Thursday, May 16, 2024

What Is The California Solar Initiative

The Sgip Equity Budget For Home Battery Storage

California Solar Water Heating Initiative

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 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 Tax Credits And Solar Rebates

Solar panels have long proved a reliable and savvy financial investment for Californians, and many buyers are able to secure a speedy return on investment . However, there is currently no statewide California solar tax credit to help residents with the upfront cost of solar panels.

That said, all Californians are eligible for the federal solar tax credit, and the state offers several incentive programs and solar rebates aimed at further increasing access to reliable, affordable solar panels.

California Solar Incentive
The SGIP offers rebates for installing energy storage systems at both residential and non-residential facilities.
Active Solar Energy System Property Tax Exclusion This incentive ensures the addition of a solar panel installation doesn’t raise homeowners’ property taxes.
Single-Family Affordable Solar Homes Program The California Solar Initiative launched SASH to provide fixed, up-front incentives on qualifying affordable single-family housing.

What Happens When The California Solar Initiative Runs Out

In 2006, the Californian legislature passed the sweeping California Solar Initiative, allocating over $2 billion for rebates targeting residential and commercial solar systems. The initiatives original goal was to expand Californias solar infrastructure by 1,940 megawatts of electrical generating capacity.

Last May, all but 477 megawatts of solar capacity had been claimed. At that rate, any remaining rebates will likely run out by the end of this year or early next year, four years ahead of schedule.

Because the rebates are on the verge of running out, two of the three utility companies involved in the program started putting customers on a waiting list for California solar rebates last year. For any customers still interested in taking advantage of these California solar rebates, time is running out fast.

Where Did the Money Go?

For a program designed to provide rebates for 10 years, the CSI has managed to burn through nearly all of its funding in just half that time, which has raised reasonable questions about how $2 billion has been spent.

The answer lies with how the CSI provides rebates for California solar energy systems. The first rebate, the Expected Performance Based Buydown, provides a lump sum payment following system installation based on expected performance. However, the second type of rebate, the Performance Based Incentive, pays solar panel owners each month based on actual performance over a period of five years.

Other Consequences

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Ca Solar Initiative: Overhyped And Underperforming

Now that the $2.167 billion California Solar Initiative is winding down, electricity ratepayers might ask: What was it and what did it accomplish? Was it:

1) A cutting edge solar energy project to bring about a self-sustaining solar power industry, as touted by the California Public Utilities Commission and state legislators?

The answer is mostly no based on post-project evaluations done by academic experts.

2) A program to replace very expensive conventional peak time power plants with equally expensive but clean rooftop solar electricity that is generated at the time of day when it is hottest?

The answer is no. Contending that rooftop solar power replaces conventional peak time power is bogus. This is because electricity rates are tiered depending on usage and climate zone and the fact that ultra peak power rates during heat waves and cold snaps only last maybe as much as four weeks out of 52 weeks in a year.

3) An expensive, artificial green energy and jobs program that is now being wound down, as there is a recovery in the jobs market?

The answer is yes. Since Californias Solar Initiative did not produce a self-sustaining rooftop solar power market and cannot be justified as a replacement for expensive peak time electricity, this leaves us with one conclusion: It was mainly a jobs stimulus program that ended up adding about a $200 tax to 10.8 million utility customers electric bills.

How Much Is The California Solar Tax Credit In 2021

Follow the Guvernator: Why Californias Solar Initiative ...

Homeowners installing solar panels in California will receive a 26% tax credit on their purchase.

Its important to make a clarification here: there is no California-specific solar tax credit. When people refer to the California solar tax credit, they are actually referring to the federal solar tax credit, which applies to all American homes, including those in California.

The federal solar tax credit is 26% of the cost of a system until the end of 2022, and falls to 22% in 2023. Unless new federal legislation is introduced, the federal solar investment tax credit will be gone in 2024.

Learn more: The federal solar tax credit: all your questions answered

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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 inCalifornia

This perk is commonly known as the ITC, short for Investment Tax Credit. If you install your photovoltaic system in 2020, the federal tax credit is 26% of the cost of your solar panel system. This is 26% 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 26% = $5,200.

The federal tax credit falls to 22% at the end of 2022.

Millions Of Utility Customers Subsidize Solar Installations

Of course, the CPUC omitted disclosing that the $6.16 per kilowatt cost of installing rooftop solar power came by adding $2.167 billion to the electricity bills of other California electricity ratepayers. To provide subsidies to the 118,303 recipients of residential, commercial and governmental rooftop solar power installations the electricity bills had to be raised for 10.8 million customers of Southern California Edison, Pacific Gas and Electric and San Diego Gas and Electric through its subsidiary the California Center for Sustainable Energy .

