2023 Solar Incentives Guide for Tehachapi, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Tehachapi.
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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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Tehachapi?
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 encourage homeowners to make the switch to renewable energy by offering incentives that lower the financial burden of solar panel installation and use. Different kinds of incentives, like discounts, cash back or credit towards your monthly utility bill, might be available to you. Some incentives may be provided via the California government, 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: These might come in the form of property tax exemptions, which would allow you to ignore the value of your solar system when paying taxes on your home. You could also look for exemptions on sales tax at the time of purchase.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
- Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives might be available to you if the solar system on your home produces over a specified (generally small) amount of electricity. These types of incentives are generally handled at the state level. You can sell any SRECs you have to your utility company or other buyers, and the money you make is normally considered part of your taxable income.
- Rebates: Solar rebates may be provided by your local utility company, or by your state or county. These rebates work as cash back that is applied after you purchase solar panels and before tax credits are calculated.
- Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you have in place a net metering agreement with your Tehachapi utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this is a dollar-for-dollar credit, while in other places you might get refunded a percentage of the value.
Federal Solar Incentives
When you hear the term "solar incentives," federal incentives might be the first thing that comes to mind. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a specified percentage of your solar system's cost.
The ITC applies to solar panels installed after January 1, 2006 on a primary or secondary residence that you own in the United States. Initially, the credit applied to 30% of the total cost — for panels, accessories, equipment and labor — although that amount may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the claim amount.
Reaching out to your local Tehachapi solar panel installer is the best way to learn more about how the ITC may apply to you.
The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit runs until 2035. Any solar installation project that is completed between January 1, 2022 and December 31, 2032 may qualify for a 30% tax credit; the amount will then decrease slightly on a yearly basis until the end of the current program. Beginning in 2023, it will also be easier to obtain credits for energy storage systems with the new act.
Click here to learn more about the new Inflation Reduction Act. To best understand how the new Clean Energy Credit applies to you, get in touch with your local Tehachapi solar installers.
State & Local Solar Incentives
Some solar incentives may be provided at the state and local level. As with federal incentives, these can include rebates, tax credits and more. Incentives may be provided by your county or municipality, or by the state of California. Some incentives might only be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Tehachapi
The expanding number of available solar incentives has contributed greatly to the increase in the use of solar power nationwide over the past 15 years. You can get solar incentives from your local utility company, the federal government or the California government. Speaking with your local Tehachapi solar panel installation expert is a great first step towards getting the most money possible when you switch to solar energy.
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EcoWatch's Tehachapi, CA Solar Incentives FAQs
What if I add solar panels to a rental property, vacation home or commercial property? Can I still qualify for incentives?
Many solar incentives apply to a property you own that is located within the United States, and most secondary residences will fall under this distinction. There may be other solar incentives available for commercial properties, depending on the details. We recommend talking to your local solar installer and/or tax professional to best understand what incentives may apply to your specific situation.
How do I learn if I qualify for solar incentives?
Generally, solar incentives apply to:
- a new solar system
- installed on property you own
- within the U.S.
- within the date range specified by a particular incentive.
Specific incentives, including those given out by the California government or by your county/municipality, could have additional qualifications. Talk to your local Tehachapi solar installer to find out what incentives your project may qualify for.
If my house already has solar panels, can I still claim incentives?
If your solar system was installed after January 1, 2022, you may qualify for the newly increased 30% tax credit under the Inflation Reduction Act. If your system was installed between 2006 and 2021, you may qualify for a tax credit between 26% and 30%, depending on the year it was installed. Speaking with the company that installed your solar system, or any local Tehachapi solar installer, can help you understand what incentives you can apply for.
I want to switch my appliances out for ones that are more energy-efficient. Are there any benefits I can claim?
The new Inflation Reduction Act introduces multiple incentives that reward homeowners who make eco-friendly upgrades. Some incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
Can I qualify for incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order your incentives will be applied in may vary depending on which incentives you are eligible for but typically yes, you can receive multiple types of incentives for your solar project. Check with your solar installer or a local tax professional to ensure you are claiming all the incentives you are eligible for and applying them in the correct order.
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.