2024 Solar Incentives Guide for San Diego, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in 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 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
City of San Diego - Sustainable Building Expedited Permit Program
San Diego County - Green Building Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are meant to help mitigate the cost of installing a solar panel system on your home. Financial incentives like these are intended to encourage more homeowners to switch to renewable energy. Various types of incentives, such as discounts, cash back or monthly utility bill credits, may be available to you. Some incentives may be handled by the California government, by your utility company or by county or municipality, while other incentives are federal. Categories of solar incentives include:
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.
- Rebates: Solar rebates can be offered by your state or county, or by your local utility company. These rebates work as partial refunds that are applied after you pay for solar panels and before tax credits are calculated.
- Net Metering: Net metering is an incentive you can get after your solar system is up and running. If you have a net metering agreement in place with your San Diego utility company, the company 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 other areas you might be refunded a percentage of the value.
- 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 added value of your solar system when calculating the amount of property tax you need to pay.
- Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are typically handled by your state government. Once your solar system meets the qualification threshold (generally a small amount of energy production), you are eligible to receive SRECs that can then be sold to your utility company or other buyers. The money you receive from the sale is usually considered part of your taxable income.
Best National Provider
SunPower
- Most efficient panels on the market
- National coverage
- Cradle to Cradle sustainability certification
- Great warranty coverage
- Expensive
- Customer service varies by local dealer
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 you think about solar incentives, you probably think of federal incentives first. One of the incentives many people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a given percentage of the cost of your solar system.
The ITC applies to solar panels installed on your primary or secondary residence in the United States. The solar system must have been installed on a property you own after January 1, 2006, for you to be eligible for the credit. Initially, the ITC applied to 30% of all system installation costs (panels, labor, equipment and accessories), although this 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 claim amount.
Your local San Diego solar panel installation expert can provide you with more information about the ITC and how it may apply to your situation.
The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit re-raises the credit up to 30% for solar systems installed between 2022 and 2032. At this point, the credit percentage will see a slight decrease annually until the end of the program in 2035. Starting in 2023, the expansion to the program 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 San Diego solar panel company can answer any questions you have and explain how the new Clean Energy Credit will apply to you.
State & Local Solar Incentives
Rebates, tax credits and more might be provided at multiple levels. In addition to federal solar incentives, there are often state and local ones, too. Certain incentives are offered for only a limited time, while others are ongoing. Local solar incentives might come from the California government, or from your specific county or municipality.
Next Steps for Installing Solar in San Diego
You can receive solar incentives from the federal government and the California government, as well as from your local utility company. This increase in availability of solar initiatives over the last 15 years has helped increase nationwide solar energy use enormously. Contact your local solar panel installation expert today to learn more and to save the most money possible on a solar system for your San Diego home.
EcoWatch's San Diego, CA Solar Incentives FAQs
How do I learn if I qualify for solar incentives?
It's best to speak with your local San Diego solar installer to get an understanding of which incentives your project will qualify for. Usually, solar incentives apply to new solar panel systems installed on property you own (in the U.S.) within a specified date range. Some incentives, such as those provided at the level of the California government, may have additional requirements.
How much will a solar system save me on my electric bill in San Diego annually?
After adding solar panels to your home in San Diego, you can anticipate savings of approximately $1,637.07 per year, or around $31,104.39 over the next 20 years.
What are some environmental benefits of installing solar panels on my house?
Solar energy is renewable — by switching where you get your energy, you can help lessen the strain on our planet's resources. Solar panels can also lower the CO2 emissions from your home by 250 pounds annually, or roughly 5,000 pounds over 20 years.
Can I use solar and another type of renewable energy in combination to power my home?
Yes, you can employ multiple types of renewable energy to power your home, such as a combination of wind and solar. You can also combine renewable energy generation with a non-renewable backup source of energy. You should discuss your plan with your local San Diego solar panel installer, to get an understanding of what will be needed and what incentives you may or may 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.