2023 Solar Incentives Guide for Riverside, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Riverside.
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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What Solar Tax Credits, Incentives, and Rebates are Available in Riverside?
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 meant to encourage homeowners to make the switch to renewable energy by offering incentives meant to lower the financial burden of solar panel installation and use. Various kinds of incentives, such as cash back, discounts or credit towards your monthly utility bill, may be available to you. Some incentives may be handled by the California government, by your utility company or by county or municipality, while others are federal. Some solar incentives you might qualify for are:
- Rebates: A solar rebate is a partial refund after the purchase of your solar panels. These could be offered by your local utility company, your state or your county. The rebates are usually applied before tax credits are calculated.
- Tax Exemptions: Your solar panel system could qualify for both sales tax and property tax exemptions. Sales tax exemptions are applied at the time of purchase. Property tax exemptions allow you to ignore the value that solar panels add when calculating property taxes on your house.
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
- Net Metering: Net metering becomes relevant after your solar system is up and running. If you have a net metering agreement with your Riverside utility company, they will subtract the value of the excess energy your solar system produces from your monthly utility bill. In some locations, this is a dollar-for-dollar credit, while in other places you may receive a refund equivalent to a percentage of the value.
- Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce over a specific (usually small) amount of electricity will qualify for SRECs or similar performance-based incentives. SRECs and performance-based incentives in general are typically given at the state level. You can sell SRECs to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.
Federal Solar Incentives
Federal solar incentives are likely the first thing that comes to mind when thinking about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is probably the most commonly 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 is applied to the total cost of installing solar panels, including the panels themselves as well as labor, accessories and equipment. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence located in the United States that you own. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum claim amount.
Speaking with your local Riverside solar panel installation expert is the best way to learn more about how the ITC may apply to you.
In August 2022, the ITC (now titled the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. The Clean Energy Credit has increased the current credit up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. After 2032, the percentage will see a slight decrease annually until the program expires in 2035. The expansion also makes credits for energy storage systems even easier to claim, beginning in 2023.
Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit applies to you, talk to your local Riverside solar installers.
State & Local Solar Incentives
Rebates, tax credits and more can be provided at multiple levels. Along with federal solar incentives, there are often state and local ones, too. Certain incentives are ongoing, while others may only be available for a limited time. Incentives might be offered by the California government, or by your county or municipality.
Next Steps for Installing Solar in Riverside
The variety of solar incentives available has enormously increased the use of solar power nationwide over the last 15 years. You may receive solar incentives from your local utility company, the federal government or the California government. We recommend talking to your local Riverside solar installer to learn more about these incentives and to be sure that you're getting all of the money you can for your solar system.
EcoWatch's Riverside, CA Solar Incentives FAQs
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