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'''''Note: The California Energy Commission received $25 million in additional funding for this program in July 2012. The new funding is expected to clear out the queue of applications on the waiting list. Since interest in the program remains high relative to the available funding, the waiting list will remain in place and applications will be processed on a first-come, first-served basis while funds are available. See website above for the most recent status of this program.'''''

In January 2006, the California Public Utilities Commission (CPUC) adopted a program – the California Solar Initiative (CSI) – to provide more than $3 billion in incentives for solar projects with the objective of achieving participation levels accounting for 3,000 MW of solar capacity by 2017. Senate Bill 1 was signed by the Governor in August 2006, expanding the CSI to include publicly-owned utilities with a total ratepayer-funded budget of $3.5 billion.

Aside from the solar programs administered by the publicly-owned utilities, two programs serve the investor-owned electric service territories. [http://www.dsireusa.org/library/includes/incentive2.cfm?Incentive_Code=C... One is overseen by the CPUC], which provides incentives for existing residential homes and existing and new commercial, industrial, and agricultural properties. The other program, the New Solar Homes Partnership (NSHP), is administered by the California Energy Commission (CEC) and provides incentives for solar on new home construction. To be eligible for the NSHP incentive, the home must receive electricity from one of the following investor-owned utilities: Pacific Gas and Electric Company, Southern California Edison Company, San Diego Gas and Electric Company, and Bear Valley Electric Service.

Launched on January 2, 2007, the New Solar Homes Partnership (NSHP) is a 10-year, $400 million program to encourage solar in new homes by working with builders and developers to incorporate into the homes high levels of energy efficiency and high-performing solar systems. The NSHP specifically targets the market-rate and affordable housing single-family and multifamily sectors, with the goal of achieving 400 MW of installed solar electric capacity on new homes, and to have solar electric systems on 50% of all new homes built in California by the end of 2016.

Incentives are determined by the housing type and the expected performance of the system, which depends on factors like equipment efficiency, geographic location, orientation, tilt, shading, and time-dependent valuation. These factors are then compared to a reference system in San Jose, California. To qualify for incentives, the residential dwelling unit must be achieve at least 15% higher energy efficiency than the current Title 24 Building Energy Efficiency Standards (please refer to the New Solar Homes Partnership Guidebook for specific details and program requirements). The incentive is paid once the system is installed, operational, and has met all program requirements.

There are four incentive levels available:

'''''Base Incentive:''''' Expected Performance Based Incentive (EPBI) level as of September 2011 is $2.25/watt. The base incentive applies to custom homes, small developments (less than 6 homes), housing developments where solar is offered as an option, common areas of housing developments, and housing developments where solar will be installed on less than 50% of the homes.

'''''Solar as a Standard Feature Incentive:''''' The EPBI level as of September 2011 is $2.35/watt. To qualify, a builder of 6 or more homes in a development must commit to a minimum of 50% of the residential units in the subdivision or multifamily housing development, to installing solar electric systems that meet or exceed the California Flexible Installation criteria. (The California Flexible Installation criteria option was developed by the Energy Commission to make it easy to use and encourage participation by large home developers.)

In July 2007, the NSHP Guidebook was revised to include a new incentive structure to meet the needs of California’s affordable housing community.

'''''Residential Areas of Affordable Housing Projects:''''' The EPBI amount as of September 2011 is $3.15/watt. This applies to affordable housing projects of all sizes.

'''''Common Areas of Affordable Housing Projects:''''' The EPBI level as of September 2011 is $2.97/watt. This incentive level applies to solar electric systems serving the common areas of affordable housing projects.

All incentives will decline over time as specific megawatt targets are achieved. Refer to the NSHP Guidebook and contact the program administrator for complete details.