In other words, the Solar Initiative mandated on average about 91 other electricity customers to subsidize the rooftop solar installations of each rooftop solar power installation. Spread over 10.8 million customers, that equates to about a $200 tax per California electricity customer. The California Solar Initiative is another socialized system like Social Security that is based on a larger base of utility ratepayers paying for a smaller number of recipients. It is a program based on privatizing profits and socializing losses.

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Solar Advocates Have New Scheme For Post

Now that subsidies for rooftop solar power are being phased out, the solar energy industry is trying to push subprime energy home loans on unsuspecting homeowners. Has California learned nothing from its catastrophe with subprime residential housing loans?

The solar industry asserts that the bulk of California rooftop solar panels were installed in middle-class ZIP codes and were not just for wealthy homeowners. But the top 20 ZIP codes for residential rooftop solar installations subsidized by the Solar Initiative all were in wealthy ZIP codes and represented 10.3 percent of all the 118,303 installations under the program . Of a total of 2,591 ZIP codes in California, 20 wealthy ZIP codes ended up with a disproportionately high proportion of rooftop solar installations . This phenomenon of green-energy subsidies helping the wealthy should be familiar to CalWatchdog readers.

This is why the Little Hoover Commission is calling for a time out for all green power in California. The California Solar Initiative was an expensive, artificial jobs and clean-energy program that needs to be seen for what it really was. The California Solar Initiative should be left in the shade where it belongs.


Zip Code

Find Out If You Qualify For California Solar Incentives

California solar panel mandate costly, but necessary, change?

Federal Solar Investment Tax Credit

Buy and install a new home solar system in California in 2021, with or without a home battery, and you could qualify for the 26% federal tax credit. The residential ITC drops to 22% in 2023 and ends in 2024.5

Average-sized 5-kilowatt system cost in California: $18,925 Approximate system cost in California after the 26% ITC in 2021: $14,00511

Self-Generation Incentive Program

Buy a battery system along with your rooftop panels in California and get a rebate for your home solar battery installation.

PG& E, SCE, SoCalGas, and SDG& E customers may be eligible for this rebate, which can be as high as $200 per kilowatt-hour .6

Solar Energy System Property Tax Exclusion

Add a new home solar installation in California or build a house with a solar panel system, and your property taxes wont increase until the end of 2024.7

Installing a system also helps you build home value. Approximate solar home value increase in California: 3%12

Single-Family Affordable Solar Housing

Eligible low-income households can receive a one-time up-front, capacity-based incentive of $3,000 for every kW of home solar installed.8

To qualify for SASH, the home must be occupied by the homeowner/applicant and receive electrical service from PG& E, SCE, or SDG& E.8

The household’s total income must be 80% of the Area Median Income or less based on the most recent available income tax return.8

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Two Visions Of Environmentalism

Beneath the political and technical disputes is a stark philosophical divide.

At one end are environmentalists who deeply mistrust big utilities and think regular people have a right to generate their own power. Some are conservationists who dont want to see massive solar farms disrupt sensitive ecosystems and scenic landscapes.

Distributed solar is such a no-brainer to put your solar right there and share it with your neighbors, said Sara Lee, a teacher and activist who helped organize a protest of Assembly Bill 1139 outside Carrillos Echo Park office.

At the other end of the divide are environmentalists who see existing institutions including big corporations and the utility grid as the fastest, easiest way to tackle global warming. They agree that rooftop solar is important for reducing emissions but also cite research showing its more expensive than large solar farms, which benefit from economies of scale.

To Borenstein, the reality is that solar homes still depend on utility poles and wires, since they export power to the grid at certain times of the day and draw power from the grid at others. With net metering, he said, theyre free riding on the system.

Our business strategy is tied to the goals of the state, Edisons Choi said.

Curtis Stone has been using induction cooktops for years.

The solar industry has also hired PR firms, just like ours, she said.

Recent Updates To Sash

In June of 2018, the CPUC announced that it would continue to incentivize solar installations in low-income housing through the Disadvantaged Communities-Single-family Solar Homes program. This program will be modeled after the existing SASH program and continue to provide the same upfront rebates of $3 per watt up for eligible homeowners while also providing additional assistance in regards to raising capital for the installation or accessing financing. In addition, the eligibility for the DAC-SASH is broader than compared to the traditional SASH program. You no longer have to live in a household designated as affordable housing, which will allow this new program to help even more people go solar. This revitalized program will have $10 million in funds available annually until 2030.

