What are the Direct Homeowner Incentives for Solar?

Identifying the direct homeowner incentives for solar feels like second nature when you work in the industry – here at Simply Solar, we spend a lot of time researching and strategizing around every available benefit opportunity in order to help customers make the most of their solar investment. Because we’re immersed in the industry every day, these rewards opportunities are almost second nature to us, but for many California residents, the direct homeowner incentives of solar get lost in the noise. Today, we’re going to break down some of the direct homeowner incentives for solar, and hopefully simplify the prospect of installing and benefiting from solar.

There are many direct homeowner incentives for installing solar on your home or property, including monthly energy savings, property value increases, and resilience to outages. Additionally, there are a number of federal and state incentive programs designed to directly benefit homeowners who invest in solar.

Before we dig into the many real and tangible benefits of solar, there is one myth that we have to clear up: there is no such thing as “Free Solar”. It is an unfortunate reality of every industry that there will inevitably be a few grifters who want to take advantage of public interest to make a quick buck. Companies touting Free Solar are simply trying to take advantage of unsuspecting customers to profit one way or another, and it hurts the entire community by creating disinformation which devalues the legitimate benefits of solar.

So, let’s put that myth to bed once and for all – the government will not give you free solar. What the government will do is provide you with multiple incentive opportunities, which if taken advantage of, can help you significantly reduce the cost of your investment. We’re talking about things like the 30% tax credit for solar, the extensions of that same program to battery storage and EV investments. Even the many green energy programs designed to help you invest in high-efficiency electric appliances. These are the kinds of direct homeowner incentives you can expect from the government, and they do make a big difference in the cost of a solar investment. Just don’t fall for the scam of “Free Solar” – it’s just a big distraction.

There are honestly so many different incentive programs that it can be hard to keep track of them all – even if you’re an industry veteran! Luckily for you, our expert solar consultants are incentive pros, and will help you track down and take advantage of all the direct homeowner incentives on the market. However, we like to focus our attention on a handful of key incentives which are easy to understand and most directly communicate the benefits of solar to a California homeowner: The Solar Investment Tax Credit, Property Value Increases, Energy Bill Reduction, and Solar Resiliency.

The Solar Investment Tax Credit

Of all the direct homeowner incentives for investing in solar energy, the Solar Investment Tax Credit is perhaps the most widely known. However, for those who have not heard about this primary value driver for solar investments, the ITC is a 30% tax credit based on the cost of your system. This includes expenses associated with the installation of the system, including contractor costs, panels and cells, battery storage, and sales tax.

From now until 2032, homeowners will be able to apply this tax credit during the tax season that pertains to the year in which the system was purchased by recouping 30% of the system cost as tax relief. For some, this will represent an incredible savings opportunity, effectively making every solar system 70% of the actual sticker cost, but there are those who do not have a tax burden sufficient enough to utilize the credit. Luckily, there are financing options that can help you realize the value of the tax credit even with a low tax burden. A solar consultant can help you make the most of this credit when you meet to discuss your solar system.

Property Value Increase

The property value increase of solar is something of a sleeper hit, but the moment you decide to sell your home, you’ll see just how impactful this can be. In fact, the property value increase gained by installing solar may be one of the most valuable direct homeowner incentives on the list, depending on the housing market in your area. Based on a study done by the Lawrence Berkeley National Laboratory in conjunction with the US Department of Energy, we estimate that you can increase your property value by $4000 to $6000 per kWh of electricity generation you have installed.

So, if you were to install a 6 kW system, you could expect to see your property value increase by roughly $24,000 to $36,000 dollars! Now, market and location will have an impact on these values, but we’ve seen consistent interest in solar-enabled homes which support this study. This is one of the elements of solar that marks it as a sound investment – the ability to both reduce the cost of the system on the front end with the tax credit, and then recoup additional financial rewards if you decide to sell your property! This will of course depend on you deciding to sell your home, but the value is baked into the property for whenever that decision is made.

Energy Bill Reduction

Reducing customer energy bills is the bread and butter of solar – this is what usually brings people to the table in the first place. As far as direct homeowner incentives are concerned, when you see your energy bill growing larger month over month, it’s easy to begin imagining a world where you don’t owe hundreds of dollars a month to the utility. Not to mention the baffling, frustratingly frequent rate hikes proposed seemingly multiple times a year – California residents are likely beginning to feel a little penned in by these looming expense monsters.

Solar provides a really simple solution to that problem: what if you paid less for power? What if you were part of the production process? What if you could stop renting your power, and instead invest in energy independence? Solar is an end date to your energy bill, an opportunity to drastically reduce your monthly energy bills, and to insulate yourself from market volatility and price increases. By working with a consultant to design a system that fits your needs and budget, you can say goodbye to your utility bill woes.

Solar Resiliency

One key value add of solar which isn’t always a first consideration for customers is the resiliency of solar. When we think of direct homeowner incentives, we often consider tangible financial benefits, which makes sense – that is where the pain points are for most homeowners on a month to month basis! But once fire season rolls around for California, people start to more actively consider the safety and security of their home. For those of us with important medical or survival equipment on site, this becomes an even more pressing concern.

With a solar + storage installation, you don’t have to worry when the lights go out. Active users will be able to regulate their energy consumption and continue to power their critical equipment long after the grid goes down. For some, this represents a matter of convenience and saving, but for others, that could make all the difference. Consider your energy needs at the moment, and then consider what energy usage you cannot live without. That is where your solar system can and will provide the most direct incentive of all.