2023 Solar Incentives Guide for Santa Ana, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Santa Ana.
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 Santa Ana?
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
The term "solar incentives" covers a wide range of financial incentives put in place to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. You may qualify for various types of incentives, such as discounts, cash back or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the California government and others from the federal government. Some solar incentives you might qualify for are:
- Rebates: Rebates, or cash back after a purchase, are typically given prior to any solar tax credits being calculated. Solar rebates may be provided by your local utility company, by your state or by your county.
- Net Metering: You may be able to sign a net metering agreement with your Santa Ana 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 subtract this value from your monthly utility bill.
- Tax Exemptions: These might come in the form of property tax exemptions, which can let you ignore the value of your solar system when calculating the taxes you pay on your home. You may also qualify for an exemption on sales tax at the time of purchase.
- 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 qualifies for SRECs or similar performance-based incentives. These kinds of incentives are typically handled by your state government.
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government. (A tax credit is different from a tax deduction.)
Federal Solar Incentives
Federal solar incentives are probably the first thing that you think of when you think about solar incentives. An incentive many people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a given percentage of your solar system's cost.
The ITC covers solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, equipment, accessories and labor. This credit can apply towards solar panels installed on a primary or secondary residence in the United States that you own. The original claim amount was 30% of the total cost, although certain projects may qualify for only 26%, depending on the details. There is no maximum amount you can claim.
Wondering how the ITC applies to your specific situation? Reach out to your local Santa Ana solar panel installation expert to get more information.
The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The new Clean Energy Credit extends until 2035. Homeowners can now receive a 30% credit for solar systems that began installation on or after January 1, 2022 and will be done by December 31, 2032. The total credit will then see a slight annual decrease until it expires. Beginning in 2023, it will also be easier to claim credits for energy storage systems with the new act.
More information about the new Inflation Reduction Act can be found here. The easiest way to understand how the new Clean Energy Credit will apply to you is to talk with your local Santa Ana solar panel installers.
State & Local Solar Incentives
Tax credits, rebates and more can be claimed at multiple levels. Along with federal solar incentives, there are often state and local ones, too. Incentives may be provided by the state of California, or by your county or municipality. Some incentives may be available for only a limited time, while others are ongoing.
Next Steps for Installing Solar in Santa Ana
Solar energy use nationwide has significantly increased in the last 15 years, in part thanks to the increase in availability of solar incentives. You can obtain these incentives from your local utility company, the federal government or the California government. Your local Santa Ana solar panel installation company can help you learn more about which incentives you may qualify for, and get you started on the path to switching to renewable energy today.
EcoWatch's Santa Ana, CA Solar Incentives FAQs
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