San Jose, CA Solar Panels

California’s Property Tax Exemption for solar energy systems protects homeowners from paying additional property taxes when they install solar panels. Normally, home improvements that increase your property’s value result in higher property tax bills. However, this state tax exemption ensures that the added value from your solar installation—which can be tens of thousands of dollars—won’t increase your annual property taxes. This means you keep more money in your pocket each year while enjoying the benefits of clean energy.

The exemption applies to both residential and commercial solar installations in California, and there’s no cap on the amount of added value that can be exempted. The exemption is currently available for solar systems installed through 2026, though California has historically extended this benefit. To qualify, your solar system must be designed primarily to produce electricity for on-site use. It’s important to note that this exemption only applies to property taxes—your solar system will still add value to your home when you sell it, but you won’t pay higher property taxes while you own it. This incentive works alongside other California solar benefits to make clean energy more affordable for homeowners.

The Disadvantaged Communities Single-Family Affordable Solar Homes (DAC-SASH) Program is a California state initiative designed to make solar energy accessible to homeowners in disadvantaged communities. This program provides upfront financial incentives to help offset the cost of installing a solar energy system, making clean energy more affordable for qualifying households.

Eligible homeowners can receive up to $3 per watt in capacity-based incentives. For example, a typical 5-kilowatt solar system could qualify for up to $15,000 in upfront incentives. To qualify, you must own and live in your home, receive electrical service from Pacific Gas & Electric (PG&E), Southern California Edison (SCE), or San Diego Gas & Electric (SDG&E), be enrolled in or eligible for the CARE or FERA income-qualified utility bill assistance programs, and live in a designated disadvantaged community area.

There are no specific deadlines mentioned for this program, but funding availability may be limited. If you think you might qualify, you can check your eligibility and apply through GRID Alternatives, the organization that administers the DAC-SASH program. This incentive can be combined with other available programs to further reduce the cost of going solar.

The Equity Fund is a $630 million battery storage incentive program established in 2022 under Assembly Bill 209 as part of California’s Self-Generation Incentive Program (SGIP). This program provides rebates to help low-income Californians afford battery storage systems, making clean energy backup power more accessible to communities that need it most.

Eligible homeowners can receive rebates of $150, $850, or $1,000 per kilowatt-hour of battery capacity installed, depending on their circumstances. The higher rebate rates ($850-$1,000/kWh) are available to customers enrolled in the CARE or FERA utility discount programs, residents of Disadvantaged Communities, California Tribal communities, and those living in areas with high wildfire risk or frequent power outages. To qualify, you must be enrolled in or eligible for California’s CARE/FERA programs, live in a designated Disadvantaged Community, or reside in a California Tribal area. Your home must also receive electricity service from Pacific Gas & Electric (PG&E), Southern California Edison (SCE), or San Diego Gas & Electric (SDG&E).

This incentive pairs well with California’s NEM 3.0 net billing program, where battery storage helps you maximize the value of your solar energy. Customers in CARE or FERA programs also receive ongoing electric bill discounts of approximately 35% and 18% respectively. Since rebate amounts are based on battery capacity and funding is limited, it’s worth exploring your eligibility sooner rather than later.

Net Billing in California is a program that credits you for the excess solar energy your system sends back to the electric grid. Unlike older net metering programs that credited you at full retail rates, Net Billing (also called “NEM 3”) provides export credits based on the time of day and the utility’s avoided cost—essentially what it would have cost them to generate that power. The credit value changes every hour, with higher rates typically during peak demand periods and lower rates during times when solar production is abundant across the grid.

The financial benefit varies significantly by utility and timing. For the three major investor-owned utilities (PG&E, SCE, and SDGE), Net Billing began April 15, 2023, and export credits are calculated hourly using each utility’s Avoided Cost Calculator. Any unused credits remaining at your annual anniversary month are paid out at approximately 3-5 cents per kilowatt-hour. Imperial Irrigation District offers a simpler monthly settlement at $0.0698 per kWh, while Sacramento Municipal Utility District credits exports at 7.4 cents per kWh with monthly settlement. LADWP operates under traditional 1:1 net metering with credits that roll over indefinitely as dollar credits on your account.

If you submitted a complete interconnection application by April 14, 2023, you may qualify for the more favorable NEM 2.0 program instead. However, you cannot increase your system size at all, or decrease it by more than 20%, without losing NEM 2.0 status and moving to Net Billing. For new applications after April 15, 2023, Net Billing is the standard program. Because export credits under Net Billing are generally lower than retail electricity rates, maximizing your self-consumption of solar energy—using power when you generate it—becomes especially important for your financial return.