A breakdown of California’s SGIP battery rebate
The Self-Generation Incentive Program (SGIP) in California is one of the best incentives for homeowners who want to pair a solar battery with their solar panel system. The state of California is already a leader in the solar industry, and SGIP is slated to make it one of the top states for battery storage, too.
By cutting the costs of a solar battery by one-third, the SGIP battery rebate allows California homeowners to have access to reliable, clean energy - which is more important than ever with the coronavirus pandemic and increasingly intense wildfire seasons in the Golden State.
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Tesla’s commercial battery storage system, Powerpack. Image source: Engadget.com
What is SGIP?
SGIP is an incentive program run by the California Public Utilities Commission (CPUC).
The main SGIP incentive offered is for energy storage systems, thanks to the passing of Senate Bill 700 in 2018. In fact, 80% of the program’s budget is now allocated for battery storage.
The remaining 20% of the SGIP budget is reserved for rebates for other “behind-the-meter” distributed generation technologies, such as wind turbines, waste-to-heat power, and pressure-reduction turbines.
How much can you save on a battery storage system with SGIP?
Making the decision to install a battery storage system at your home can be an expensive investment. SGIP can soften the blow of the upfront installation costs and make installing battery storage a more affordable option.
Right now, residential customers will receive $0.25 per watt-hour of energy storage they install. That adds up to thousands of dollars!
In order to apply for the SGIP rebate program, you must submit your application to an SGIP Program Administrator.
Customers of PG&E, SCE, and SoCalGas can apply for the SGIP rebate directly through their utility. Other California residents can apply through the Center for Sustainable Energy (CSE), a non-profit organization dedicated to advancing clean energy.
PG&E, SCE, SoCalGas, and SCE are all SGIP Program Administrators.
Is the Tesla Powerwall eligible for SGIP?
Yes, homeowners who install Powerwall can apply to receive a rebate from SGIP.
One Tesla Powerwall has a capacity of 13.5 kilowatt-hours, and costs $11,000 to be installed.
At the current residential SGIP incentive rate of $0.25 per watt-hour, a Tesla Powerwall system would be eligible for a rebate of $3,375. That means the total installed cost of a Tesla Powerwall including the SGIP incentive would be $7,625.
The cost of installing a Powerwall would drop even lower thanks to the federal tax credit. When the 26% solar tax credit is applied on top of the SGIP incentive, the cost to install a Tesla Powerwall would be $5,642.50. That’s about half of the initial price!
Who can take advantage of the SGIP rebate?
In order to qualify for SGIP, applicants must either be a commercial, industrial, agricultural or residential customer of PG&E, SCE, SoCalGas, or San Diego Gas and Electric (SDG&E).
The SGIP rebate for battery storage is separated into 5 categories:
- Large-scale storage systems
- Residential storage systems
- Residential equity systems
- Residential equity resiliency systems
- Non-residential equity systems
Each category’s budget is divided into five steps. There is a limit of how many projects can qualify for each step. When the limit for a step is met, the next step opens with a different incentive rate. The incentive rate is lower as each step opens.
|System type||Step 1||Step 2||Step 3||Step 4||Step 5|
|Large-scale storage (>10 kW)||$0.50 / Wh||$0.40 / Wh||$0.35 / Wh||$0.30 / Wh||$0.25 / Wh|
|Large-scale storage (>10 kW) with ITC||$0.36 / Wh||$0.29 / Wh||$0.25 / Wh||$0.22 / Wh||$0.18 / Wh|
|Residential storage (≤10 kW)||$0.50 / Wh||$0.40 / Wh||$0.35 / Wh||$0.30 / Wh||$0.25 / Wh|
|Residential equity storage (≤10 kW)||N/A||N/A||$0.85 / Wh||$0.85 / Wh||$0.85 / Wh|
|Residential equity resiliency storage (≤10 kW)||N/A||N/A||$1.00 / Wh||$1.00 / Wh||$1.00 / Wh|
Large-scale storage systems
Large-scale storage systems are bigger than 10 kilowatts (kW) in size.
It is important to note that if you are installing a large-scale battery system and taking advantage of the federal investment tax credit, you will receive a lower incentive rate.
All of the large-scale storage system programs are currently in Step 3. Large-scale battery systems installed without the federal tax credit will receive $0.35 per Wh. Those that do utilize the tax credit will receive $0.25 per Wh.
Residential storage systems
If you are a homeowner considering installing a battery storage system, you can apply for the residential SGIP incentive.
The system installed must be on a residential property and must be 10 kW or less in size. Using the federal tax credit does not impact the residential incentive rate.
All residential storage programs are currently in Step 5 and will receive a rebate of $0.25 per Wh of battery storage installed.
Residential equity systems
If you are a low-income customer in a multi-family or single-family home, you may qualify for the residential equity incentive. The incentive rate for the equity budget remains the same, regardless of what step the program is in.
Also, the SGIP developer cap does not apply for equity systems. You can check the SGIP handbook to see if you qualify as a low-income home or are determined to live in a disadvantaged area.
All residential equity programs are currently in Step 5 and will receive a rebate of $0.85 per Wh of battery storage installed.
Residential equity resiliency systems
A recent ruling opened up a new SGIP category - the equity resiliency budget. The goal of the equity resilience program is to help provide energy security to low-income homes that are located in high-risk wildfire zones.
- Be eligible for the residential equity budget
- Be located in a Tier 3 or Tier 4 fire threat district and/or
- Have experienced two or more Public Safety Power Shutoffs (PSPS) at the time of application
The incentive amounts for residential equity resiliency systems are designed to cover close to 100% of energy storage installation costs. The incentive rate for the equity resiliency budget remains the same, regardless of what step the program is in.
All residential equity resiliency projects will receive $1.00 per Wh of energy storage installed.
Non-residential equity systems
Non-residential equity projects must be installed at local or state government agencies, educational institutions, non-profits, or small businesses. Additionally, the site must be in a disadvantaged or low income community.
All non-residential equity resiliency projects receive $1.00 per Wh of energy storage installed.
How to apply for the SGIP rebate
Applying for the SGIP rebate is easy! Usually, the installer of your energy storage system will do all the work for you, so you don’t have to worry about the application process.
The CPUC has released a guide with four steps for home and business owners to get started with the SGIP rebate:
- Research battery storage installers in your area to find which one is the best for your battery installation.
- Contact installers to get quotes on battery installation prices, what battery is right for you, as well as what SGIP program category you qualify for.
- Pick your installer and work with them to complete your installation project.
- Contact your Program Administrator with any further questions.
What is the future of SGIP?
Thanks to SGIP, California has gained an additional 85 megawatts of energy storage projects. The large-scale programs and each of the equity programs still have plenty of funds remaining.
As programs begin to reach the end of Step 5, a waitlist will be established. If funds become available, the waitlisted projects will be reviewed by program administrators.
The popularity of the residential storage program has brought all of the programs into their final step with two of the program administrators, PG&E and CSE, starting waitlists.
Program administrators will accept applications until all incentive funds have been paid or until December 31, 2020 - whichever comes first.
Author: Catherine Lane | SolarReviews Blog Author
Catherine is a researcher and content specialist at SolarReviews. She has strong interests in issues related to climate and sustainability which led her to pursue a degree in environmental science at Ramapo College of New Jersey.