California Clean Energy Programs: Rebates, Discounts, and Grants

California clean energy rebates and incentives in 2026 still include monthly utility bill discounts, no-cost home weatherization, battery storage rebates worth thousands of dollars, heat pump rebates when funding reopens, and grants of up to $12,000 for income-qualified residents buying a cleaner vehicle. Several programs Californians relied on for years have closed: the state’s Clean Vehicle Rebate Project stopped taking applications in November 2023, and federal tax credits for solar, batteries, and clean vehicles ended in 2025 under the One Big Beautiful Bill. What follows is what you can still apply for, who qualifies, and where funding currently stands.

Monthly Bill Discounts Through CARE and FERA

Two utility-administered programs cut monthly bills for income-qualified households on an ongoing basis. The California Alternate Rates for Energy (CARE) program reduces electric bills by 30% to 35% and natural gas bills by 20% for households at or below 200% of the federal poverty level.¹ Smaller utilities with fewer than 100,000 customer accounts offer a flat 20% electric discount instead.

The Family Electric Rate Assistance (FERA) program picks up where CARE leaves off, providing an 18% electricity discount for households whose income sits between the CARE ceiling and 250% of federal poverty guidelines.¹ A household of four qualifies for FERA at income between $64,301 and $80,375 for 2025–2026. One application covers both programs.

Enrollment isn’t permanent. You must recertify income every two years, or every four years on a fixed income.² Miss the deadline and the discount stops. Utilities don’t backdate the credit once you reapply.

Free Weatherization Through the Energy Savings Assistance Program

The Energy Savings Assistance Program (ESA) covers the full cost of efficiency upgrades for households meeting CARE or FERA income thresholds. Income limits for 2025–2026 run from $39,125 for a single person to $80,375 for a household of four.³ Both homeowners and renters qualify.

Services vary by utility but commonly include attic insulation, energy-efficient refrigerators and furnaces, weatherstripping, caulking, low-flow showerheads, water heater blankets, and repairs that seal air leaks.³ Participants don’t repay anything. Contact your utility directly to schedule an assessment.

Battery Storage Rebates Through SGIP

The Self-Generation Incentive Program (SGIP) pays per-kilowatt-hour rebates for energy storage systems at homes and businesses, and it remains among the most generous battery incentives available in any state.⁴ The highest tiers go to low-income households and residents in high fire-threat areas subject to Public Safety Power Shutoffs.

Rebate rates by category:

Equity and San Joaquin Valley Residential: $1,100 per kWh of storage, plus $3,100 per kW of paired solar
Equity Resiliency (fire-threat and PSPS zones): $1,000 per kWh
Small Residential Storage (general market): $150 per kWh

The gap between market and equity rates is enormous. At the equity rate, a typical 13 kWh home battery could qualify for over $14,000 in rebates, often covering most of the installed cost. The same system at the general market rate would receive around $1,950.⁵ Check whether you qualify for an equity or resiliency budget before applying under the general tier.

Funding fluctuates. As of early 2026, several SGIP equity budget categories are closed to new applications or running waitlists, particularly in Southern California Edison and PG&E territories.⁵ Budget status is posted on the SGIP program metrics page and shifts as projects close out.

Heat Pump Rebates: What’s Paused, What’s Coming

Two programs drive California’s push toward electric heat pumps for heating, cooling, and water heating. Both are currently constrained by funding.

TECH Clean California

TECH Clean California, run by the California Energy Commission, pays rebates for heat pump HVAC systems, heat pump water heaters, and air-to-water heat pumps. Market-rate heat pump water heater rebates range from $1,100 in Northern California to $2,100 in Southern California, and bonuses for larger capacity units and low-GWP refrigerants can push totals to $3,300 or $4,300. Income-qualified households can receive up to $5,700 for the same equipment. Market-rate HVAC rebates run $1,000 to $1,500, with up to $4,000 for equity-eligible households.⁶

As of early 2026, TECH Clean California is no longer accepting new heat pump HVAC or heat pump water heater reservations statewide.⁶ Watch the program site for new funding rounds.

HEEHRA

The High-Efficiency Electric Home Rebate Act (HEEHRA) is a federal Inflation Reduction Act program that California began administering through TECH Clean California in October 2024.⁷ HEEHRA rebates apply at the point of sale rather than as tax credits. Amounts depend on income relative to area median income (AMI):

Below 80% AMI: up to 100% of project costs
80% to 150% AMI: up to 50% of costs
Above 150% AMI: not eligible

Federal per-upgrade maximums include $8,000 for a heat pump HVAC system, $1,750 for a heat pump water heater, $4,000 for an electrical panel upgrade, $2,500 for electric wiring, and $1,600 for insulation and air sealing. The per-household cap is $14,000.⁷

As of February 2026, HEEHRA Phase I single-family rebates are fully reserved statewide. No new income verification requests are being accepted, and unfulfilled requests sit on a waitlist. Phase II hasn’t been announced.⁷ HEEHRA is only available through HEEHRA-trained contractors and requires preapproval before any work begins. Projects started without an approved reservation won’t receive funding.

Solar and the Net Billing Tariff

Rooftop solar economics changed in April 2023 when the CPUC replaced Net Energy Metering with the Net Billing Tariff (NBT), sometimes called NEM 3.0.⁸ Under the old system, excess solar sent to the grid earned credits close to the retail rate. NBT credits exports based on the CPUC’s Avoided Cost Calculator, which tracks what that energy is actually worth to the grid at the time it’s delivered.⁹

In practice, export credits usually sit well below the retail rate, though they can spike above it on late summer evenings when grid demand peaks.⁹ Batteries matter far more than they did under the old system. A homeowner with storage can hold midday solar and use it during evening peak hours instead of exporting cheap and buying back expensive. Model any new solar project with a paired battery, not solar alone.

