2025 Solar Incentives Guide for North Fair Oaks, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in North Fair Oaks.
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 North Fair Oaks?
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
City of Palo Alto Utilities - Solar Water Heating Program
Single-family residential electricity or propane-displacing systems: $0.54 per kWh displaced
Multifamily and Commercial gas-displacing systems: $14.53 per therm displaced
Multifamily and Commercial electricity or propane-displacing systems: $0.42 per kWh displaced
Low-Income Multifamily gas-displacing systems: $19.23/therm displaced
Low-Income Multifamily Electric or Propane Displacing systems: $0.56/kWh displaced
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are meant to help mitigate the cost of installing solar panels on your home. This category of financial incentives is designed to encourage more Americans to switch to renewable energy. Various types of incentives, like cash back, discounts or monthly utility bill credits, might be available to you. Certain incentives may be offered by the state of California, by your utility company or by county or municipality, while other incentives are federal. Some solar incentives you might qualify for are:
- Tax Exemptions: Sales tax exemptions are effective at the time of purchase for your solar panels. Property tax exemptions let you ignore the value added by your solar system when calculating the amount of property tax you need to pay.
- Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the federal government. (This is different from a tax deduction.)
- Rebates: Some solar companies will help you claim a rebate, or partial refund after purchase, for your solar system. Counties or states will also offer limited-time rebates at various times. If you receive a rebate, that amount will usually come off the total price before any tax credits are calculated.
- Net Metering: Net metering becomes relevant once your solar system is up and running. If you've signed a net metering agreement with your North Fair Oaks utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this is a dollar-for-dollar credit, while in other areas you might make back a percentage of the value.
- Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives may be available to you if your solar system produces more than a specified (generally small) amount of electricity. These types of incentives are usually handled at the state level. You can sell your SRECs to your utility company or other buyers, and the money you make is typically considered part of your taxable income.
Federal Solar Incentives
When thinking 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 percentage of the cost of your solar system.
The ITC can be applied to a solar system installed on your primary or secondary residence in the United States. The solar system has to have been installed after January 1, 2006, on a property you own for you to claim the credit. Originally, the ITC covered 30% of all installation costs (panels, equipment, accessories and labor), although the amount has fluctuated over time 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.
Speaking with your local North Fair Oaks solar panel installer is the best way to learn more about how the ITC could apply to your situation.
In August 2022, the Inflation Reduction Act made revisions to the ITC, now dubbed the Clean Energy Credit. 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. This amount will decrease slightly on a yearly basis until the end of the current program. The expansion also makes it easier to get credit for energy storage systems, starting in 2023.
More information about the new Inflation Reduction Act can be found here. Your local North Fair Oaks solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it applies to you.
State & Local Solar Incentives
In addition to those provided at the federal level, there are often also state solar incentives. Rebates, tax credits and more can be offered at a more local level. Incentives may be offered by your county or municipality, or by the state of California. Certain incentives may be available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in North Fair Oaks
You can receive solar incentives from the California government and the federal government, as well as from your local utility company. Growing availability of solar initiatives over the last 15 years has helped greatly increase nationwide adoption of solar energy. When you're ready to make the switch to solar energy, talking to your local North Fair Oaks solar panel installation expert is an excellent place to start.
EcoWatch's North Fair Oaks, CA Solar Incentives FAQs
How do I learn if I qualify for certain solar incentives?
Broadly, 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 ones handled by the California government or by your county/municipality, may have additional qualifications. Talk to your local North Fair Oaks solar installer to find out what incentives your project may qualify for.
How much will solar panels save me annually on my electric bill in North Fair Oaks?
Generally, homeowners in North Fair Oaks who install solar panels save around $1,645.27 per year, or about $31,260.18 over 20 years after making the switch.
Who installs solar panel systems near me?
To find a top-rated solar panel installer, check out our guide to North Fair Oaks' best solar panel companies.
How long until the federal solar tax credit ends?
The federal solar tax credit, formerly known as the ITC and now called the Clean Energy Credit, is set to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
If I switch my appliances out for ones that can utilize solar energy, are there benefits I can claim?
The recently passed Inflation Reduction Act introduces several incentives that reward homeowners for making eco-friendly upgrades. Some of these incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
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.