How to Take Advantage of the SGIP Rebate Incentive Program in 2018

By Scott Laskey


Last Updated on January 25, 2021 by Jeremy Pearl
May 09

Are you taking advantage of every stimulus initiative available for your solar power upgrade project? If not, then you may be missing out on significant financial benefits.

The California Self Generation Incentive Program, or SGIP, isn’t specifically geared towards solar. Make no mistake, however, because this rebate has the potential to reduce your upfront costs. Here’s how you might benefit.

What Is the California Self Generation Incentive Program?

SGIP is an initiative designed to support distributed generation. This program maintained by the California Public Utilities Commission, or CPUC, offers rebates for behind-the-meter energy storage and generation projects in the PG&E, SDG&E, SCE and SoCalGas territories.

From the outset, legislators designed SGIP to reduce peak loading on utility grids during high-demand periods. It initially applied to solar photovoltaic power projects and a range of other devices, such as waste heat generators, wind turbines and fuel cells. Today, there are more stringent requirements to get the rebate, but your solar panels in Monterey, Santa Cruz or the Bay Area might still be eligible.

As the program evolved, it shifted its focus to systems that also stored energy instead of only generating it. If your system adheres to the spirit of the SGIP program by including a technically compliant storage device, such as an approved solar battery, then you can earn a rebate.

Which Residential Solar Panel Systems Are Eligible for SGIP?

The SGIP initiative considers various factors to determine your eligibility and the size of the rebate that you receive, such as:

  • The currently active program step, which consists of five subscription tiers
  • The kWh energy capacity of the system in question
  • Whether or not you claim the investment tax credit, or ITC
  • The way your grid-connected storage system is cycled and used, and
  • The system’s kW power capacity.

Other important criteria include the fact that your system must be new and certified to meet CPUC standards for operating in parallel with the grid. As the 2017 SGIP Handbook notes, the rules also govern technical details like what kind of metering equipment you must install.

Understanding Usage Rules

In order to retain its SGIP eligibility, your solar panels’ battery system needs to be in regular use. This requirement makes sense considering the goal of reducing peak grid demand. Residential consumers must full-cycle discharge their batteries 52 times annually, or about once a week.

Meeting these requirements is easier with certain solar contractors than others. For instance, our second-generation Tesla Powerwall ships with the appropriate cycles already preprogrammed so that you don’t have to deal with figuring out when to discharge stored energy.

How Much Do SGIP Applicants Receive?

The state funds SGIP with a predetermined amount of money for rebates. At the time of this writing, some $566 million has been authorized through 2019. Of that sum, a full 79 percent was allocated to funding energy storage projects. 13 percent of that amount goes to small-scale projects, like batteries that attach to residential solar panels and supply less than 10 kW.

Each SGIP step receives a certain amount of money from the total pool. When these funds are exhausted, the program graduates to the next round.

CPUC calculates the amount of rebate money that you can obtain at each step in dollars per kilowatt-hour. This rate decreases with every tier, and the speed at which the individual steps become fully subscribed impacts the size of the drop.

How Do You Apply for SGIP Incentives?

SGIP funding resets annually. In 2017, CPUC began formally accepting online applications for Step 1 funding on May 1, although early birds were allowed to start filling out the forms in mid-April.

Due to its popularity, the program includes a lottery system in case day-one applications surpass available Step 1 funding. Those selected during the lottery can receive reservations. Even if they’re not quite so lucky, applicants can still reapply in the subsequent rounds.

The initiative also implements pauses between each step. During these 20-day periods, the program doesn’t accept new applications while the SGIP administrators determine the size of the rate decrease and whether to hold the lottery.

Your consumer choices also impact your wait times and incentive eligibility. For instance, if you work with local solar companies that have been through the procedure before, you’ll probably find it simpler to provide the required application information. Features like the kinds of inverters, controllers and other hardware that you install impact your approval likelihood, so it’s best if your solar provider already has all of the paperwork in order.

Should You Apply for SGIP?

With hundreds of millions of dollars’ worth of rebates already doled out, the California Self Generation Incentive Program is bringing solar power storage within closer reach for many Central Valley homes and businesses. If you’re thinking about using an advanced energy storage system to make your solar panels more convenient, then applying for SGIP is a smart idea.

Sandbar Solar is proud to help Californians use SGIP to lower the cost of their residential solar panels. As one of the leading Santa Cruz, Monterey and San Jose solar companies for over a decade, we love providing ethically sound solutions that make community-based environmental stewardship a reality. Discover how we can put 13 years of local ownership and a deep-seated investment in renewable power to work for you.

About the Author

Scott is the founder of Sandbar Solar & Electric. With a Bachelor’s Degree in Economics from UC San Diego, Scott has an NABCEP certification, and has lectured on and taught many high-tech construction practices and solar PV technical concepts to education institutions, including Stanford University and state-recognized electrician apprenticeship programs. Scott enjoys sharing his knowledge of the evolving renewable energy space and making a difference in his community.