Solar Power Just Got More Affordable
The solar industry is booming in California, with more than a quarter of its electricity coming from this renewable source. The state is ranked first nationally for solar energy in 2022 and has seen prices falling 50% over the last decade, making it a more affordable option for residential electricity. California solar is vital to the state’s work to achieve its climate and energy goals.
To help consumers reduce the price of solar power even more, the state and federal governments offer many solar incentives. These, paired with future expected utility bill savings and positive environmental impact, make solar power an attractive investment for Californians.
Continue reading to learn more about some of the incentives available for California solar power.
Property-Assessed Clean Energy (PACE)
PACE residential and commercial programs are available to residents of California. The California Enterprise Development Authority (CEDA) and California Statewide Communities Development Authority (CSCDA) have active programs with funded projects.
Both programs work to provide long-term, low-interest rate funds with no money down for property owners’ investments in clean energy improvements. Later, the money is repaid on the property owner’s tax bills.
The benefits of completing PACE improvements are:
- Higher real estate values.
- Lower monthly energy costs.
- Other tax incentives.
Property Tax Exclusions for Solar Panel Installations
Investing in solar system for home is a significant home improvement, typically resulting in higher property taxes; however, Section 73 of California’s revenue and taxation code allows for excluding solar improvements from property tax calculations. This exclusion will be in effect through January 1, 2025.
The Federal Investment Tax Credit (ITC)
The federal government also wants to reward environmentally conscious decisions with tax incentives. For example, the ITC solar incentives allow homeowners who purchase their PV system to claim and deduct 26% of their solar installation costs from their federal taxes. After growing the US solar power industry by more than 10,000% since its inception, the ITC will begin to phase down over the next two years, so be sure to take advantage of this program while you still can.
Net Energy Metering
When you install a PV solar panels for homes, your system may generate more energy than your home will consume. Net energy metering (NEM) allows this excess energy to be shared with the utility and put into the power grid.
Owners who contribute this way receive credit on their energy bills for the electricity they supply to the utility. Participating in this program is mandatory for California solar users.
California is doing its part to work toward a clean and renewable energy future. As the cost of solar power is reduced by increased demand, greater supply, and supporting incentives, we expect to see the solar market in California continue its growth well into the future.
With all of these great incentives, is it time for you to consider an investment in solar?