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But Doesnt Rooftop Solar Replace Pricey Peak Power

But does rooftop solar power replace expensive and polluting conventional peak power plants ? Does it replace expensive but non-polluting industrial solar farms that blight Californias natural deserts?

Peak power is high-priced power resulting from spikes in demand for electricity due to a heat wave, cold snap, power outage from a blackout due to system failure, or from regulations that create a pricing fever such as occurred during the California energy crisis of 2001.

Peak power can be contrasted with base load power, which is the power needed to meet the energy demands on typical days.

The average price of peak power in California on July 4, 2013 according to Energy News Data website ranged from about $7.10 to $49.70 per megawatt hour . The average retail price for non-peak electricity in California is $0.15 per kilowatt-hour as of April 2013. Some of Californias peak power is imported from the Columbia River, the Klamath River, and coal power plants in Arizona, Nevada and Utah.

Peak prices can spike to $250 per megawatt hour during the hot July and August months in California. So heavily subsidized rooftop solar power may look like a real deal. But such peak prices typically only last for one to two weeks or so during the year.

Start Saving With Solar Today

California Solar Initiative: What You Need to Know

Solar is a great investment for homeowners in California, whether youre eligible for the SASH program or not. The average homeowner in California sees a payback period of roughly six years when purchasing a solar panel system. If you can take advantage of the SASH rebate, the payback period will be even shorter.

If youre interested in seeing what you can save in electricity bills by going solar, sign up on the EnergySage Marketplace. You can get multiple quotes from reputable, local solar installers for free. If youre interested in the SASH program specifically, simply note it in your account so installers can include information about it in their proposal. If youd prefer to start investigating your solar options with quick numbers on cost and savings, try our Solar Calculator.

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Faqs: California Solar Incentives

Is there a California state tax credit for solar?

Though California does not offer a statewide solar tax credit, all residents are eligible for the current federal solar tax credit. The solar tax credit is worth 26% of the value of the system installed and can be claimed on federal tax returns.

What is the California solar tax credit for 2021?

All American households are eligible for the federal solar tax credit, which is valued at 26% of your solar system cost. California does not have any other state-specific solar tax credit, but it does offer property tax exemptions for new solar installations.

Does California have a free solar program?

The reality is, no state has a free solar program. Fortunately, California does offer several incentives and rebates for installing solar panels, making it a very cost-effective place to do so.

How much is the solar tax credit for 2021?

All U.S. households are eligible for the federal solar tax credit. In 2021, this tax credit is valued at 26% of the purchase of solar panels and qualifying energy storage devices.

California Solar Initiative: The Sash Program

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The Golden State has always been a front-runner when it comes to solar energy. California is consistently ranked as the top state for solar when it comes to both jobs and installed capacity. Much of their original growth in solar has been due to the California Solar Initiative . Enacted in 2006, CSI was designed to provide upfront rebates for residential and commercial property owners purchasing solar panel systems. The rebates were available for customers of three utility companies: Pacific Gas and Electric , Southern California Edison , and San Diego Gas and Electric .

This initiative is a part of Californias larger Go Solar California campaign, and had an initial goal to reach approximately 1,940 megawatts of new solar generation capacity from 2007 until 2016. Because of its success, the majority of the money available for the rebates was quickly used up and hasnt been available to many utility customers for years. But, that doesnt mean CSI is dead. In an effort further stimulate the growth of solar in within the state, the California Public Utilities Commission decided to allocate no less than 10% of CSIs funds to programs committed to providing solar electric systems to low-income households. Thus came about the Single-family Affordable Solar Homes Program : a favorable rebate that continues to make an impact today.

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Cost Of Solar Panels In California

Living in California comes with many benefits, including plenty of sunshine. Residents have long taken advantage of this by harnessing clean energy from the sun. Installers, along with local and federal bodies, offer plenty of incentives to help ease the switch for electric consumer residents. As equipment has become more advanced and efficient, solar panel costs have dropped.

The exact cost of a solar panel system for your California property depends on several factors, such as your county of residence, the size of your system, the installation company you have chosen, and the equipment used. According to recent data, an average-sized 5 kilowatt solar installation costs between $13,175 and $17,825.

This might sound like too big of an investment at first, but the good news is that your state is a leader in solar capacity and incentives, so there are plenty of opportunities to save in 2020. Read on to find out more!

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