California Solar Rebates and Incentives
Solar Rebates and Incentives for the Monterey, Santa Cruz and Salinas Area
California is the number one state in the country for solar energy thanks to the copious amount of sunshine we receive throughout the year. But that’s not the only reason to go solar in California—the Golden State also offers some of the best solar incentives.
California solar rebates and incentives can help you manage the upfront costs of solar installation and provide you with long-term financial benefits. Premo Solar is here to help you take advantage of the excellent solar incentives CA has to offer. We’ll determine which incentives your project qualifies for and walk you through the application process. Premo Solar is committed to making solar affordable in California, and we also offer financing.
|Solar Incentive||Overview||Who’s Eligible?|
|Investment Tax Credit (ITC)||All solar systems installed in CA are eligible for the ITC, a federal tax credit worth 26% of the solar system’s cost.||Available for residential and commercial solar projects.|
|Modified Accelerated Cost Recovery System (MACRS)||A method of depreciation that allows businesses to recover a portion of solar installation costs over a one-year or five-year period.||Available for commercial solar projects.|
|Net Energy Metering||An incentive that allows solar customers to trade energy with their utility.||Available for residential and commercial solar customers of participating utilities.|
|Solar Energy System Property Tax Exclusion||This incentive ensures property taxes will not increase due to a solar installation.||Available for residential and commercial solar projects.|
|Self-Generation Incentive Program||This incentive program allocates rebates to customers who install solar and battery storage technologies in high wildfire threat areas or for medically vulnerable customers.||Available for select residential solar customers and commercial solar customers of participating utilities.|
The Solar Investment Tax Credit
The Investment Tax Credit (ITC), also known as the federal solar tax credit, is the best solar incentive available in the US. The solar tax credit in 2022 allows you to claim a federal tax credit worth 26% of your solar system’s total installation costs. The incentive is available for both residential and commercial solar projects.
The solar tax credit is currently on a step-down schedule and will be reduced to 22% in 2023 and eliminated for homeowners in 2024. At this time, a 10% tax credit will be available indefinitely for commercial solar projects. To qualify for the 26% credit, your solar system must be fully installed and turned on by December 31, 2022. Don’t miss out! Schedule your solar installation with Premo Solar today.
Modified Accelerated Cost Recovery System (MACRS)
MACRS depreciation allows businesses to recover some of the costs associated with commercial solar installation. Qualifying solar energy equipment is eligible for a five-year cost recovery period.
Businesses can qualify for both the ITC and MACRS. However, if you claim the ITC, you must reduce the project’s depreciable basis by half of the value of the ITC. Residential solar does not qualify for MACRS.
If you install commercial solar before 2023, you can qualify for Bonus Depreciation, allowing you to allocate 100% of the depreciable value of the asset in the first year.
Net Energy Metering
Net energy metering is a long-standing solar incentive in California that allows solar users to sell the excess electricity their systems generate to their utility companies in exchange for a credit. Those credits can be used to pay for grid-generated electricity at night and any other time your panels are not producing enough electricity.
Recently, significant changes have been proposed to net metering in California. The program would be renamed “net billing” and changes would include mandatory time-of-use billing for all solar customers, a monthly Grid Participation Charge for most residential customers, and Market Transition Credits to offset the cost of the new Grid Participation Charges.
As of February 2022, these changes have not been implemented. Premo Solar strives to provide updated information on all important solar news. If you have any questions about the current state of net metering in California and how it will affect your solar installation, please don’t hesitate to contact us.
Active Solar Energy System Property Tax Exclusion
Solar panels can significantly increase the value of your home, but don’t worry—they won’t increase your property taxes. Active solar energy systems, which include residential solar panels and battery storage, are not included in California property tax assessments. This statute is in effect until January 1, 2025.
Self-Generation Incentive Program (SGIP)
SGIP offers rebates for installing solar energy generation and storage technologies at residential and non-residential facilities in California. Customers of PG&E, SCE, SoCalGas, and SDG&E are eligible to receive rebates through the SGIP.
In preparation for the next wildfire season, additional funding has been allocated to SGIP. This funding will prioritize customers who live in high fire-threat areas or have experienced two or more Public Safety Power Shutoff (PSPS) events. Low-income customers, medically vulnerable customers, and critical facilities will also be prioritized.