California is the leading state in the US when it comes to solar power. With approximately 3055 hours of sunshine a year, there is enough for everyone. But that’s not all. California has some incredible incentives that makes the question “are solar panels worth it?” irrelevant.
Here are the top five incentives for California homeowners to go solar:
#1: Property Tax Exclusion for Solar Energy Systems
The property tax incentive for the installation of an active solar system is in the form of a new construction exclusion. When you do any upgrades to your home, such as major construction or adding something of value to the property, it usually comes with a reassessment of your home’s current market value. The increased value will then be added to the existing base year value – increasing your property tax. However, California offers a property tax exclusion for qualifying new solar installations. In short that means that if you install qualifying residential solar panels on your home before the expiration date on January 1, 2025, your property tax will not increase.
#2: The Investment Tax Credit (ITC)
We have covered this topic before, and that is because this incentive is time sensitive! The investment tax credit (ITC) is decreasing yearly until its end in 2022, which means the sooner you go solar, the more money you will save. If you purchase and install a solar system before the end of 2020, you can deduct 26% of the total value of your solar panel investment from your federal taxes. If you wait until next year, the tax credit will drop to 22% – and in 2022, there is no longer any credit to take advantage of.
The ITC allows homeowners to save thousands of dollars when turning their houses into solar homes. For example, if you purchase a solar system for $20,000, you will save $5,200 with the ITC.
#3: Net Energy Metering (NEM)
With this program, California solar owners can sell their excess solar energy to the grid and receive a credit on their electricity bill matching the rate they would have paid for that electricity. In fact, NEM is mandatory in California, which makes solar panels for homes a very valuable investment for homeowners who want solar power to reduce their electricity bill.
#4 Local Incentives
California has been the leading state when it comes to renewable energy for quite some time, and many cities state-wide have offered their own rebate programs for solar. While many of those offers have now expired, some are still very much active. An example is the city of San Francisco’s GoSolarSF program. As the name implies, the city is encouraging its inhabitants to go solar – and the reward is a one-time cash amount.
#5: Self Generation Incentive Program (SGIP) Home Battery Rebate
Especially for homeowners in California, battery storage is becoming more and more popular. With many of us working from home full time due to COVID-19, we rely on having power and internet without disruptions. But wildfires and other natural disasters are unfortunately common in The Golden State and can cause power outages. With battery storage, homeowners can store any excess power produced by their solar system and access this surplus energy in times of need – in the case of an outing, or to save money when the electricity prices are at their highest). In addition to the peace of mind battery storage brings, Californians have access to rebates for almost all solar battery storage projects thanks to SGIP.
With all these incentives, homeowners in California have multiple reasons to go solar now. If you are considering going solar and/or purchasing battery storage, contact us to help you get the best deal possible. Solar Optimum is ranked among the best solar panel companies in California with 12 years of serving our local communities.
