Residential Incentives

Residential Incentives

There are many incentives for homeowners and businesses that brings the cost to get into solar very affordable. In addition, the incentives reduce the payback time to sometimes as little as 5 years depending on the size of the system. For an overview of what is currently available please see below. Additional information on incentives is available at www.gosolarcalifornia.ca.gov

Our Solar Calculator can give you a good estimation of your costs and even lists incentives for your specific area. Please check out the Getting Started tab to find our calculator.

Federal Incentives


Residential Renewable Energy Tax Credit

Tax Credit:                         Credit Details: 30% of the cost, up to $500 per .5kW of power capacity

Expires:                               December 31, 2016

Requirements:                  Photovoltaic systems must provide electricity for the residence, and must meet applicable fire and electrical code requirement. Need to file an IRS form for the year your system is placed into service.

 

A taxpayer may claim a credit of 30% of qualified expenditures for a system that serves a dwelling unit located in the United States and used as a residence by the taxpayer. Expenditures with respect to the equipment are treated as made when the installation is completed. If the installation is on a new home, the "placed in service" date is the date of occupancy by the homeowner. Expenditures include labor costs for onsite preparation, assembly or original system installation, and for piping or wiring to interconnect a system to the home. If the federal tax credit exceeds tax liability, the excess amount may be carried forward to the succeeding taxable year. The excess credit can be carried forward until 2016, but it is unclear whether the unused tax credit can be carried forward after then. The maximum allowable credit, equipment requirements and other details vary by technology, as outlined below.

Solar-electric property

·         There is no maximum credit for systems placed in service after 2008. The maximum credit is $2,000 for systems placed in service before January 1, 2009.  

·         Systems must be placed in service on or after January 1, 2006, and on or before December 31, 2016.  

·         The home served by the system does not have to be the taxpayer’s principal residence.  

·         Note that the Solar Energy Industries Association (SEIA) has published a three-page document that provides answers to frequently asked questions regarding the federal tax credits for solar energy.

 

California Solar Initiative Rebates

 

California Solar Initiative rebates vary according to utility territory, system size, customer class, and performance and installation factors. The rebates automatically decline in "steps" based on the volume of solar megawatts (MWs) with confirmed project reservations within each utility service territory. The figure below shows the expected schedule for rebate decline over time. To find the currently applicable rebate level in your area, check the CSI Statewide Trigger Tracker, which tracks the currently available MWs at each step level per utility and per customer class. There are two incentive paths available to consumers: Expected Performance Based Buydown (EPBB) and Performance Based Incentive (PBI).

The CSI Program pays solar consumers an incentive based on system performance. The incentives are either an upfront lump-sum payment based on expected performance, or a monthly payment based on actual performance over five years. The Expected Performance-Based Buydown (EPBB) is the upfront incentive available only for smaller systems. The EPBB incentive is a capacity-based incentive that is adjusted based on expected system performance calculated using an EPBB calculator that considers major design characteristics of the system, such as panel type, installation tilt, shading, orientation, and solar insolation available by location. The EPBB calculator estimates the expected performance of a solar system based various factors including the tilt, azimuth, location, PV module type and mounting type of a specific system.

The Performance Based Incentive (PBI) is paid based on actual performance over the course of five years. The PBI is paid on a fixed dollar per kilowatt-hour ($/kWh) of generation basis and is the required incentive type for systems greater than 30 kW in size, although smaller systems may opt to be paid based on PBI. In the beginning of the CSI Program, all systems 100kW and greater were required to take the PBI incentive. In January 2008, all systems 50kW and greater were required to take the PBI incentive. As of January 2010, all systems 30kW and greater are required to take the PBI incentive.

These two incentive types are explained in more detail in the table below.

CSI Incentive Types

Expected Performance-Based Buydown (EPBB)
(Paid in dollars/Watt)

Performance-Based Incentive (PBI)
(Paid in cents/kWh)

Ideal for residential and small business projects

Ideal for larger commercial, government & non-profit projects

Systems less than 30 kW

Mandatory for all systems 30 kW and greater Systems less than 30kW can opt-in to PBI

Incentive paid per Watt based on your system's expected performance (factors include CEC-AC rating, location, orientation and shading)

Incentive paid based on the actual energy produced by the solar system, measured in kilowatt-hours

One-time, lump-sum upfront payment

60 monthly payments over five years

 

CSI Incentive Levels as adopted in D.06-12-033

The California Public Utilities Commission (CPUC) issued a ruling on July 9, 2010, announcing a temporary suspension of incentives for government and non-profits, and all performance-based incentives for systems over 30 kilowatts (kW). A second ruling was issued on July 29, lifting the suspension. Effective July 29, program administrators will again process applications from government, non-profits, and systems over 30 kW. The Commission will continue to examine the sustainability of current funding levels for the program, and may make changes in the future. Any future changes would not be applied retroactively; they would only apply to applications received after the changes are implemented.  

In January 2006, the California Public Utilities Commission (CPUC) adopted a program -- the California Solar Initiative (CSI) -- to provide more than $3 billion in incentives for solar-energy projects with the objective of providing 3,000 megawatts (MW) of solar capacity by 2016. The CPUC manages the solar program for non-residential projects and projects on existing homes ($2+ billion), while the CEC oversees the
New Solar Homes Partnership, targeting the residential new construction market (~$400 million). Together, these two programs comprise the effort to expand the presence of photovoltaics (PV) throughout the state,
Go Solar California.  

Originally limited to customers of the state’s investor-owned utilities, the CSI was expanded in August 2006, as a result of Senate Bill 1, to encompass municipal utility territories as well. Municipal utilities are required to offer incentives beginning in 2008 (nearly $800 million); many already offer PV rebates.  

 

What Do I Do Next?

Earning incentives for solar energy is simple. Your SunWave Solar professional will take care of these steps for you:

Step 1: Energy Efficiency Audit
Complete an energy efficiency audit and make sure to take advantage of all the cost-effective ways to save energy and money in your home or business.

Step 2: Find a Solar Installer
Qualified contractors are your key to getting the most productive solar energy system for your home or business.

Step 3: Apply for Rebates
Qualified contractors will handle the CSI application process for your rebates in two or three steps.

Step 4: Install Your System
If you have received your reservation confirmation letter, you're ready to install your system and interconnect to the utility's power grid.

Step 5: Claim Your Incentive
When your project is installed and operational you may submit the Incentive Claim Form.

 

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