Solar incentives and rebates in California: what homeowners can still get in 2026

Solar incentives in California in 2026 are narrower than many buyers expect. There is no state solar tax credit, and the federal 25D credit does not cover systems finished after 2025. What remains is a property tax exclusion for systems completed before January 1, 2027, a small export credit adder for some PG&E and SCE customers, and larger rebates aimed at income-qualified households through SGIP and DAC-SASH.

• Property tax deadline: the Board of Equalization says the solar new-construction exclusion applies to systems completed before January 1, 2027; a 2025 bill did not extend it, and a 2026 bill to extend a narrower version stalled in committee.
• No federal credit for 2026 installs: under IRS guidance, 25D does not apply to systems completed after December 31, 2025.
• Export adder: residential PG&E and SCE customers who interconnect before the end of 2027 get a small extra export credit for nine years; SDG&E customers do not.
• Low-income programs: SGIP's Residential Solar and Storage Equity budget lists $3,100 per kW for solar and $1,100 per kWh for storage, and DAC-SASH runs through 2030.
• Municipal utilities differ: SMUD raised its solar export rate to 9.6 cents per kWh on June 1, 2026.

What solar incentives does California offer in 2026?

California does not offer a state income tax credit for home solar, and we found no statewide cash rebate open to every homeowner. Today, state support comes in four main forms:

1. A property tax exclusion, so new solar does not raise your assessed value, if the system is finished in time.
2. Export credit terms set by the California Public Utilities Commission (CPUC), including a temporary adder for some customers.
3. Rebates for income-qualified households through the Self-Generation Incentive Program (SGIP) and the Disadvantaged Communities Single-family Solar Homes program (DAC-SASH).
4. Separate rules and programs at publicly owned utilities such as SMUD and LADWP.

The sections below explain each, with the dates that matter.

California's solar property tax exclusion ends for systems finished after 2026

Under Revenue and Taxation Code section 73, an active solar energy system is not treated as new construction for property tax purposes, so it does not raise your assessed value. Its value comes from the fact that it keeps working for as long as you own the home.

The deadline is close. In an August 2024 letter to county assessors, the State Board of Equalization said the exclusion applies to systems completed before January 1, 2027. A system completed in 2027 would be assessed. A Board of Equalization analysis of Senate Bill 710, dated October 7, 2025, confirmed that the bill did not extend the exclusion past January 1, 2027. In 2026, Assembly Bill 2389 proposed a narrower extension, mainly for customer-sited systems of 10 kW or less, but legislative records show it was held in committee on May 14, 2026 with no later action.

Two points to remember:

• Once a system qualifies, it stays excluded until the property changes ownership. The BOE adds that work in progress counts if it is completed before January 1, 2027.
• "Completed" is the key word. If your installer cannot finish before January 1, 2027, ask how that changes your property tax bill before you sign.

Federal solar tax credit status in California

The federal residential clean energy credit (Section 25D) used to cover 30% of a home system's cost. The IRS now says the credit "will not be allowed for any expenditures made after December 31, 2025," and that a solar expenditure is treated as made when installation is completed. A California system finished in 2026 does not qualify. See is there still a federal solar tax credit for more.

Export credit adder for PG&E and SCE customers

New solar customers of PG&E, SCE and SDG&E take service on the Net Billing Tariff, which the utilities call the Solar Billing Plan. Exports are valued at hourly avoided-cost rates rather than retail rates. Our companion guide to net metering in California covers how that billing works.

The CPUC built in a temporary extra credit. Residential PG&E and SCE customers who interconnect before the end of 2027 receive a small export credit adder that lasts nine years. SDG&E customers are excluded, and so are homes required to add solar under the building code. SCE calls it the Energy Export Bonus Credit and says eligible residential customers who enroll before 2028 get roughly $0.04 per kWh extra, and income-qualified customers roughly $0.09 per kWh. It is a modest boost, but it has a firm deadline.

SGIP and DAC-SASH: California solar rebates for income-qualified homes

Self-Generation Incentive Program (SGIP)

SGIP mostly pays for batteries. Its newest residential budget, Residential Solar and Storage Equity, pairs solar with storage for low-income residential customers. The CPUC lists:

• $3,100 per kW for solar and $1,100 per kWh for storage;
• $280 million authorized;
• reservations that opened June 2, 2025.

Several other residential SGIP budgets, such as Equity Resiliency and Small Residential Storage, were listed as available only through 2025. Check the SGIP site for which budgets still have funds. Our guide to battery storage incentives has more on storage.

DAC-SASH

DAC-SASH helps income-qualified homeowners in disadvantaged communities go solar. GRID Alternatives, which runs it, lists these rules:

• Electric service from PG&E, SCE or SDG&E.
• Household income at or below CARE or FERA limits. For 2026–2027, the limit is $54,100 for one or two people and $82,500 for four.
• A single-family home you own and live in as your primary residence, located in a red-shaded disadvantaged community on the CalEnviroScreen 5.0 map.
• The program runs through 2030.

California solar incentives at a glance

Incentive	Who qualifies	Key date
Property tax exclusion (section 73)	Homeowners adding active solar	System completed before Jan 1, 2027
Federal 25D credit	All U.S. homeowners	Not allowed for expenditures after Dec 31, 2025
Solar Billing Plan export adder	Residential PG&E and SCE customers	Interconnect before end of 2027; lasts nine years
SGIP Residential Solar and Storage Equity	Low-income residential customers	Reservations opened June 2, 2025; check funding
DAC-SASH	Income-qualified owners in disadvantaged communities	Runs through 2030
SMUD Solar and Storage Rate	SMUD customers	9.6¢/kWh export rate from June 1, 2026

Solar incentives from California municipal utilities

Many Californians are served by city or district utilities rather than PG&E, SCE or SDG&E, and those utilities set their own solar rules. The Sacramento Municipal Utility District (SMUD) is one example. On April 27, 2026, SMUD announced it would raise the export rate on its Solar and Storage Rate from 7.4 to 9.6 cents per kWh starting June 1, and said it would revisit the rate every four years. If you are served by LADWP, Riverside, Glendale or another city utility, ask for its current solar tariff in writing.

Common California solar incentive mix-ups

Because California's rules have changed several times since 2023, sales pitches and online calculators are often out of date. Watch for these:

• A 30% federal credit in the savings estimate. For a home system completed in 2026, it does not apply.
• Retail-rate export credits. New PG&E, SCE and SDG&E customers are on the Solar Billing Plan, not NEM 2.0.
• Assuming the property tax break will be extended. As of November 2026 we found no law extending it, so it still ends for systems completed on or after January 1, 2027.
• Counting an SGIP rebate before reserving it. SGIP money is reserved per project and budgets can run out, so confirm a reservation before you rely on it.
• Treating DAC-SASH as open to everyone. It is limited to income-qualified owners in disadvantaged communities.

How to get the most from California solar incentives

1. Lock in your completion date. Put a completion target before January 1, 2027 in writing if you want the property tax exclusion.
2. Check income programs first. If your household may meet CARE or FERA limits, look at DAC-SASH and SGIP before you buy at full price.
3. Use the right rate. Make sure your quote values exports at Solar Billing Plan rates, not retail.
4. Compare offers. Look at cost per watt, equipment and warranties, not only the monthly payment.

Our California solar panel page shows typical output, and the California electricity rates page compares local prices with the U.S. average of 18.16¢ per kWh.

Next steps

Decide quickly if the property tax exclusion matters to you, since the clock runs out for systems not finished by January 1, 2027. Then get two or three quotes and test them with the solar quote checker.