2025 Solar Incentives Guide for Rancho San Diego, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Rancho San Diego.
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 Rancho San Diego?
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 designed to mitigate the cost of installing solar panels on your home. This category of financial incentives is intended to encourage more Americans to make the switch to renewable energy. The incentives may include cash back, upfront discounts or credit towards your monthly utility bill. Some incentives are offered by the federal government, some by the state of California and some by your utility company, county or municipality. You might qualify for any of the following types of solar incentives:
- Net Metering: You can sign a net metering contract with your Rancho San Diego utility company. This agreement may apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then deduct this value from your monthly utility bill.
- Tax Exemptions: Sales tax exemptions go into effect at the time of purchase for your solar panels. Property tax exemptions allow you to exclude the value added by your solar system when you're calculating the amount of property tax you need to pay on your home.
- Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives might be available to you if your solar system produces over a specified (generally small) amount of electricity. These types of incentives are usually 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 normally considered part of your taxable income.
- Rebates: Solar rebates may be provided by your local utility company, or by your county or state. These rebates are essentially cash back that is applied after you purchase solar panels and before tax credits are calculated.
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some familiarity with. The Federal Solar Investment Tax Credit, or ITC, is probably the most well-known federal solar incentive. The ITC provides you with a tax credit for a specific 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. Originally, the tax credit was for 30% of the total cost – for panels, accessories, labor and equipment – although it may range from 26-30%, depending on when your solar system was installed. There is no cap on the amount you can claim.
Speaking with your local Rancho San Diego solar panel installer is the best way to learn more about how the ITC may apply to you.
In August 2022, the ITC (now referred to as the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. The new Clean Energy Credit now runs until 2035. American homeowners can now receive a 30% credit for solar systems installed between January 1, 2022, and December 31, 2032. The credit will then see a slight annual decrease until its expiration. Starting in 2023, the program expansion will also make credits for energy storage systems even easier to claim.
Click here to learn more about the new Inflation Reduction Act. Your local Rancho San Diego solar panel company can answer your questions and explain how the new Clean Energy Credit will apply to you.
State & Local Solar Incentives
In addition to federal solar incentives, there are often also state ones. Tax credits, rebates and more can be offered at a more local level. These incentives may be provided by your county or municipality, or by the California government. Some are ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Rancho San Diego
Solar incentives may be provided by your local utility company, the federal government or the California government. The variety of incentives available has facilitated the nationwide growth of solar energy use in the last 15 years. If you're ready to make the change to solar energy, talking to your local Rancho San Diego solar panel installation expert is a great first step.
EcoWatch's Rancho San Diego, CA Solar Incentives FAQs
I already have solar panels. Does my system qualify for any incentives?
An excellent idea would be to talk to someone from the company that installed your solar panels – or call a local Rancho San Diego solar installer — to clarify which incentives you might 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 panels installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
How much will solar panels save me on my electric bill in Rancho San Diego annually?
Generally, homeowners in Rancho San Diego who install solar panels save approximately $1,637.07 per year, or about $31,104.39 over 20 years after making the switch.
When does the federal solar tax credit end?
The federal solar tax credit, previously called the ITC and now called the Clean Energy Credit, is set to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
I want to trade in my old appliances for ones that are more energy-efficient. Are there any incentives I can get?
The recently passed Inflation Reduction Act includes provisions for several incentives designed to reward homeowners for making eco-friendly upgrades. Some of these incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
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