California has the largest solar market in the U.S. and has been a longtime champion of solar because of the many economic and environmental benefits it provides, including $57 billion in investment in the state. Solar supplies nearly 19 percent of California’s electricity today, but it must play a bigger role if the state is to reach climate and energy goals. Despite many successes and new policies, there is still much work to achieve California’s broader goals.
In California, property tax is re-assessed under two circumstances: when property is sold, and when new construction is added to a property.In 1980, California voters changed the state’s constitution and authorized the legislature to exclude from the term “newly constructed” the construction or addition of any “active solar energy system”. Revenue and Taxation Code Section 73 was then enacted, which excludes active solar energy systems from “new construction”. The Section 73 exclusion applies to solar systems installed through 2024.
However, a “split-roll” initiative is expected to be on the ballot in November that will require all commercial and industrial property “that is not otherwise exempt under the Constitution” to be assessed at its full cash value, determined annually. The solar property tax “exclusion” is not an “exemption” from property tax. This change would mean that all solar systems currently in place and excluded from property tax would now be subject to property tax at their full fair market value, despite the fact that voters enacted a property tax incentive decades ago to encourage the deployment of solar energy throughout the state.
Residential Solar Mandate and the Investment Tax Credit
Beginning in 2020, all new homes built in California must have solar, prompting new questions about who’s eligible take advantage of the solar Investment Tax Credit (ITC). While the specifics will depend on your situation, the solar ITC will generally go to whoever owns the system. If a homeowner buys a newly built home with solar and owns the system outright, the homeowner is eligible for the ITC the year that they move into the house. If the homeowners leases the solar system or purchases electricity from the system through a power purchase agreement (PPA), then the ITC is claimed by the company that leases the system or offers the PPA.
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SEIA California State Solar Policy Priorities
- Setting a long-term goal for renewable production, including successful implementation of SB100 through the IRP process, lobbying for legislation to accelerate procurement of utility-scale renewables, and securing full capacity value for solar in resource adequacy
- Protecting solar markets in rate cases and rate design, including protecting net metering through reasonable NEM 2.0 reforms, engagement in SDG&E general rate case Phase 2 (focusing on rates for residential and commercial customers with a particular emphasis on solar + storage rates), and residential time-of-use cases (coordinating with ratepayer advocates to fight increased fix charges for residential customers)
- Modernizing the grid to create a level playing field for solar, including creating a solar bill of rights, establishing a pilot tariff in NEM 3.0 for shared solar programs, and establishing a diversity & inclusion working group
- Incorporating solar into state codes & standards, including implementation of the Building Energy Efficiency Standards (BEES) for solar on new homes, developing BEES for commercial buildings with solar and storage, and preventing problematic siting & permitting requirements for utility-scale solar
- Establishing reasonable consumer protections for solar customers, including developing a consumer information packet at the PUC and resolving outstanding consumer complaints in the Central Valley and elsewhere
- Develop a California Clean Energy Caucus in coordination with other partner trade associations
Recent Policy Highlights
- Submitted comments in the IRP supporting a proposed procurement track to be established for summer 2019
- Engaging on AB 56, a bill that would establish a procurement entity, as well as other related legislation
- In direct talks with the Community Choice Aggregators (CCAs) about how to improve the procurement process and to collaborate more closely on market reform matters
- Intervened in PG&E’s GRC Phase 1 and is preparing testimony on PG&E’s proposed grid modernization plan and proposed NBCs related to hydro assets
For more information on SEIA's work in California, please contact Rick Umoff.
Notable Solar Installations in California
- Topaz Solar Farm was completed in 2014. This photovoltaic project has the capacity to generate 550 MW of electricity -- enough to power over 142,000 California homes.5
- Several large retailers in California have gone solar including AER Worldwide, Agilent Technologies and Airdrome Orchards. Prologis has installed one of the largest such installations with 8 MW of solar capacity at their location in Rialto.6
Check out our Major Solar Projects List for more notable installations.
Solar Companies in California
Looking for a local installer? Use SolarReviews to get company reviews and estimates for solar in your area. You can also view the average costs for installing solar in California, based on real price data from installed systems and solar quotes.
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If you're looking for information about local solar companies, check out EnergySage's list of solar companies in California, where you can check out information about each company and see real customer reviews.
California State Solar Policy Resources
California Public Utilities Commission – Learn about the governing body that regulates the electricity rates and services of California public utilities
California Solar Initiative – Read information on the solar rebate program for customers of California's investor-owned utilities
California State Energy Commission – Find a wide variety of information on state government energy programs, policy, projects, energy-saving strategies and energy-related statistics
California State Legislature – Track pending legislation affecting solar energy, locate and contact individual legislators, and stay up to date on current legislative issues in California
DSIRE Incentives Database - California – Search a public clearinghouse for specific solar energy incentives in California and across the United States
U.S. Energy Information Administration - California State Profile – Explore official energy statistics, including data on electricity supply and demand, from the U.S. government