Clean Vehicle Grants for Income-Qualified Buyers

The Clean Vehicle Rebate Project (CVRP), which once paid up to $7,500 for a new zero-emission vehicle, stopped accepting applications in November 2023.¹⁰ Two state programs remain active for lower-income residents.

Clean Cars 4 All

Clean Cars 4 All gives grants to low-income residents who scrap an older, high-polluting vehicle and buy a cleaner one. Household income must sit at or below 300% of the federal poverty level.¹¹ Grants by vehicle type:

Zero-emission vehicle: up to $10,000, or $12,000 in a disadvantaged community
Plug-in hybrid: up to $9,500, or $11,500 in a disadvantaged community
Zero-emission motorcycle: up to $7,500
Mobility option such as transit passes: up to $4,500, or $6,500 in a disadvantaged community

Vehicle purchasers can also receive up to $2,000 toward home charging equipment or a prepaid public charging card. The replacement vehicle must be eight model years old or newer.¹¹ Not every air district participates, so availability depends on where you live.

Driving Clean Assistance Program

The Driving Clean Assistance Program (DCAP) provides grants and affordable financing for income-qualified residents. Grants reach up to $12,000 for residents of disadvantaged communities who scrap an older vehicle, plus up to $2,000 for charging. Residents without a vehicle to scrap can still qualify for up to $7,500 in a disadvantaged community.¹²

DCAP also offers low-interest loans capped at 8% APR with a $45,000 loan limit.¹² Applicants can’t have previously participated in another CARB light-duty vehicle purchase incentive program.

Home Charging

Regional air quality districts and local utilities offer rebates for installing Level 2 EV chargers at home. Amounts range from a few hundred to several thousand dollars depending on the utility and any income-based adders. These offerings change frequently, so check with your utility directly.

Federal Tax Credits That Ended in 2025

The One Big Beautiful Bill, signed into law on July 4, 2025, terminated or accelerated the phase-out of several clean energy tax credits Californians had been combining with state incentives. This changes the total math on new projects.

The Residential Clean Energy Credit (Section 25D), the 30% credit on solar panels, battery storage, and other residential clean energy installations, is not available for property where installation was completed after December 31, 2025.¹³ Systems installed and operational by that date can still claim the credit on 2025 returns. Systems finished in 2026 don’t qualify, regardless of when you signed the contract or paid a deposit.¹⁴

The new and used clean vehicle credits (Sections 30D and 25E) ended for vehicles acquired after September 30, 2025. The only exception is buyers with a binding written contract and payment made by that date; they can still claim the credit if the vehicle is delivered afterward.¹⁴ The same legislation modified the Energy Efficient Home Improvement Credit (Section 25C) and the alternative fuel vehicle refueling property credit (Section 30C). Effective dates differ by provision, so check the IRS FAQ page for each credit’s current status.

The loss of the 30% federal solar credit rewrites the math on new rooftop solar in California. Projects that once penciled out with SGIP plus the federal credit now rely on SGIP alone (when funding is open) plus the self-consumption savings under the Net Billing Tariff. Ask your installer to run updated projections before signing.

A Warning on PACE Financing

Contractors often pitch Property Assessed Clean Energy (PACE) financing alongside rebates. It’s not a rebate. PACE lets homeowners fund energy efficiency, renewable energy, and water conservation improvements through an assessment added to the property tax bill.¹⁵ Because repayment is attached to the property, the obligation can transfer to a future buyer.

PACE creates a lien on the home. That lien can make the property harder to sell or refinance, and mortgage lenders often require the PACE balance to be paid off before approving a refinance, which can run into thousands of dollars. California law requires PACE administrators to verify a homeowner’s ability to pay based on income, assets, and existing debt before approving financing.¹⁶

The California Department of Financial Protection and Innovation warns that some contractors have misrepresented PACE, claiming no money down or leaving the impression the program is free.¹⁵ It isn’t. PACE is long-term financing that accrues interest and shows up on your tax bill for years. Ask for a paper contract, and review the total repayment amount including interest before you sign.

1
California Public Utilities Commission. CARE/FERA Program
2
PG&E. California Alternate Rates for Energy (CARE)
3
California Public Utilities Commission. Energy Savings Assistance
4
California Public Utilities Commission. Self-Generation Incentive Program
5
SGIP. Program Metrics
6
TECH Clean California. Single Family Incentives
7
California Energy Commission. Inflation Reduction Act Residential Energy Rebate Programs
8
California Public Utilities Commission. NEM Revisit Proceeding
9
California Public Utilities Commission. Net Energy Metering and Net Billing
10
California Air Resources Board. Clean Vehicle Rebate Project
11
California Air Resources Board. Clean Cars 4 All
12
California Air Resources Board. Driving Clean Assistance Program
13
Internal Revenue Service. Residential Clean Energy Credit
14
Internal Revenue Service. FAQs for Modification of Sections 25C, 25D, 25E, 30C, 30D, 45L, 45W, and 179D Under the One Big Beautiful Bill
15
California Department of Financial Protection and Innovation. PACE – Property Assessed Clean Energy
16
California Legislative Information. AB 1284 California Financing Law