Solar Incentives in California
Last updated: March 2026
Avg. sun hours/day
5.5 hrs
Avg. electricity rate
$0.25/kWh
Active incentives
3
Active Programs (3)
Self-Generation Incentive Program (SGIP)
Approximately $200 per kWh of battery storage capacity for residential customers in high fire-threat districts. Base incentive is $150/kWh; equity and equity resiliency tiers provide higher amounts.
SGIP is funded by California utility ratepayers and administered by PG&E, SCE, SoCalGas, and SDG&E. Priority is given to customers in Tier 2 and Tier 3 high fire-threat districts and low-income households. The program has multiple budget steps; incentive amounts decline as each step is exhausted. Check current step availability with your utility.
Net Energy Metering 3.0 (NEM 3.0)
Exported solar energy is compensated at avoided-cost rates, averaging approximately $0.05 per kWh. This is significantly lower than NEM 2.0 retail-rate credits.
NEM 3.0 took effect April 15, 2023 for new applicants under PG&E, SCE, and SDG&E. Export compensation varies by time of day using an Avoided Cost Calculator (ACC) rate. Average export value is ~$0.05/kWh compared to ~$0.30/kWh retail under NEM 2.0. Systems paired with battery storage are strongly advantaged under NEM 3.0, as batteries allow shifting consumption to offset high-rate evening periods rather than exporting at low avoided-cost rates. Customers on NEM 2.0 are grandfathered for 20 years from their interconnection date.
California Solar Property Tax Exclusion
Full exclusion of the added assessed value attributable to a qualifying solar energy system. No monetary cap on the exclusion amount.
Under California Revenue and Taxation Code Section 73, new solar energy systems are excluded from property tax reassessment. The exclusion applies to the full value added by the solar installation. The current exclusion is authorized through the 2026–27 assessment year. Battery storage systems installed in conjunction with solar also qualify.
Expired / Historical Programs
California Solar Initiative (CSI)
Program is fully subscribed and closed. Historically provided $0.25–$1.90/W depending on system size and utility territory. No longer accepting applications.
The CSI program was the largest solar incentive program in US history, running from 2007 to 2016. It is fully closed. Listed here for historical reference only — no incentive is available through this program.
Federal Residential Clean Energy Credit (ITC) — EXPIRED
This credit has expired for new residential solar installations. It was worth 30% of the total system cost with no cap.
The federal Residential Clean Energy Credit (formerly the Investment Tax Credit, Form 5695) expired for new installations as of January 1, 2026. Systems installed and placed in service on or before December 31, 2025 may still claim the 30% credit on the applicable tax return. California homeowners installing solar in 2026 or later are NOT eligible for this federal credit. The Commercial Solar ITC at 30% remains active for businesses.
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