2023 Solar Incentives Guide for Napa, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Napa.
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 Napa?
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/
Solar incentives encourage homeowners to make the switch to renewable energy by providing financial incentives meant to lower the burden of solar panel installation and use. Various kinds of incentives, including discounts, cash back or credit towards your monthly utility bill, might be available to you. Some incentives may be offered by the state of California, by your utility company or by county or municipality, while others are federal. Some broad categories of solar incentives include:
- Net Metering: Be sure to speak to your Napa utility company about signing a net metering contract. This allows you to receive credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You might receive either a dollar-for-dollar credit or a percentage of the value.
- Solar Renewable Energy Certificate (SREC): SRECs and other similar performance-based incentives are normally handled at the state level. Once your solar panel system meets a certain threshold (usually a small amount of energy production), you can receive SRECs that you can then sell to your utility company or other buyers. The money you receive is usually considered part of your taxable income.
- Rebates: Solar companies may 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. Any rebates you receive will usually come off your total price before any tax credits are calculated.
- Tax Exemptions: Your solar panels may qualify for both sales tax and property tax exemptions. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to exclude the value added by your solar panels when calculating property taxes on your home.
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government. (A tax credit is different from a tax deduction.)
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Federal Solar Incentives
Federal solar incentives are probably the first thing that you think of when thinking about solar incentives. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a specified percentage of the cost of your solar system.
The ITC can be applied to solar systems installed after January 1, 2006 on a primary or secondary residence that you own in the United States. The credit initially covered 30% of the total cost — for panels, accessories, equipment and labor — although that amount may range from 26-30%, depending on the installation date of your solar system. There is no cap on the claim amount.
Contacting your local Napa solar panel installer is the best way to understand how the ITC could apply to you.
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. Homeowners are now eligible for a credit equal to 30% of the total solar system installation costs for projects started after January 1, 2022 and completed before the end of 2032. This percentage will then begin to decrease yearly until the Clean Energy Credit ends in 2035. Starting in 2023, it will also be easier to qualify for credits for energy storage systems under this new program.
More information about the new Inflation Reduction Act can be found here. Your local Napa solar panel installer can answer your questions and explain how the new Clean Energy Credit may apply to you.
State & Local Solar Incentives
Some solar incentives may be provided by state and local governments. Like with federal incentives, these could include tax credits, rebates and more. Some incentives are ongoing, while others are offered for only a limited time. Local solar incentives could come from the California government, or from your specific county or municipality.
Next Steps for Installing Solar in Napa
Solar incentives can be provided by the federal government, the California government or your local utility company. The large number of solar incentives available has facilitated the nationwide growth of solar energy use in the last 15 years. Reaching out to your local Napa solar panel installation company is the best first step towards getting all the incentives you qualify for when you switch to solar energy.
EcoWatch's Napa, CA Solar Incentives FAQs
How can I learn if I qualify for specific solar incentives?
It's best to speak with your local Napa solar installer for a better understanding of which incentives your project may qualify for. In most cases, solar incentives apply to new solar systems installed on a property you own (in the U.S.) between the dates specified by the incentive. Some incentives, such as those offered by the government of California, may have other requirements.
I already have solar panels. Do I qualify for any incentives?
Your best bet is to talk to the company that installed your solar system — or call a local Napa solar installer — to clarify which incentives you may qualify for. If your system was installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
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 Napa's top solar panel companies.
How long until the federal solar tax credit ends?
The federal solar tax credit, previously called the ITC and now titled the Clean Energy Credit, is slated to end January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
Can I use multiple types of renewable energy to power my home?
You can use multiple types of renewable energy, or a combination of renewable and non-renewable energy, to power your home. Make sure you go over your ideas with your local Napa solar installer. They can help you plan your project and also help you understand the various incentives that you will or won't 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.