2025 Solar Incentives Guide for Palm Desert, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Palm Desert.
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 Palm Desert?
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
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are intended to encourage homeowners to switch their home over to renewable energy by providing financial incentives that lower the burden of solar panel installation and use. You might qualify for different types of incentives, such as cash back, discounts or credit towards your monthly utility bill, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of California and others from the federal government. You might qualify for any of the following types of solar incentives:
- Rebates: Rebates, or partial refunds after a purchase, are usually applied before any solar tax credits are calculated. Solar rebates can be given by your local utility company, by your state or by your county.
- Net Metering: You may be able to sign a net metering agreement with your Palm Desert utility company that will apply to all or a percentage of the excess electricity your solar panels generate. They will then subtract this value from your monthly utility bill.
- Tax Exemptions: Sales tax exemptions go into effect at the point of sale for your solar panels. Property tax exemptions let you exclude the value that your solar panels add when you're calculating how much property tax you need to pay on your home.
- Solar Renewable Energy Certificate (SREC): SRECs and other similar performance-based incentives are typically handled at the state level. Once your solar panel system meets the threshold (usually a small amount of energy production), you are eligible to receive SRECs that can be sold to your utility company or other buyers. The money you make from the sale is generally considered part of your taxable income.
- Tax Credits: Tax credits lower, dollar-for-dollar, the total amount of tax you owe the government. These are different from tax deductions.
Best Regional Coverage
Momentum Solar
- Great warranty coverage
- Representatives are experts on local policies
- Concierge service ensures steady communication
- Slightly limited service offerings
Best for Leasing
Sunrun
- Expansive service area
- Many financing options
- Some reported issues with customer service
- Some reported issues with door-to-door sales
Federal Solar Incentives
When thinking about solar incentives, you likely think of federal incentives first. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a specified percentage of the cost of your solar system.
The ITC applies to solar panels installed after January 1, 2006, on a primary or secondary residence in the United States that you own. The credit initially covered 30% of the total cost – for panels, equipment, accessories and labor – although the percentage may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the claim amount.
Your local Palm Desert solar panel installer can provide you with more information about the ITC and how it might apply to your situation.
In August 2022, the Inflation Reduction Act expanded and extended the ITC, now referred to as the Clean Energy Credit. Homeowners can now receive a credit of 30% of the total costs of solar system installation for projects that began after January 1, 2022, and will be finished by the end of 2032. The credit percentage will then begin to decrease annually until the Clean Energy Credit ends in 2035. Starting in 2023, the expansion to the program will also make it easier to get credit for energy storage systems.
More information about the new Inflation Reduction Act can be found here. Your local Palm Desert solar panel installation experts can answer your questions and explain how the new Clean Energy Credit may apply to you.
State & Local Solar Incentives
Rebates, tax credits and more might be provided at multiple levels. Along with federal solar incentives, there are often state and local ones as well. Some incentives are ongoing, while others are available for a limited time. Incentives might be provided by the California government, or by your county or municipality.
Next Steps for Installing Solar in Palm Desert
There are a number of different solar incentives: those given by local utility companies, those given by the federal government and those given by the California government, to name a few. Solar energy utilization has grown enormously in the last 15 years, partially due to these incentives. Reach out to your local solar panel installation expert today to learn more and to save the most money possible on solar panels for your Palm Desert home.
EcoWatch's Palm Desert, CA Solar Incentives FAQs
How much will a solar system save me on my electric bill in Palm Desert annually?
When you add solar panels to your Palm Desert home, you can expect to save about $1,342.43 per year, or around $25,506.21 over 20 years.
What are the highest-rated solar panel installation companies near me?
To find a top-rated solar panel installer, check out our guide to the top solar companies in Palm Desert.
What are some environmental benefits of installing solar panels on my house?
You can lower your carbon footprint by 500 pounds of CO2 annually when you install solar panels. This adds up to roughly 11,000 pounds in 20 years. Solar is also a renewable energy source, which means that making the switch lessens the drain on our planet's resources.
I want to trade in my old appliances for ones that are more energy-efficient. Are there any benefits I can claim?
The recently passed Inflation Reduction Act introduces multiple incentives that reward homeowners for making eco-friendly upgrades. Some incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
Can I receive any incentives when I add solar panels to a vacation home, rental property or commercial property?
Many solar incentives are intended to apply to a property you own that is located within the United States, and most secondary residences will fall into this category. Other solar incentives may be available for commercial properties, depending on the details. We recommend speaking with your local solar installer and/or tax professional to fully understand what incentives will apply to your specific situation.
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.