2023 Solar Incentives Guide for North Richmond, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in North Richmond.
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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What Solar Tax Credits, Incentives, and Rebates are Available in North Richmond?
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
The phrase "solar incentives" generally refers to financial incentives that are in place to encourage increased use of renewable energy by making the installation and use of solar panels more affordable. You might be eligible for different kinds of incentives, including cash back, discounts or monthly utility bill credits, 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 Exemptions: Your solar panel system may qualify for both sales tax and property tax exemptions. Sales tax exemptions are applied at the time of purchase. Property tax exemptions allow you to exclude the value added by your solar panels when you are calculating property taxes on your house.
- Rebates: Solar rebates might be provided by your county or state, or by your local utility company. These rebates are essentially cash back that is applied after you pay for solar panels and before tax credits are calculated.
- Net Metering: You can sign a net metering contract with your North Richmond utility company that will apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then subtract this value from your utility bill each month.
- Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives may be available to you if you have a solar system that produces over a specified (generally small) amount of electricity. These types of incentives are normally handled by the state government. You can sell any SRECs you have to your utility company or other buyers, and the money you receive in return is typically considered part of your taxable income.
- Tax Credits: Tax credits reduce, dollar-for-dollar, the amount of income tax you owe the government. Tax credits are different from tax deductions.
Federal Solar Incentives
When thinking about solar incentives, you likely think of federal incentives first. One of the incentives many people are likely familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a predetermined percentage of your solar system's cost.
The ITC originally covered 30% of the total cost of installing solar panels, although it has fluctuated slightly over the years between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total installation cost includes the panels themselves as well as the cost of accessories, equipment and labor. There is no maximum amount you can claim. The ITC applies to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be owned by you and in the United States.
To better understand exactly how much money the ITC could save you, get in touch with your local North Richmond solar panel installer.
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. The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar installations undertaken between January 1, 2022 and December 31, 2032. At this point, the percentage will be reduced slightly each year until the end of the program in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems with the new act.
More information about the new Inflation Reduction Act can be found here. The best way to understand how the new Clean Energy Credit might apply to you is to get in touch with your local North Richmond solar panel company.
State & Local Solar Incentives
Some solar incentives are often also provided at the state and local level. Like with federal incentives, these can include tax credits, rebates and more. Incentives may be handled by the state of California, or by your county or municipality. Certain incentives might only be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in North Richmond
Solar incentives can be provided by the federal government, the California government or your local utility company. The large number of available solar incentives has facilitated the nationwide growth of solar energy use in the last 15 years. Your local North Richmond solar panel installer can provide you with more details about which incentives you may qualify for, and get you on track to switch to renewable energy today.
EcoWatch's North Richmond, CA Solar Incentives FAQs
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