sgip program updates 2020

SGIP 2020 program updates: what you need to know

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(Updated November 2020)

California’s Self Generation Incentive Program (SGIP) is one of the first incentives for battery energy storage in the country. The program has been very successful, helping California to lead the nation in residential energy storage deployment. Recently, the program has received additional funding, with a slightly revised charter for how to use those funds. Below, we detail the adjustments to SGIP and how it will impact individual, residential solar + storage shoppers in California. 

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SGIP in a nutshell

As described in greater detail in our SGIP-specific article, SGIP provides incentive payments to customers in California that install energy storage systems. Specifically for residential consumers, SGIP provides an upfront rebate based on the amount of stored energy in the battery you install.

The incentive program is a tiered-block program, meaning that the level of incentives gradually decline over time as more batteries are installed in the state. This certainly leads to a first-mover opportunity to receive the highest level of rebates by being the first to act; however, given that the cost of energy storage has declined significantly over the last five years, California customers can be certain that SGIP continues to provide a sizeable rebate for installing energy storage. 

For residential customers, SGIP is currently in Step 6, which provides a rebate of $200 per kilowatt-hour (kWh) of stored energy. According to California’s distributed generation statistics portal, the two most popular batteries in the state at present are the Tesla Powerwall 2 and the LG Chem RESU 10H. With usable energy capacities of 13.5 kWh and 10 kWh, respectively, Step 5 of SGIP would provide between a $2,000 and a $2,700 rebate for purchasing a new battery in California.

Funding levels increased

In 2018, California Senate Bill 700 authorized and directed the California Public Utilities Commission (CPUC) to extend and fund SGIP for an additional five years beyond its original expiration date of January 1, 2021. Over the next two years, the CPUC deliberated the amount of funds to direct towards the re-invigorated SGIP, with a final decision coming during January 2020. 

Ultimately, the CPUC adopted a decision that approved the additional funding of SGIP by injecting a further $675 million into the program over the next five years. Combining that with carryover funds from the previous round of funding for SGIP means that there are now over $1 billion in SGIP incentives available in-state. 

Adjustments to program budgets

However, given the increased threat from wildfires in California and the increasing prevalence of Public Safety Power Shutoffs (PSPS) throughout the state, the CPUC’s decision on the delivery of additional funds under SGIP is geared towards providing batteries to those customers who are most at risk of blackouts and power shutoffs. 

In fact, nearly 60% of the current $1.056 billion program budget for SGIP is dedicated for “Equity Resiliency” projects. These projects are for people who meet one of a few specific qualifications: low-income customers, customers living in high fire risk areas, customers who experienced PSPS events on two or more distinct occasions, and critical facilities that provide services to these affected areas. 

For customers who live in these areas and who are eligible for the Equity Resilience incentives, adding storage is not only a potential necessity of geography but now a financial no-brainer: the Equity Resilience incentive is at a level of $1,000 per kWh, meaning it should cover the entire installed cost of any residential energy storage system available on the market today. 

How many batteries will be funded by the revised program?

At a $1,000 per kWh incentive rate for qualified Equity Resilience customers, the $613 million in incentives would fund between 45,000 and 60,000 batteries for disadvantaged customers and customers in high-fire risk areas. 

The revised SGIP funding also sets aside $60 million for standard residential projects. If all of these funds were paid out at the current block rate of $200 per kWh, that would fund between 22,000 and 30,000 additional batteries, depending upon how much of that budget remains after dropping down to Step 6. Given that there are nearly 25,000 residential energy storage systems currently installed in California, the increased funding in SGIP will at a minimum increase overall battery deployment in the state fourfold.  

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Regardless of whether or not you live in California, you can start seeing savings by installing a solar or a solar plus storage system today. To receive free, custom quotes from local solar installation companies in your area, register for a free account on the EnergySage Marketplace

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About Spencer Fields

Spencer is the Manager of Market Strategy & Intelligence at EnergySage, where he writes about all things energy. Prior to joining EnergySage, he spent five years at Synapse Energy Economics, providing environmental, economic and policy analysis for public interest groups. Spencer has degrees in Environmental Studies and Hispanic Studies from Brown University, meaning when he's not in the office you can find him outside or traveling somewhere to work on his Spanish.

24 thoughts on “SGIP 2020 program updates: what you need to know

  1. AvatarKirill

    I am SO confused about the SGIP. One solar rep told me it costs about $500 to apply and it will get denied because I don’t live in a fire hazard area because the funding ran out. Is that true?

