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June 4, 2019
If you’ve had your eye on solar energy here in California at all in the last decade, you may have heard about the California Solar Incentive program, or the CSI. This program was designed to incentivize the installation of 2,000 megawatts of solar photovoltaic (PV) systems for homes and businesses by offering big savings on the expected and actual performance of solar PV systems throughout the state.
The good news is that it worked — really well. The bad news is that it worked so well that the California Solar Incentive has now been exhausted and is no longer available. But that doesn’t mean you can’t still take advantage of government offered savings and incentives here in California with the local guys and gals at Greiner — as long as you hurry! The remaining offered solar incentives here in California are going the way of California Solar Incentive — away!
The Federal Investment Tax Credit in 2019
Back in 2006, the Federal Government put the Federal Investment Tax Credit (also known as the ITC) into effect. The ITC offers to reduce the cost of any residential or commercial solar installation by 30%, by allowing for a deduction totaling 30% of the cost of installation from the owner’s federal taxes.
The basic math is for every $10,000 you spend on your solar installation, you can deduct $3,000 from what you owe the Federal government come tax season. This is an unlimited incentive, so if you spent $25,000 installing a custom solar PV system, you could deduct $7,500 from your taxes and so on. The Federal ITC also allows one year of rollover on that deduction, so if your federal taxes add up to less than that 30% deduction, you can save the remainder for use the next year.
But even after an extension in 2015, the Federal ITC is now in its final year of full value. If your solar installation ends after December 31, 2019, the deduction drops to just 26% for the year 2020. It continues to drop in 2021 down to 22%, and then 2022 is the final year at a 10% deduction. This is why 2019 is the year to go solar.
The State of Net Metering in California
The State of California requires all electric utility companies offer net metering to their customers, in order to utilize the excess electricity your newly installed solar system will generate. During the daytime, your solar panels will more than likely convert more electricity than your home can use. So that extra electricity is sent back to the grid, for use in other homes. In exchange, your utility company will buy back that energy as a credit on your electricity bill, which can often offset the cost of the electricity you use overnight while the sun is down.
PACE Financing in California
Property Assessed Clean Energy financing, also known as PACE, is an innovative and popular way for homeowners to spread the cost of their solar installation over the course of up to 30 years. The innovative aspect of PACE financing is that the payments are paid as a line item on your property taxes. This allows you to contribute to the clean energy initiative here in California, without having to front the tens of thousands of dollars it can cost to install solar panels!
The Bright Future of Solar in California
As of the year 2020, any new homes built in California will be required to include a solar PV system, and by the year 2045 California has plans to be 100% powered by clean energy. It is pretty clear — solar energy is no fad; it is here to stay! So if you are looking to get ahead of the game and take advantage of the remaining California solar incentives before they are gone, get in touch with the solar experts at Greiner. We have installed custom designed, highly efficient solar PV systems throughout Davis, Dixon, Vacaville, and Woodland, CA, and we are here to make sure you don’t spend a penny more than you need to when it comes to your solar installation.