The California Public Utilities Commission’s program is called the California Solar Initiative (CSI). There are several aspects to this program. They cover solar energy installation on existing homes, existing and new commercial buildings, agricultural applications, government and non-profit buildings. This program also has a rebate for the installation of solar hot water systems for homes and businesses.

The goal of this system is to encourage the installation of high performing solar systems. As a result, the performance of the system, where it has been installed, the angle and tilt of the panels are all factored into the rebate. The CSI general program has a budget of $2.167 billion over 10 years and the goal is to reach 1,940 MW of installed solar capacity by the end of 2016.

Calculating the Rebates

To get started an energy efficient audit is done to establish any existing energy consumers that are currently in place. Having done this, the size of the new system is determined. The rebate is calculated on an Expected Performance-Based Buydown (EPBB) system. This calculation determines the amount of solar energy that your system will produce on an annual basis. As energy is measured in kilowatt-hours (kWh) the calculation is done by taking the number of kWh produced times a dollar amount. In Orange County this amount will vary between $0.25 – $1.65 per kWh and will allow for a one-time rebate depending on the size of the system installed.

This rebate can be deducted from the installation cost of the system.

It is possible that the PBI (for commercial properties) rebate system will make more sense for your solar energy project. In this system, rather than a one-time lump sum rebate, there are five annual payments. The solar system has to be monitored for actual performance rather than anticipated performance. This rebate program is used for systems over 30kW in size.

Tax Credits

The Federal government has helped to make the installation of solar systems very attractive. By an investment tax credit 30% of the solar system’s cost can be deducted from your federal tax return. This tax incentive is in place until 2016. The tax credit includes both the cost of the equipment plus the cost of the installation labor. There is no maximum on the amount of credit for active solar systems. It is also possible to carry the credit forward into the next five tax years.