Solar Incentives in California (2026)
California homeowners pay an average of $0.28/kWh for electricity. With the right incentives, solar can offset a significant portion of that cost. Below are the 4 active programs available in Californiaas of February 2026.
Federal ITC Update: The federal residential solar tax credit (Section 25D) expired December 31, 2025 per the One Big Beautiful Bill Act (Public Law 119-21). The commercial ITC (Section 48E) remains active at 30% for systems under 1 MW through 2032. State and utility programs listed below remain in effect.
Active Incentive Programs
| Program | Type | Authority | Amount | Description |
|---|---|---|---|---|
| Rebate | California Public Utilities Commission (CPUC) State | $200 per kWh of battery capacity | Rebate for battery storage systems paired with solar. Higher rebates available for equity and equity-resilience categories. Customers of PG&E, SCE, SDG&E, or SoCalGas. Must install qualifying energy storage system. | |
| Net Metering | California Public Utilities Commission (CPUC) State | Export credits based on time-of-use avoided cost rates. Credits vary by hour and season; typically $0.05-0.08/kWh, significantly below retail rate. | Net billing tariff for new solar customers. Export credits at avoided cost rates rather than retail. Battery storage strongly incentivized to shift exports to high-value hours. New residential solar customers of IOU utilities (PG&E, SCE, SDG&E). Systems up to 1 MW. | |
Active Solar Energy System Property Tax Exclusion Expires: Jan 1, 2027 | Property Tax Exemption | California State Board of Equalization State | 100% of added value from solar excluded from property tax assessment | Solar energy systems are not assessed and do not increase property taxes. Residential and commercial properties. Systems completed before January 1, 2027. |
| Low Income | GRID Alternatives / CPUC State | Free solar installation for qualifying low-income homeowners in disadvantaged communities | Provides no-cost solar installations to low-income homeowners in disadvantaged communities. Homeowners in disadvantaged communities (CalEnviroScreen). Income at or below 80% AMI. |
Data sourced from DSIRE, EnergySage, and state energy offices. Last verified February 2026. Verify all programs directly with the administering authority.
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Programs vary by utility and municipality within California. Enter your ZIP code to see exactly which incentives apply to your address.
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Open ROI CalculatorFrequently Asked Questions
Does California have a solar tax credit in 2026?
California does not currently have a state-level solar income tax credit, but there are other incentives available such as net metering, property tax exemptions, and utility rebates. The federal residential ITC (Section 25D) expired December 31, 2025.
What is the average electricity rate in California?
The average residential electricity rate in California is approximately $0.28/kWh as of 2026. Higher utility rates generally improve solar ROI.
Does California have net metering?
Yes. California has a net metering or net billing policy that credits solar owners for excess electricity exported to the grid. See the incentives table above for current rates and program details.
Is solar equipment exempt from sales tax in California?
California does not currently offer a statewide sales tax exemption for solar equipment.
Does going solar increase property taxes in California?
No. California offers a property tax exemption for solar energy systems, meaning the added home value from solar is not included in your property tax assessment.
Did the federal solar tax credit expire?
Yes. The federal residential solar tax credit (Section 25D) expired December 31, 2025 per the One Big Beautiful Bill Act (Public Law 119-21). The commercial ITC (Section 48E) remains active at 30% for systems under 1 MW through 2032.