What is the California Self Generation Incentive Program?
The California Public Utility Commission (CPUC) began the Self Generation Incentive Program (SGIP) by offering rebates to encourage, and support, new, existing, and emerging distributed energy resources. The technologies that qualify include:
- advanced energy storage systems
- waste heat to power technologies (CHP)
- gas turbines
- wind turbines
- pressure reduction turbines
- fuel cells
- internal combustion engines.
SGIP Rebate Amount
On projects 30 kW or bigger, 50% of the California Self Generation Incentive Program will be received when the project is completed, the other 50% will be paid based on the actual kWh produced over the first five years. For projects that are under 30kW, 100% of the incentive is paid upon project completion.
- Advanced Energy Storage: $1.31/watt
- Wind Power: $1.02/watt
- Fuel Cell (CHP or Electric Only): $1.49/watt
- Gas Turbine (CHP): $0.42/watt
- Microturbine (CHP): $0.42/watt
- Internal Combustion Engine (CHP): $0.42/watt
- Waste Heat to Power: $1.02/watt
- Biogas: $1.31/watt
- Pressure Reduction Turbine: $1.02/watt
There is an additional 20 percent incentive for eligible Advanced Energy Storage and Distributed Generation technologies that are installed by a California Supplier. Projects that have a capacity greater than 1 MW, the first MW will receive 100% of the incentive rate. The first 1 MW will receive 100% of the incentive rate. The next increase in capacity above 1 MW, and up to 2 MW, will receive 50% of the incentive rate. And the last increase in capacity, above 2 MW, and up to 3 MW, will receive 25% off of the incentive rate. In qualifying projects, the California SGIP can be combined with the Federal Solar Tax Credit (ITC). This will add an additional 30% tax credit to the energy project.
Summary of the Self Generation Incentive Program
The Self Generation Incentive Program (SGIP) was started in 2001. It offers incentives to commercial and residential customers who generate electricity with advanced energy storage, fuel cells, various types of combined heat and power/cogeneration, and wind turbines. Retail electric and gas customers of Southern California Gas (SoCal Gas), Pacific Gas & Electric (PG&E), Southern California Edison (SCE), and San Diego Gas & Electric (SDG&E) are eligible for the SGIP.
The SGIP program was originally set to expire at the end of 2011. Senate Bill 412 of 2009 extended the expiration date to January 1, 2016, and Senate Bill 861 of 2015 further extended the expiration date to January 1, 2021. Any money that remains in the program funds after January 1, 2021 must be returned to the utilities to reduce ratepayer costs.