2023 Solar Incentives Guide for Novato, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Novato.
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 Novato?
Property Tax Exclusion for Solar Energy Systems and Solar Plus Storage System
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 term "solar incentives" refers broadly to financial incentives designed to encourage people to use renewable energy by making solar panels more affordable. Incentives can include things like discounts, cash back or monthly utility bill credits. Some incentives are provided by the federal government, while others are offered by the California government or by your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Tax Exemptions: Sales tax exemptions are applied at the point of sale for your solar panels. Property tax exemptions allow you to exclude the value that your solar panels add when calculating how much property tax you need to pay on your home.
- Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives may be available to you if the solar system on your home produces more than a specified (typically small) amount of electricity. Performance-based incentives are typically handled at the state level. You can sell SRECs to your utility company or other buyers, and the money you make is normally considered part of your taxable income.
- Net Metering: You can sign a net metering agreement with your Novato utility company that will apply to all or a percentage of the excess electricity your solar panels generate. They will then deduct this value from your monthly utility bill.
- Rebates: Solar companies may help you claim a rebate, or partial refund of your purchase, for your solar panels. States or counties will also offer limited-time rebates at various times. The value of a rebate will usually be deducted from your total price before any tax credits are calculated.
- Tax Credits: Tax credits lower, dollar-for-dollar, the total amount of tax you owe the federal government. Tax credits are different from tax deductions.
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Federal Solar Incentives
When thinking about solar incentives, federal incentives are likely the first thing that comes to mind. It's likely that you've 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 solar panels for your home.
The ITC was originally for 30% of the total cost of installing solar panels, and has fluctuated slightly over the last few 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, equipment and labor. There is no maximum claim amount. The ITC can be applied to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.
Reaching out to your local Novato solar panel installation expert is the best way to understand how the ITC could apply to you.
The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as renaming it to the Clean Energy Credit). For solar systems installed between January 1, 2022 and December 31, 2032, homeowners may be eligible for a credit for 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to qualify for credits for energy storage systems under the new laws.
More information about the new Inflation Reduction Act can be found here. To understand how the new Clean Energy Credit applies to you, get in touch with your local Novato solar installers.
State & Local Solar Incentives
There are more than just federal solar incentives; tax credits, rebates and more may be offered at the local or state level. These incentives — which may be given by the state of California, or by your county or municipality — might be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Novato
Solar incentives can be offered by the federal government, the California government or your local utility company. The growing number of available incentives has facilitated the nationwide growth of solar energy use in the last 15 years. Call your local solar panel installer today to find out more information and to save as much money as possible on solar panels for your Novato home.
EcoWatch's Novato, CA Solar Incentives FAQs
Can I claim incentives for adding solar panels to a vacation home, rental property or commercial property?
While we recommend talking to your local solar installer and/or tax professional to fully understand what solar incentives apply to you, many will apply to a second home, as long as it is in the United States and owned by you. There may be additional incentives available specifically for commercial properties, depending on the details.
How can I find out if I qualify for specific solar incentives?
It's best to speak with your local Novato solar installer to get an understanding of which incentives your project will qualify for. Typically, solar incentives apply to new solar systems installed on property you own (in the U.S.) between the dates specified by the incentive. Some incentives, such as those provided by the California government, may have other requirements.
Who installs solar panel systems near me?
To learn about the top solar panel installers near you, read our article on Novato's top solar panel companies.
What are some environmental benefits of installing solar panels on my house?
Solar energy is renewable — by changing where you get your energy, you help lessen the strain on our planet's resources. A solar system can also reduce your home's CO2 emissions by 250 pounds yearly, or around 5,000 pounds in 20 years.
Can I use 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. Make sure you go over your plan with your local Novato solar installer. They can help you with the plan for 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.