2023 Solar Incentives Guide for Santa Clarita, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Santa Clarita.
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 Clarita?
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 designed to make renewable energy usage more affordable via financial incentives for individuals who install solar panels on their homes. Different kinds of incentives, including cash back, discounts or monthly utility bill credits, may be available to you. Some incentives may be handled by the state of California, by your utility company or by county or municipality, while others are federal. You might qualify for any of the following types of solar incentives:
- Tax Exemptions: Sales tax exemptions are applied at the point of sale for your solar system. Property tax exemptions allow you to ignore the value added by your solar system when you're calculating how much property tax you need to pay on your house.
- Net Metering: Make sure you speak with your Santa Clarita utility company about signing a net metering agreement. This will allow you to receive credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You could receive either a dollar-for-dollar credit or a percentage of the value.
- Rebates: Rebates, or partial refunds after a purchase, are usually given before any solar tax credits are calculated. These rebates might be offered by your local utility company, by your state or by your county.
- Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives might be available to you if the solar system on your home produces more than a specified (generally small) amount of electricity. These types of incentives are usually handled by the state government. You can sell the SRECs you receive to your utility company or other buyers, and the money you make is typically considered part of your taxable income.
- Tax Credits: Tax credits lower, dollar-for-dollar, the total amount of tax you owe the government. These are different from tax deductions.
Federal Solar Incentives
When people think of solar incentives, federal incentives might be the first thing that comes to mind. You might have heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit that reduces your taxes by a predetermined percentage of the money you spend on solar panels for your home.
The ITC can be applied to the total cost of installing a solar system, including the panels themselves as well as equipment, accessories and labor. You can claim this credit for panels installed after January 1, 2006 on a primary or secondary residence that you own and that is located in the United States. The tax credit ranges from 26-30% of total costs depending on when your project was completed. There is no maximum amount you can claim.
Your local Santa Clarita solar panel installation expert can offer more information about the ITC and how it might apply to your situation.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now called the Clean Energy Credit. The new Clean Energy Credit now runs until 2035. Homeowners can now receive a 30% credit for solar systems installed between January 1, 2022 and December 31, 2032. The total credit will then be decreased by a few percentage points every year until it expires. Beginning in 2023, it will also be easier to claim credits for energy storage systems under the new laws.
More information about the new Inflation Reduction Act can be found here. The best way to fully understand how the new Clean Energy Credit will apply to you is to talk with your local Santa Clarita solar panel company.
State & Local Solar Incentives
There are often also state solar incentives in addition to those provided by the federal government. Tax credits, rebates and more can be offered at a more local level. Incentives may be given by the state of California, or by your county or municipality. Some incentives might only be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Santa Clarita
Solar incentives can be provided by your local utility company, the federal government or the California government. The large number of available incentives has facilitated the nationwide growth of solar energy use in the last 15 years. Speaking with your local Santa Clarita solar panel installation expert is the right first step towards getting the most money possible when you switch to solar energy.
EcoWatch's Santa Clarita, CA Solar Incentives FAQs
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