Home batteries in California under net billing: savings, backup and incentives
Under net billing, a home battery earns its place by storing midday solar, when exports earn least, for the evening, when grid power costs most, and by keeping chosen circuits running in an outage. Incentives are thinner than they were: the state’s SGIP residential budgets are closed or waitlisted, and the federal credit for homeowners who buy a battery ended with 2025. Plan around evening use and backup, and treat any incentive as a bonus.
Why does net billing make a battery more useful?
Under the net billing tariff, power you export earns credits at values set by the California Public Utilities Commission (CPUC) that change by the hour and are usually well below the price of grid power. Solar customers are on a time-of-use rate whose highest prices fall in the late afternoon and evening, typically 4 p.m. to 9 p.m., just as solar output fades.
PG&E’s own guide puts the logic plainly: charge the battery with excess solar when energy prices are lower, and use the stored energy from 4 p.m. to 9 p.m., when they are higher. Export credits are also higher in those hours, and on some late-summer evenings they can rise above the retail price, so a battery can be set to export then.
What does a battery do through the day?
A typical day for a home with solar and a battery set to save on the bill:
| Time | Solar | Battery | Grid |
|---|---|---|---|
| Morning | Starting to produce | Covers what solar cannot, if charge remains | Supplies the rest |
| Midday | Produces more than the home uses | Charges from the surplus | Receives what the battery cannot store |
| 4 p.m. to 9 p.m. | Output falls away | Powers the home, keeping a reserve for outages | Little or nothing bought at peak prices |
| Night | None | Holds its reserve | Supplies the home at lower prices |
Illustrative. What a battery does depends on its settings, its size and your rate plan.
Will a battery keep the power on in an outage?
Solar alone will not. SCE puts it directly: a grid-tied solar system does not provide power during outages unless it includes battery storage, because it shuts down for safety. With a battery installed for backup, the home can separate from the grid and keep running on stored and solar power.
That matters during Public Safety Power Shutoffs, when utilities turn off power to specific areas to reduce the risk of fires caused by electric equipment. Decide in advance which circuits the battery should carry, such as the refrigerator, lights, internet or a well pump, and how much charge to hold back for outages; the more you reserve, the less is left for evening savings.
If you are offered solar with storage, the bill-savings estimate on the CSLB disclosure document must include a scenario with the battery set to maximize savings, using the same minimum reserve as any other scenario shown.
Which incentives are open now?
Fewer than in recent years. This was the position on November 3, 2026:
- SGIP, the state’s storage incentive: residential budgets are closed to new applications, apart from the Residential Solar and Storage Equity budget for income-qualified households, which is fully reserved with a waitlist at PG&E, SCE and SDG&E.
- PG&E’s Permanent Battery Storage Rebate: a one-time rebate for customers buying their first permanent battery who have had five or more wildfire safety outages since January 1, 2024, and who join a time-of-use rate and the Emergency Load Reduction Program. About 118 rebates remained on October 30, and applications close December 31, 2026.
- Portable backup: PG&E and SCE offer rebates on portable batteries or generators to eligible customers in high fire-risk areas; PG&E’s program runs until December 31, 2026.
- Federal: the credit for homeowners who buy a battery ended for batteries installed after December 31, 2025. A battery owned by a company under a lease or PPA can still qualify for a business credit, on a longer schedule than solar.
- Grid emergency payments: some programs pay battery owners, usually through the battery provider, for power delivered during grid emergencies, but their funding and rules change. The utilities’ residential Power Saver Rewards ended after 2025, and state funding for the Demand Side Grid Support program beyond 2026 was in doubt.
Budgets and waitlists change. Confirm with your utility or the SGIP administrator before counting on an incentive.
Should you own the battery or pay for it under a contract?
If you buy, you keep all the savings and handle the warranty and upkeep yourself, with no federal credit in 2026. If a company owns the battery under a lease or PPA, it may claim the business credit and is usually responsible for maintenance. Whether a battery can be included depends on the provider and the contract.
For how the PPA side works, see solar PPAs for California homes; for whether solar still pays at all, see home solar in California in 2026.
What should you ask before adding a battery?
- What share of my evening use will it cover, based on my own hourly data?
- Which circuits will it back up, and for how long?
- How much charge is held in reserve, and can I raise it before a forecast shutoff?
- Who controls the battery, and can it be enrolled in a grid program without my consent?
