2023 Solar Incentives Guide for Monterey Park, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Monterey Park.
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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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Monterey Park?
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 help mitigate the cost of installing solar panels on your home. This category of financial incentives is intended to encourage more homeowners to switch to renewable energy. Various kinds of incentives, like cash back, discounts or monthly utility bill credits, may be available to you. Certain incentives may be handled by the California government, by your utility company or by county or municipality, while other incentives are federal. Types of solar incentives might include:
- Tax Exemptions: Tax exemptions may come in two forms. First, there is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption, which allows you to exclude the value added by your solar system when calculating property tax for your home.
- Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce over a threshold (generally small) amount of electricity will qualify for SRECs or other performance-based incentives. SRECs and similar incentives are typically given by your state government. SRECs can be sold to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.
- Tax Credits: Tax credits decrease, dollar-for-dollar, the amount of income tax you owe the federal government. These differ from tax deductions.
- Net Metering: You may be able to sign a net metering agreement with your Monterey Park utility company. This agreement may apply to all or a percentage of the excess electricity that is generated by your solar panels. Your utility company will then deduct this value from your utility bill each month.
- Rebates: Some solar companies will help you claim a rebate, or partial refund of your purchase, for your solar panels. States or counties will also sometimes offer limited-time rebates. The value of a rebate will usually come off the total price before tax credits are calculated.
Federal Solar Incentives
When thinking about solar incentives, you likely think of federal incentives first. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. This incentive is a tax credit that reduces your taxes by a certain percentage of the money you spend on your solar system.
The ITC applies to solar panels installed on your primary or secondary residence in the United States. The solar panels have to have been installed after January 1, 2006 on a property owned by you for you to be eligible for the credit. Originally, the ITC covered 30% of all costs (panels, accessories, equipment and labor), although the covered amount has fluctuated over the last few years between 26-30%. The installation date of your solar system will determine what percentage you are eligible for. There is no cap on the claim amount.
Your local Monterey Park solar panel installer can provide more information about the ITC and how it may 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. Under the new program, solar installation projects that are completed between 2022 and 2032 might qualify for a 30% tax credit. This credit amount will then see a slight annual decrease until the current Clean Energy Credit expires in 2035. Starting in 2023, the expansion will also make it easier to get credit for energy storage systems.
Click here to learn more about the new Inflation Reduction Act. To fully understand how the new Clean Energy Credit will apply to you, reach out to your local Monterey Park solar installation expert.
State & Local Solar Incentives
There are often state solar incentives available in addition to federal ones. Rebates, tax credits and more might be available at a more local level. Some incentives are offered for only a limited time, while others are ongoing. Local solar incentives may come from the California government, or from your specific county or municipality.
Next Steps for Installing Solar in Monterey Park
Solar incentives may be provided by your local utility company, the federal government or the California government. The large number of available incentives has helped nationwide use of solar energy increase greatly in the last 15 years. Talking to your local Monterey Park solar panel installation expert is a great first step towards getting the most money possible when you switch to solar energy.
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EcoWatch's Monterey Park, CA Solar Incentives FAQs
What if I am planning to add a solar system to a vacation home, rental property or commercial property? Will I still qualify for incentives?
While we recommend speaking with your local solar installer and/or tax professional to better understand what solar incentives apply to you, many will apply to a second home, so long as that home is in the United States and owned by you. There may be other incentives available for commercial properties specifically, depending on the specifics.
How can I learn if I qualify for solar incentives?
Typically, solar incentives apply to:
- a new solar panel system
- installed on property you own
- within the U.S.
- between the dates specified by a particular incentive.
Specific incentives, including those run by the California government or by your county/municipality, might have additional qualifications. Speak with your local Monterey Park solar installer to discover what incentives your project may qualify for.
I already have solar panels. Do I qualify for any incentives?
If your solar panels were installed after January 1, 2022, you may qualify for the newly increased 30% tax credit under the Inflation Reduction Act. If you installed your system between 2006 and 2021, you may qualify for a tax credit between 26% and 30%, depending on the year it was installed. Talking to the company that installed your system, or any local Monterey Park solar installer, can help you learn more about what incentives you qualify for.
How much will solar panels save me annually on my electric bill in Monterey Park?
When you add solar panels to your home in Monterey Park, you can expect to save around $1,396.18 per year, or around $26,527.51 over 20 years.
Can I use a combination of multiple types of renewable energy to power my home?
You can power your home with multiple types of renewable energy, or a combination of renewable and non-renewable energy. Be sure to discuss your ideas with your local Monterey Park solar installer. They can help you plan your project and give you an understanding of various incentives that 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.