California Clean Energy Incentive Programs
California's clean energy incentives run through the CPUC, CARB, the California Energy Commission, and the state's three major investor-owned utilities. The NEM 3.0 transition has made battery storage more valuable for new solar projects, and the SGIP program offers rebates to offset storage costs.
IncentEdge's verified catalog currently covers New York only. This page is general information about California programs that IncentEdge has not verified. Confirm current rules and amounts with each program administrator before relying on them. Federal credits apply in every state; see the federal credit guides.
Overview
California's clean energy incentive ecosystem is administered jointly by the California Public Utilities Commission (CPUC), the California Air Resources Board (CARB), the California Energy Commission (CEC), and the state's investor-owned utilities — PG&E, Southern California Edison (SCE), and San Diego Gas & Electric (SDG&E).
The transition to NEM 3.0 in April 2023 dramatically changed solar project economics. Solar-only systems now face significantly lower export compensation, while battery storage systems have become essential for maximizing the value of new solar installations. Storage keeps a longer federal credit phase-down than wind and solar under the One Big Beautiful Bill Act.
SGIP — Self-Generation Incentive Program
SGIP is California's primary battery storage rebate program, providing per-kWh incentives for behind-the-meter storage systems. The program offers multiple equity tiers that significantly increase rebate values for low-income and disadvantaged community projects. Rebate levels and remaining budget change as funding steps are used, so confirm current figures with the SGIP program administrator.
CPUC IOU Utility Programs
Pacific Gas & Electric (PG&E)
Northern & Central CaliforniaCommercial building efficiency rebates, EV fleet charging programs, demand response, and solar + storage incentives through the CPUC-mandated portfolio.
Southern California Edison (SCE)
Southern California (excl. San Diego)Residential and commercial efficiency rebates, solar incentives, demand flexibility programs, and the Business Energy Management program for large commercial accounts.
San Diego Gas & Electric (SDG&E)
San Diego + Orange CountyEV charging infrastructure incentives, commercial efficiency programs, and battery storage rebates layered with SGIP in the SDG&E service territory.
NEM 3.0 — Net Billing Tariff
California's Net Energy Metering 3.0 (officially the Net Billing Tariff) took effect for new applicants in April 2023. Under NEM 3.0, export compensation reflects time-of-use grid values rather than retail rates, which substantially reduced it compared to NEM 2.0.
Impact on solar-only systems: Under NEM 3.0, solar-only systems have significantly longer payback periods. Battery storage is now essential for maximizing self-consumption and achieving acceptable project economics.
Disadvantaged Community Programs
California's CPUC designates Disadvantaged Communities (DACs) using the CalEnviroScreen tool. Projects serving DAC residents receive significantly enhanced incentives across multiple programs, and may also qualify for a separate federal low-income bonus.
SGIP Equity Budget
Storage rebates for DAC and low-income customers, set above the standard tier.
Federal Low-Income Bonus
Federal bonus for qualifying low-income community solar and wind projects, subject to the deadlines the One Big Beautiful Bill Act set for wind and solar.
CPUC DAC Green Tariff
Discounted green electricity rates for low-income customers in DAC areas.
CA Property Tax Exclusion for Solar & Storage
California excludes qualified solar energy systems and battery storage equipment from assessed property value under the Active Solar Energy System exclusion (Revenue and Taxation Code § 73). This means installing solar or storage does not increase property taxes, effectively providing ongoing tax savings over the life of the system.
The exclusion applies to residential, commercial, and industrial properties statewide, but it has a statutory sunset date. Confirm with your county assessor that your system qualifies before counting on it.
California Offshore Wind (Emerging)
California is developing the first US commercial-scale floating offshore wind industry off the central and northern coasts. BOEM awarded floating wind leases in 2023 for the Morro Bay and Humboldt Wind Energy Areas, representing approximately 4.6 GW of potential capacity.
Morro Bay Wind Energy Area
Central CA coast, San Luis Obispo County offshore
Humboldt Wind Energy Area
Northern CA coast, first floating wind in US federal waters
Frequently Asked Questions
What is SGIP and how much is the rebate?
The Self-Generation Incentive Program (SGIP) provides rebates for behind-the-meter battery storage systems in California. Rebates are paid per kWh of installed capacity, and equity tier projects (low-income, disadvantaged communities) receive higher rebates. Rebate levels change as budget steps are used, so confirm current figures with the program administrator. The program is overseen by the California Public Utilities Commission.
How does NEM 3.0 affect solar economics in California?
NEM 3.0, effective April 2023 for new applicants, substantially reduced solar export compensation compared to NEM 2.0. This significantly changes the economics of solar-only systems. Battery storage paired with solar now provides much greater value by shifting self-consumption and avoiding time-of-use export penalties. Projects should model battery + solar together under NEM 3.0 rules.
Can California solar projects stack state and federal incentives?
Often, yes. A California project may be able to combine the federal investment tax credit, an SGIP battery storage rebate, the CA property tax exclusion, and CPUC IOU efficiency programs, but each program sets its own rules on combining incentives. For solar and wind, the federal credit now carries the construction-start and placed-in-service deadlines set by the One Big Beautiful Bill Act.
Is solar and storage equipment exempt from California property taxes?
California excludes solar energy systems and qualifying battery storage systems from assessed property value under the Active Solar Energy System property tax exclusion, which applies to residential, commercial, and industrial installations. The exclusion has a statutory sunset date, so confirm with your county assessor that your system qualifies.
What are California Disadvantaged Community incentive adders?
Projects located in CPUC-designated Disadvantaged Communities (DACs) or serving low-income households can be eligible for higher rebate tiers under SGIP and other CPUC programs. A separate federal bonus for qualifying low-income community solar and wind projects may also apply, subject to the wind and solar deadlines set by the One Big Beautiful Bill Act.
Check the Federal Credits for Your California Project
IncentEdge's verified catalog covers New York programs and federal credits. For a California project it can check the federal credits; the California programs on this page are background to confirm with each administrator.
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