California solar rebates and tax credits calculator

Solar incentive

Federal ITC 30% (tax credit)

State tax credit: No

Net metering (by utility)

Calculate for your home's location

There can be solar tax credits and incentives available at the federal, state and local levels. The calculator above will show you the value of all incentives your home is eligible for.

Summary of California solar incentives 2022

2021 is shaping up to be a year of huge changes for residential solar energy programs in California. The state Public Utilities Commission is in the middle of making changes to net metering, the energy billing arrangement under which solar panel owners earn credit for their excess energy that they can later use to offset energy the draw from the grid at night. Those changes may result in much worse financial returns from solar for people who get panels installed after the new rules take effect.

On this page, we cover all of the solar and battery incentives, rebates and tax credits available for your California home solar installation. We also provide guidance on how low income solar power programs work.

We also encourage you to use the California solar incentives calculator above. It allows you to drill down and show only the solar incentives that are applicable where you live.

On this page, you can:

  1. Learn what solar incentives are available to California homeowners

  2. See what California solar incentives you qualify for based on your utility company and city

  3. Find out how much these incentives and/or California solar tax credits will reduce your cost to go solar and add batteries

Federal solar investment tax credit

The federal solar investment tax credit will have the biggest impact on the cost you will face to go solar in California

If you install your photovoltaic system before the end of 2032, the federal tax credit is 30% of the cost of your solar panel system. This is 30% off the entire cost of the system including equipment, labor, and permitting.

Example: If your solar energy system costs $20,000, your federal solar tax credit would be $20,000 x 30% = $6,000.

The federal tax credit falls to 26% starting in 2033.

Net energy metering in California

With net metering in some states, you get full retail rate credit for the amount of electricity you send back into the grid with your solar panels.

With net metering, or “net energy metering” (NEM), you get near-full retail rate credit for the amount of electricity you send back into the grid with your solar panels. The reason why it’s near full retail rate credit instead of full retail rate credit for the electricity you send back to the grid is because California recently amended their NEM to NEM 2.0.

As part of that change, the energy you buy from your utility company comes with a small “non-bypassable charge” of 3 cents per kilowatt hour (kWh). Under NEM 2.0, you don’t get this same amount as credit when you send electricity back to the utility grid (Note, if you’re an LADWP customer, you still will get full retail NEM without this non-bypassable charge).

You’ll also need to sign up for a time-of-use billing plan (TOU), which has variable energy costs based on what time of day it is. Evening has the most demand, so your energy prices will be higher at this time.

While that may sound bad, you can do very well to offset TOU billing changes by installing a solar energy storage system. You can charge the battery during the middle of the day with your free solar electricity, and discharge in the evening, when purchasing from the grid would be more expensive.

With NEM, The amount of kilowatt hours (kWh) you send to your local utility and pull from it are “netted” monthly. If you use more than you send to the grid at the end of the year, you pay for the balance.

Net metering in California can be extremely valuable over the life of your solar system. When paired with TOU billing and the ability to send power to the grid during off-peak hours, your savings are enhanced even further.

Luckily, your solar installer is a net metering expert. They will help you design a solar system to maximize your savings.

Learn more:

California solar rebates

California used to have a robust solar rebate program called the California Solar Initiative (CSI). The rebates available were fully used up by 2014, but the program succeeded in driving 3 terawatts of solar energy capacity to the grid.

Rebates live on for Californians with low income however. Check out the SASH and MASH programs outlined in the California solar incentives for low income households section below.

California solar tax credit

While some states still offer their own state tax credits for solar energy, California doesn’t anymore.

However, Golden State policymakers have enacted a property tax exemption for solar PV which is still going strong. This is a great perk, since solar panels will increase the value of your home by roughly 70% of system costs. So while the value of your home will go up, your property taxes won’t.

Example: If your solar system costs $20,000, your estimated property value increase of $14,000 will be tax exempt.

SGIP - California’s solar battery storage program

California is not only a national leader in solar, it is also a leader in solar battery storage, thanks in part to the Self Generation Incentive Program (SGIP).

If you install a battery storage system on your property that is serviced by PG&E, SCE, Southern California Gas, or SDG&E, you can take advantage of the SGIP incentive.

Battery storage systems that are smaller than 10 kW and are installed on a residential property are eligible for an incentive of $0.25 per watt hour of storage installed.

We outline how much you can save on battery storage when you use the SGIP incentive program in our breakdown of the SGIP rebate.

The SGIP equity budget for home battery storage

SGIP also has what is known as the “equity budget”. This budget has money set aside for solar batteries that are installed in low-income and disadvantaged areas.

The goal of the residential equity incentive is to catalyze more battery storage deployment in low-income areas.

Residential equity systems will receive a rebate of $0.85 per watt hour installed.

Low income homes that are located in either a Tier 3 or Tier 4 fire district, or that are in areas that have experienced two or more planned safety power shutoff (PSPS) events can qualify for an even higher incentive when they install battery storage on their home - this is known as the equity resilience incentive.

Projects that qualify for the equity resiliency incentive program will receive a rebate of $1.00 per watt hour of storage installed.

This covers almost the entire cost of a solar battery system. Check our blog on SGIP's equity resiliency program for more information.

California solar incentives for low-income households

Throughout the US, solar is adopted more in areas that have higher incomes even though low-income communities have the most to gain from the benefits of solar power.

Low income solar incentives have the ability to spur solar development in disadvantaged communities.

California has two types of low-income solar programs which are aimed for single-family homeowners and owners of multi-family properties:

The single-family affordable solar homes (SASH) program

The California SASH solar program provides huge solar money to single family homeowners. The program is administered by the non profit organization Grid Alternatives. They help provide green job training in low income areas to help people secure good-paying green energy jobs.

SASH program requirements

If you can qualify for the SASH program, you’ll get an upfront incentive of $3 per watt of solar installed.

So, if you want to install a 6 kilowatt system on your home, you’ll get an incentive of $18,000! That’s basically enough to pay for the entire cost of your solar system.

If you meet the following criteria, you could get this solar money:

  1. You’re a Pacific Gas & Electric, Southern California Edison, or San Diego Gas & Electric customer
  2. You own and live in your home
  3. Have a household income that is 80% of or below the the area median income
  4. Live in a home that is considered to be “affordable housing” by the California Public Utility code.

To check if you live in one of the approved areas, explore this map.

The multi-family affordable solar homes (MASH) program

The MASH program is designed for those fortunate enough to own a multi-family housing complex.

Those people can qualify for a large grant program to retrofit low-income multi-family housing developments with solar power.

Grants range from $1.10 to $1.80 per watt of solar installed. Exact amounts for different project types are listed on the California Public Utilities Commission website.

To qualify for MASH:

  1. The multi-family residential building must be financed by one of the following:
    1. Low-income housing tax credits
    2. Tax-exempt mortgage revenue bonds
    3. General obligation bonds
    4. Some kind of local, state, or federal grants and loans
  2. If at least 20% of the total units are sold or rented to lower-income residents.

There are some additional qualifications listed in the MASH program handbook. The MASH program is currently fully subscribed. New applications will be placed on a waitlist.

Cost of solar panels in your part of California after all applicable solar incentives

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Best 10 solar companies in California

519 solar companies in California provide pricing on SolarReviews. Here are the best rated companies near you.

Solar guides for your California city

For more information about going solar near where you live, check out the following resources:

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