2023 Solar Incentives Guide for Piedmont, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Piedmont.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Piedmont?
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
Solar incentives are intended to encourage homeowners to make the switch to renewable energy by offering incentives that lower the financial burden of solar panel installation and use. Incentives may include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are provided by the federal government, while others are offered by the California government or your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Net Metering: Net metering becomes relevant once your solar system is up and running. If you've signed a net metering agreement with your Piedmont utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some areas, this is a dollar-for-dollar credit, while in other places you might be refunded a percentage of the value.
- Tax Exemptions: Tax exemptions may come in two forms. First, there is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption. This allows you to ignore the added value of your solar system when paying property tax on your home.
- Rebates: Solar rebates might be provided by your state or county, or by your local utility company. These rebates are essentially cash back that is applied after you purchase a solar system and before tax credits are calculated.
- Tax Credits: Tax credits lower, dollar-for-dollar, how much income tax you owe the federal government. Tax credits are different from tax deductions.
- Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that normally counts as part of your taxable income. Typically, you must meet a certain (small) threshold of energy production before your solar system can earn SRECs or similar performance-based incentives. SRECs and similar incentives are typically handled by your state government.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some knowledge of. 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 certain percentage of the cost of your solar system.
The ITC applies to the value of solar panels installed on your primary or secondary residence in the United States. The solar system has to have been installed on a property you own after January 1, 2006 for you to claim the credit. The ITC initially covered 30% of all system installation costs (panels, labor, equipment and accessories), 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 amount you can claim.
Your local Piedmont solar panel installation expert can provide you with more information about the ITC and how it might apply to your situation.
In August 2022, the ITC (now referred to as the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners can apply for a credit for 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit ends 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, reach out to your local Piedmont solar installers.
State & Local Solar Incentives
Some solar incentives may be offered at the local or state level. Similar to federal incentives, these could include tax credits, rebates and more. Some incentives are ongoing, while others may only be available for a limited time. Incentives may be offered by the California government, or by your county or municipality.
Next Steps for Installing Solar in Piedmont
Solar energy use nationwide has increased enormously in the past 15 years, in part due to the proliferation of solar incentives. You can obtain these incentives from the California government, the federal government or your local utility company. Talking to your local Piedmont solar panel installer is an excellent first step towards getting all the incentives you qualify for when you switch to solar energy.
EcoWatch's Piedmont, CA Solar Incentives FAQs
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