2024 Solar Incentives Guide for Berkeley, CA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Berkeley.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Berkeley?
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 propertyThe 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
Commercial/Multifamily Incentives:
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
Source: https://www.dsireusa.org/
Solar incentives are meant to help mitigate the cost of installing a solar panel system on your home. These financial incentives are designed to encourage more Americans to switch to renewable energy. Solar incentives may include upfront discounts, cash back or monthly credits towards your utility bill. Some incentives are offered by the federal government, some by the state of California and some by your utility company, county or municipality. Types of solar incentives might include:
- Rebates: Solar companies may help you claim a rebate, or partial refund of your purchase, for your solar panels. Counties or states will also offer limited-time rebates at various times. The value of a rebate will usually be deducted from your total price before tax credits are calculated.
- Net Metering: You can sign a net metering contract with your Berkeley utility company that will apply to all or a percentage of the excess electricity your solar panels generate. They will then deduct this value from your utility bill each month.
- Tax Credits: Tax credits reduce, dollar-for-dollar, the amount of income tax you owe the federal government. Tax credits are different from tax deductions.
- Tax Exemptions: Your solar panels could qualify for both sales tax and property tax exemptions. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to exclude the value added by your solar panels when you are calculating property taxes on your home.
- Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce more than a predetermined (usually small) amount of electricity can qualify for SRECs or similar performance-based incentives. SRECs and similar incentives are typically offered at the state level. You can sell SRECs to your utility company or another buyer, and generally the money you make is normally considered part of your taxable income.
Best Regional Coverage
Momentum Solar
- Great warranty coverage
- Representatives are experts on local policies
- Concierge service ensures steady communication
- Slightly limited service offerings
Best for Leasing
Sunrun
- Expansive service area
- Many financing options
- Some reported issues with customer service
- Some reported issues with door-to-door sales
Best Social Impact
Palmetto Solar
- Expansive service area
- Makes charitable contributions
- Certified B Corp
- No leases or PPAs
- Quality of installation may vary by location
Federal Solar Incentives
When people think of 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 certain percentage of the cost of your solar system.
The ITC applies to solar panels installed on your primary or secondary residence in the United States. The solar panels have to have been installed on a property you own after January 1, 2006, for you to be eligible for the credit. The ITC initially covered 30% of all system costs (panels, accessories, equipment and labor), although the amount has fluctuated slightly over time between 26-30%. The amount you qualify for will depend on when your solar system was installed. There is no cap on the amount you can claim.
To understand exactly how much money the ITC could save you, contact your local Berkeley solar panel installer.
In August 2022, the ITC (now referred to as the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. The Clean Energy Credit lasts until 2035. Any solar installation project that is completed between January 1, 2022, and December 31, 2032, may qualify for a 30% tax credit. This amount will then decrease slightly on a yearly basis until the current program ends. Beginning in 2023, it will also be easier to claim credits for energy storage systems under this new program.
More information about the new Inflation Reduction Act can be found here. The best way to learn more about how the new Clean Energy Credit will apply to you is to speak with your local Berkeley solar panel installers directly.
State & Local Solar Incentives
Federal solar incentives are not your only option; rebates, tax credits and more are often offered at the state and local level. The incentives — which might be provided by the state of California, or by your county or municipality — could be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Berkeley
Nationwide solar energy use has gone up significantly in the last 15 years, in part thanks to the growth in the number of solar incentives. You can obtain these incentives from your local utility company, the federal government or the California government. We recommend talking to your local Berkeley solar installer to learn more about these incentives and to make sure that you're getting all the money you can for your solar panels.
EcoWatch's Berkeley, CA Solar Incentives FAQs
My home already has solar panels. Does my system qualify for any incentives?
If your solar panels were installed after January 1, 2022, you may qualify for the newly increased 30% tax credit under the Inflation Reduction Act. If you installed your system between 2006 and 2021, you might qualify for a tax credit between 26% and 30%, depending on the date of installation. Reaching out to the company that installed your solar system, or any local Berkeley solar installer, can help you understand what incentives you qualify for.
How much can I save annually on my electric bill if I install solar panels on my house in Berkeley?
When you add solar panels to your Berkeley home, you can expect to save about $1,749.02 per year, or about $33,231.29 over the next 20 years.
What are some environmental benefits of adding solar panels to my house?
You can lower your carbon footprint by 250 pounds of CO2 a year when you switch to solar panels. This adds up to around 5,000 pounds in 20 years. Solar is also a renewable energy source, meaning that switching your home over reduces the drain on our planet's resources.
Can I use a combination of multiple types of renewable energy to power my home?
You can use multiple types of renewable energy, or a combination of renewable and non-renewable energy, to power your home. Be sure to talk through your plan with your local Berkeley solar installer. They can help you plan your project and also help you understand the various incentives that you might or might not qualify for.
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.