- What do the warranty and the contract say about capacity loss over the years?
Will Aeternus include batteries in California?
We are arranging a home solar PPA in California, and our office there opens on December 1, 2026. Whether a battery can be part of it will depend on the provider we sign, and we will say so plainly when we can make an offer. The PPA is not available yet; if you would like us to contact you when it is, register your interest.
Questions
Can I add a battery to the solar system I already have?
Often, yes. The battery needs utility approval to connect, and the installer has to check that it works with your inverter. If you are on NEM 2.0, ask your utility how adding storage affects your current tariff before you sign.
How big should a home battery be?
Big enough for your evening use and the circuits you want backed up. For its low-income program the CPUC expects an average single-family home to install about 15 kWh, but your own hourly data is the better guide.
Does a battery work during a Public Safety Power Shutoff?
Yes, if it is installed with backup capability and has charge left. It powers the circuits it was set up to carry, and solar can recharge it in daylight if the system is designed to run while the grid is down.
Is there still a federal tax credit for home batteries?
Not for homeowners who buy one: the credit ended for batteries installed after December 31, 2025. A company that owns a battery on your property under a lease or PPA may still claim a business credit, subject to sourcing rules.
Sources
- CPUC: Net Energy Metering and Net Billing (net billing tariff, export credits, nine-year legacy, required time-of-use rates): https://www.cpuc.ca.gov/industries-and-topics/electrical-energy/demand-side-management/customer-generation/net-energy-metering-and-net-billing
- PG&E: Solar Billing Plan guide for residential customers (Electric Home rate, export credits, batteries): https://www.pge.com/assets/pge/localized/en/docs/clean-energy/solar/pge-solar-billing-plan-guide.pdf
- SCE: Solar technology FAQs (a grid-tied system does not provide power during outages without storage): https://www.sce.com/customer-service-center/help-center/solar/getting-started-with-solar/solar-technology-faqs
- CPUC: Public Safety Power Shutoffs: https://www.cpuc.ca.gov/psps
- CPUC Resolution E-5364 (adopted March 13, 2025): inputs and assumptions for bill savings estimates in the CSLB Solar Energy System Disclosure Document: https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M559/K800/559800004.PDF
- CPUC: Self-Generation Incentive Program (SGIP): https://www.cpuc.ca.gov/sgip
- PG&E: Self-Generation Incentive Program (rebate status for residential customers): https://www.pge.com/en/save-energy-and-money/rebates-and-incentives/self-generation-incentive-program.html
- SCE: Self-Generation Incentive Program (ratepayer budgets closed; equity budget on a waitlist): https://www.sce.com/clean-energy-efficiency/solar-generating-your-own-power/billing-incentives/self-generation-incentive
- SGIP San Diego (Center for Sustainable Energy): Residential Solar and Storage Equity funding reserved, waitlist: https://sgipsd.org/
- CPUC fact sheet: SGIP Residential Solar and Storage Equity incentives for low-income homes: https://cpuc.ca.gov/-/media/cpuc-website/divisions/energy-division/documents/self-generation-incentive-program/sgip-fact-sheet---residential-solar-and-storage-equity.pdf
- PG&E: Permanent Battery Storage Rebate (status October 30, 2026): https://www.pge.com/en/save-energy-and-money/rebates-and-incentives/permanent-battery-storage-rebate.html
- PG&E: Generator and Battery Rebate Program (open through December 31, 2026): https://www.pge.com/en/outages-and-safety/outage-preparedness-and-support/general-outage-resources/generator-and-battery-rebate-program.html
- CPUC: Emergency Load Reduction Program: https://www.cpuc.ca.gov/industries-and-topics/electrical-energy/electric-costs/demand-response-dr/emergency-load-reduction-program
- Utility Dive (May 20, 2026): Funding for California’s signature virtual power plant remains uncertain: https://www.utilitydive.com/news/funding-for-californias-signature-virtual-power-plant-remains-uncertain/820747/
- IRS Fact Sheet FS-2025-05: FAQs on the modification of sections 25C, 25D and other credits under Public Law 119-21: https://www.irs.gov/EnergyCreditFAQs
- pv magazine USA (July 10, 2025): What the budget bill means for energy storage tax credit eligibility: https://pv-magazine-usa.com/2025/07/10/what-the-budget-bill-means-for-energy-storage-tax-credit-eligibility/