2025 Solar Incentives Guide for Santa Clara, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Santa Clara.
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.
Get a free quote from one of our trusted Santa Clara solar installers to see how much you can save.
Please enter a valid 5-digit zip code!
Why you can trust EcoWatch
What Solar Tax Credits, Incentives, and Rebates are Available in Santa Clara?
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
Santa Clara Water & Sewer - Solar Water Heating Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives help mitigate the cost of installing a solar panel system on your home. This category of financial incentives is in place to encourage more people to make the switch to renewable energy. The incentives may include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are given by the federal government, some by the state of California and some by your utility company, county or municipality. Categories of solar incentives include:
- Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar panels. These may be offered by your local utility company, your county or your state. The cash back that you get from the rebates is normally applied before calculating tax credits.
- Tax Exemptions: Tax exemptions can come in one of two forms. The first is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption. This allows you to exclude the value added by your solar system when calculating property tax for your house.
- Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce over a threshold (generally small) amount of electricity qualify for SRECs or other similar performance-based incentives. SRECs and performance-based incentives in general are typically offered by your state government. You can sell SRECs to your utility company or another buyer, and this is usually considered part of your taxable income.
- Tax Credits: Tax credits lower, dollar-for-dollar, how much income tax you owe the government. These are different from tax deductions.
- Net Metering: You can sign a net metering contract with your Santa Clara utility company. This agreement may apply to all or a percentage of the excess electricity your solar panels generate. They will then subtract this value from your utility bill each month.
Federal Solar Incentives
Federal solar incentives are likely to be the first thing that comes to mind when thinking about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is the most well-known federal solar incentive. The ITC provides a tax credit for a specific percentage of the cost of your solar system.
The ITC applies to solar systems installed after January 1, 2006, on a primary or secondary residence in the United States that you own. Initially, the credit applied to 30% of the total cost – for panels, labor, accessories and equipment – although it may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the claim amount.
Your local Santa Clara solar panel installation expert can give you more information about the ITC and how it may apply to your situation.
In August 2022, the ITC (now referred to as the Clean Energy Credit) was expanded and extended by the passage of the Inflation Reduction Act. The Clean Energy Credit lasts until 2035. Solar installation projects started after January 1, 2022, and completed by the end of 2032 may qualify for a 30% tax credit. This amount will be decreased slightly on a yearly basis until the current program ends. The expansion also makes it easier to get credit for energy storage systems, beginning in 2023.
Click here to learn more about the new Inflation Reduction Act. Your local Santa Clara solar panel installation experts can answer your questions and explain how the new Clean Energy Credit applies to you.
State & Local Solar Incentives
Some solar incentives may be provided at the state and local level. Similar to federal incentives, these may include rebates, tax credits and more. These incentives may be offered by the California government, or by your county or municipality. Certain incentives are ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Santa Clara
You can qualify for solar incentives from the California government and the federal government, as well as from your local utility company. This increase in availability of solar initiatives in the past 15 years has helped increase nationwide solar energy use enormously. Reaching out to your local Santa Clara solar panel installer is an excellent first step towards making sure you get all the incentives you qualify for when you switch to solar energy.
EcoWatch's Santa Clara, CA Solar Incentives FAQs
I already have solar panels. Are there any incentives that I qualify for?
If your solar panels were installed after January 1, 2022, you may qualify for the newly increased 30% tax credit under the Inflation Reduction Act. If you installed your system between 2006 and 2021, you may qualify for a tax credit between 26% and 30%, depending on the year it was installed. Reaching out to the company that installed your solar system, or any local Santa Clara solar installer, can help you understand what incentives you can apply for.
What are the top solar panel installation companies near me?
To find a top-rated solar panel installer, check out our guide to the top solar companies in Santa Clara.
If I trade in my appliances for ones that can utilize solar energy, are there incentives that I can claim?
Under the new Inflation Reduction Act, there are a variety of new financial incentives to encourage you to make eco-friendly improvements to your home. More details about these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I use a combination of solar and another type of renewable energy to power my home?
You can use multiple types of renewable energy, or a combination of renewable and non-renewable energy, to power your home. Make sure you talk through your ideas with your local Santa Clara solar installer. They can help you plan your project and also help you understand the various incentives that 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.