    Reply
  2. AvatarJUDITH A SULLIVAN

    We are connected to PGE but are installing an ‘off grid’ solar/battery system that will only run our deep well and refrigerators/freezers on a daily basis. The system will not generate anything to PGE. We are in a wildfire area (zip 93667 – evacuated for two weeks this past Sept due to the Creek Fire), have had 2 or three PSP shutoffs in the past two years and depend on our 435′ deep well for all water. The battery storage system will be over 10k…..our installer said that might be an issue. Will we qualify for the battery rebate – or does it only apply if the system is plugged in with PGE?

    Reply
  3. AvatarAndrew Nguyen

    My SGIP application was just rejected due to “the residential storage “soft target”. Acceptance has been paused for residential customers who do not live in a Tier 3 or Tier 2 HFTD.”

    This is unfortunate, because I literally live right on the border according to the webmap (https://www.arcgis.com/home/webmap/viewer.html?webmap=951707c35bcf430688aa710f771c063c&extent=-127.7521,29.6278,-106.2189,43.1786)

    The rejection email says “You may re-submit the application for a lower incentive rate when the next step opens”.
    I would assume this is step 7.

    Dose any know what the incentive rate is for step 7 and how is it compared to step 6? Or when Step 7 starts so I can re-submit the application?

    Reply
  4. AvatarAlex Thomson

    I would be happy to assist you on the cost and benefit of installing Batteries through the SGIP and Equity Resiliency Programs. I am familiar with both avenues and can help with application submittal etc..

    Reply
    1. AvatarAaron E Schuller

      Hey Alex, I’m hoping to find the answer to a question. What’s the difference between Small residential storage and residential storage equity? basically, would my rebate be .20/Wh or .85/Wh. Currently looking to add an LG RESU 9.8kwh battery 5.75 kw system. also if im planning to discharge from 3-9 pm my duration would be 6 hrs @.20/wh or .85/wh. sny clarification helps

      Reply
    2. AvatarLynda Hernandez

      I do not meet the criteria for low income (I don’t think) or live in a fire hazard region or have experienced two power outages. I am in the process of purchasing a Tesla Powerwall2 and am interested in the CA SGIP 2020 incentive program ($200.00 rebate per watt stored). I am an SCE customer but was not able to locate any information about the SGIP program on their rebate website. Am I out of luck or do I have to install with a particular installer? I have committed to using SunPower since my solar system is that brand (installed 13 years ago). Please advise and thank you in advance!

      Reply
      1. AvatarAndrew Nguyen

        Im in the same boat. I was just rejected “due to the residential storage “soft target”. Acceptance has been paused for residential customers who do not live in a Tier 3 or Tier 2 HFTD, or who did not have their electricity turned off in two more discrete PSPS events prior to applying for SGIP incentives”.

        If I knew about this, I probably would have thought twice about getting the 2nd battery.

        The rejection email says to re-submitt in the next step (Step 7). But im not sure when that is or what the rates are.

        Dose anyone know this?

    3. AvatarMichael Pitner

      Hello Alex. I would love some help with this. I’m currently getting a solar roof with Tesla and 2 PW’s. We are a medical baseline family and have had 2 PSPS shutoffs. Tesla seems to be behind in getting applications submitted. Am I able to do it myself? Or am I at the mercy of them? What if they just don’t submit? There has to be a way around this.

      Reply
  5. AvatarJerry Dunton

    Hi Spencer, I recently went under contract with a three battery Tesla powerwall as a back up to our
    12.8 kWp solar system. I live in a Tear 2 fire zone and have a medical baseline allowance with SDG&E in So. California. It really does not make financial sense unless I can qualify for the SGIP 1000 kW rebate. I do not have confidence that Tesla will process or insure this rebate for me. Are there any reliable independent consultants that one could contract with for this process? If I cannot be assured of the rebate, it’s a No-Go from a financial standpoint as much as I’d like to have the battery backup system and source to best allocate usage as I am on EV-TOU-5 with two Tesla vehicles. I really appreciate your thoughts and expertise! Jerry

    Reply
    1. AvatarRaj D

      Jerry

      I’m facing the same dilema as I live in Tier 2 and have medical baseline. In addition, I.m required to upgrade my main panel from 100 Amp to 200 Amp (The cost I got was $12k to 18K from Tesla, who I’m extremely disappointed because they gave me this estimate WITHOUTcoming to job site,). Others have gave estimate from $2,900 to $ 4,000. SINCE,I’m in the construction idustry I think it should be $ 2,500 to $ 3,800. If I can’t find a installer that will provide cost proposal THEN I’m just going to trash the idea of solar panels and continue paying PG&E. This way I don’t have to pay a large amount (I got cost from $ $55,000 to $ 80,000).

      Any thought on this matter.

      Roger

      Reply

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