2023 Solar Incentives Guide for Pasadena, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Pasadena.
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.
Get a free quote from one of our trusted Pasadena solar installers to see how much you can save.
Please enter a valid 5-digit zip code!
Updated March 14, 2023
Why you can trust EcoWatch
What Solar Tax Credits, Incentives, and Rebates are Available in Pasadena?
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/
The phrase "solar incentives" refers broadly to financial incentives designed to encourage the adoption and use renewable energy by making installing and using solar panels more affordable. Different kinds of incentives, such as cash back, discounts or credit towards your monthly utility bill, may 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. Categories of solar incentives include:
- Rebates: Rebates, or partial refunds after a purchase, are usually given prior to any solar tax credits being calculated. Rebates might be given by your local utility company, by your county or by your state.
- Net Metering: Net metering factors in once your solar system is up and running. If you've signed a net metering agreement with your Pasadena utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some places, this credit is dollar-for-dollar, while in others you might receive a refund equivalent to a percentage of the value.
- Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are normally handled by your state government. Once your solar panel system meets the threshold (typically a small amount of energy production), you can receive SRECs that can then be sold to your utility company or other buyers. The money you receive is usually considered part of your taxable income.
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the government.
- Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar system. Property tax exemptions allow you to ignore the added value of your solar system when calculating the amount of property tax you need to pay on your house.
Federal Solar Incentives
When someone says "solar incentives," you probably think of federal incentives first. The solar incentive that you're most likely to have heard of 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 initially applied to 30% of the cost of solar system installation, 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 cost of installation includes the panels themselves as well as the cost of accessories, labor and equipment. 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 owned by you and in the United States.
To understand exactly how much the ITC could save you, talk to your local Pasadena solar panel installation expert.
The ITC has been renewed and expanded following 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. After this, the credit percentage will see a slight decrease annually until the end of the program in 2035. Beginning in 2023, it will also be easier to qualify for credits for energy storage systems with the new act.
Click here to learn more about the new Inflation Reduction Act. To better understand how the new Clean Energy Credit will apply to you, talk to your local Pasadena solar installers.
State & Local Solar Incentives
Not all solar incentives are federal; rebates, tax credits and more may be offered at the state and local level. Some incentives are ongoing, while others are offered for only a limited time. Your local solar incentives may come from your county or municipality, or from the California government.
Next Steps for Installing Solar in Pasadena
You can apply for and receive solar incentives from the California government and the federal government, as well as from your local utility company. The increased availability of solar initiatives in the past 15 years has helped greatly increase nationwide adoption of solar energy. We recommend talking to your local Pasadena solar installer to learn more about these incentives and to be sure that you're getting the most money possible for your solar panels.
Best Regional Coverage
Momentum Solar
- Great warranty coverage
- Representatives are experts on local policies
- Concierge service ensures steady communication
- Slightly limited service offerings
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
EcoWatch's Pasadena, CA Solar Incentives FAQs
If my house already has solar panels, can I still claim incentives?
Your best bet is to talk to the company that installed your solar panels — or speak to a local Pasadena solar installer — to learn about which incentives you may qualify for. If your solar panels were installed after January 1, 2022, you likely qualify for the recently increased 30% tax credit under the Inflation Reduction Act. Solar systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
What are the top solar panel installation companies near me?
To find a top-rated solar panel installer, check out our guide to the best solar companies in Pasadena.
Can I apply for incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can receive both tax credits and rebates towards the cost of solar panels. Depending on precisely which incentives you are receiving, they may apply in a different order. Make sure that you speak with your solar installer or a local tax professional to verify that you are claiming incentives correctly and that you're getting the most money you can.
Can I use multiple types of renewable energy to power my home?
Yes, you can use multiple types of renewable energy to power your home, such as a combination of geothermal and solar. You can also use both renewable energy sources and a non-renewable backup source of energy. You should discuss the details of your plan with your local Pasadena solar installation expert, so that you understand what you'll need and what types of incentives 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.