California Solar Incentives & Rebates (2026)
Stack the 30% federal credit, SGIP battery rebate, and California's property-tax exclusion to lower the all-in cost of a new solar + battery system.
30% Federal Residential Clean Energy Credit
The Section 25D Residential Clean Energy Credit is the largest single incentive available to California homeowners. It equals 30% of the total installed cost of solar panels, inverters, balance-of-system, labor, permitting, and qualifying battery storage. There is no cap.
- Eligible: primary residence and second homes you own.
- Includes: standalone batteries (≥ 3 kWh) starting in 2023.
- Excludes: leased systems and PPAs (the lessor claims it).
- Carryforward: any unused credit rolls forward to future years.
SGIP — Self-Generation Incentive Program
SGIP is California's per-kWh rebate for energy storage. The program is divided into tiers based on your address and household characteristics:
| Tier | Eligibility | Approx. rate |
|---|---|---|
| General Market (Step 7) | Most homeowners | ~$150 / kWh |
| Equity | Low-to-moderate income | ~$850 / kWh |
| Equity Resiliency | Equity + Tier 2/3 fire risk OR PSPS history | ~$1,000+ / kWh |
SGIP is California's per-kWh rebate for energy storage. The program is divided into tiers based on your address and household characteristics:
DAC-SASH — Disadvantaged Communities SASH
DAC-SASH provides no-cost solar to qualifying low-income households living in the top 25% of disadvantaged California communities (per CalEnviroScreen). The program covers system cost, installation, and a 10-year warranty. Income limits and community designation apply.
Property Tax Exclusion (R&T Code §73)
California’s active solar energy system exclusion prevents county assessors from including the value of a new solar system in your home’s assessed value. In short: your property taxes do not go up because you installed solar. Battery storage installed as part of a qualifying solar system is generally included.
Net Billing export credits (NEM 3.0)
Not technically a “rebate,” but the export credits you earn under the Net Billing Tariff are real value. See our complete NEM 3.0 guide for the avoided-cost windows and how to design around them.
Utility-specific programs
- PG&E Energy Education Initiative: free home energy assessments and TOU rate plan analysis.
- SCE TOU Plan Pilot: bill protection during your first year on a TOU rate to ensure you don’t pay more.
- ESoCalGas Heat Pump Rebates: if you electrify water/space heating alongside solar, you can stack appliance rebates separately.
Worked example: stacking incentives
Bakersfield homeowner installs a 7.2 kW solar + 13.5 kWh battery system with a sticker price of $42,000:
| Step | Value | Net cost |
|---|---|---|
| Sticker price | — | $42,000 |
| SGIP General Market (~$150/kWh × 13.5) | −$2,025 | $39,975 |
| 30% Federal Tax Credit | −$11,993 | $27,983 |
| Property tax exclusion | $0 added to assessment | $27,983 |
That same install in an Equity Resiliency zone could see SGIP push the net cost below $15,000.
The self-consumption strategy
Under NEM 3.0, every kWh you consume on-site is worth full retail value (~$0.30–$0.55/kWh), while every kWh you export is worth avoided-cost (~$0.05–$0.08/kWh outside peak). The rational play:
- Size your system to match your annual usage (no oversizing).
- Add a battery sized to cover your evening 4–9 PM load.
- Move flexible loads — EV charging, dishwasher, pool pump — into midday hours.
- Pre-cool your home from 1–4 PM, then ride the battery through peak.
Maximize your stack
Incentive eligibility is checked address-by-address. We pull your SGIP tier and confirm CSI/DAC zone status during your free design so you know exactly what you qualify for.
See related guides: battery sizing, financing options, and the install process.
Discount Solar Solutions is not a tax advisor. Consult a licensed CPA for guidance on your specific tax situation.
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More resources for California homeowners
California's net billing tariff cut export credits by roughly 75%. Here's how to get a fast payback anyway — and why batteries are now part of the answer.
Everything California homeowners need to size, choose, and finance a solar battery in 2026 — from kWh math to backup loads to brand trade-offs.
Decode every line on your PG&E or SCE bill — and learn exactly what the numbers will look like after your solar system is granted PTO.
What actually happens between signing your proposal and switching your system on. Real timelines, paperwork, and what we handle for you.
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