, might have additional requirements.
How much can I save on my electric bill annually if I add solar panels to my Monterey home?
Generally, Monterey homeowners who install solar panels save about $1,814.45 per year, or about $34,474.51 over 20 years after making the switch.
What are the highest-rated solar panel installation companies near me?
To find the right solar panel installer for you, check out our guide to Monterey's top solar panel companies.
Can I qualify for incentives both towards the initial cost of solar panels, and later as reimbursement?
The order that incentives will be applied in might vary depending on which incentives you are claiming but usually yes, you can claim multiple types of incentives for your solar project. Get in touch with your solar installer or a local tax professional to ensure you are claiming all the incentives you're eligible for and applying them in the correct order.
What if I add solar panels to a vacation home, rental property or commercial property? Will I still qualify for incentives?
Many solar incentives 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 details. We recommend getting in touch with your local solar installer and/or tax professional to best understand what incentives may apply to your specific situation.
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.