Last updated: October 23, 2026 · Reviewed by Jason Hamilton, Owner, Earthwise Energy Solutions (CSLB C-10 #1028255)
The short answer: The 30% federal tax credit for homeowners who buy solar or batteries ended for systems installed after December 31, 2025. Solar and storage can still qualify for the federal 48E business tax credit through a Prepaid PPA or Energy Services Agreement, where the company that owns the system claims the credit and passes part of the value to you. California’s solar property-tax exclusion applies only to systems completed before January 1, 2027. The core reason to go solar — lower PG&E bills and backup power — hasn’t changed.
What changed in 2026
The Federal Residential Tax Credit is gone. The Federal Residential Tax Credit (Section 25D, officially the Residential Clean Energy Credit) covered 30% of the cost of solar and batteries a homeowner bought. Under the federal law passed in July 2025, no credit is allowed for expenditures made after December 31, 2025. The IRS treats the expense as made when installation is completed, so paying a deposit in 2025 doesn’t help if the system was finished in 2026.
The 48E business tax credit still applies, for now. The federal business tax credit (Section 48E) applies when a business owns the system. For homeowners, that means 48E through a Prepaid PPA or Energy Services Agreement: a financing partner owns the system on your home for the first several years and passes part of the credit’s value to you. For solar, projects that begin construction after July 4, 2026 must be in service by December 31, 2027. Battery storage under this credit has a longer runway, with full value for projects beginning construction through 2033.
Incentives available to Bay Area homeowners now
| Incentive | Who it helps | Status | Deadline |
|---|---|---|---|
| Federal Residential Tax Credit (25D) | Homeowners who buy | Ended | Installs completed after Dec 31, 2025 don’t qualify |
| 48E business tax credit through a Prepaid PPA or Energy Services Agreement | Homeowners who choose a Prepaid PPA or Energy Services Agreement | Available | Solar: in service by Dec 31, 2027 if construction began after July 4, 2026. Storage: longer |
| California solar property-tax exclusion (R&TC §73) | Owners whose home value would otherwise rise | Ending | System must be completed before Jan 1, 2027 |
| SGIP battery rebates | Mainly income-qualified, medical-baseline, and high-fire-risk customers | Varies by budget | Check current funding |
| Net Billing Tariff (NEM 3.0) | All new PG&E solar customers | Active | — |
How Earthwise is pricing solar and batteries for 2026–2027
Earthwise offers three ways to go solar in 2026–2027. Our two prepaid options pass federal credit value through to you as a discount of up to 35% off our standard cash price, depending on your address and equipment.
| Cash purchase | Prepaid Energy Services Agreement — Propel (Concert Finance) | Prepaid PPA — Maxwell Capital (formerly HDM) | |
|---|---|---|---|
| Who owns the system | You, from installation day | The provider for the first 5 contract years; you take ownership after year 5 through the built-in Early Buyout Option | Maxwell for the first 6 years; then you can buy the system at fair market value, with your unused prepayment credited toward the price |
| Discount off standard cash price | None — our 2026 price per watt is lower than 2025 for the same system | Up to 35% | 20–30% |
| How you pay | Cash or your own financing | Prepay in full, or finance with a Medallion Bank loan through Concert Finance (no prepayment penalty) | Prepay in full |
| Equipment | Full selection | Domestic-content (American-made) equipment only; fewer battery choices | Wider choice of solar and battery brands; batteries go under a separate prepaid storage agreement |
| Service during provider ownership | Earthwise warranty | Earthwise, paid by the provider. Includes 5 years of maintenance and an 85% production guarantee | Earthwise, paid by Maxwell. Includes maintenance and an 85% production guarantee through year 6 |
| Federal tax credit | None | 48E business tax credit, claimed by the provider and passed through as your discount | 48E business tax credit, claimed by Maxwell and passed through as your discount |
Why the discount varies: the federal credit is larger for systems that use qualifying American-made (domestic-content) equipment and for homes in federally designated “energy communities,” which are set by location. The largest discounts go to homes that qualify on both. Your exact discount is set by your address and the equipment in your design.
Which is right for you? Cash gives you the widest equipment choice and immediate ownership. The prepaid options cost less upfront: with Propel you take ownership after year 5, and with Maxwell you can buy the system after year 6 with your unused prepayment credited. We’ll price your home all three ways side by side.
Pricing and savings vary by home, usage, and equipment. Consult your tax advisor.
The California property-tax exclusion ends this year
Under current law, a new solar system doesn’t increase your home’s assessed value if it’s completed before January 1, 2027. A 2025 law (SB 710) lets qualifying systems keep that treatment until the home is sold. A bill to extend the exclusion through 2030 was held in committee in May 2026. With roughly ten weeks left, only projects already permitted and scheduled are likely to finish in time. For this purpose, counties treat a system as completed at final building inspection — utility permission to operate isn’t required. Consult your tax advisor.
Why batteries matter more under NEM 3.0
Since April 2023, new PG&E solar customers are on the Net Billing Tariff. Exported solar earns far less than the retail price you pay for evening power. A battery stores midday solar and uses it during peak evening hours, when rates are highest. It also keeps essential loads running during outages and PSPS shutoffs.
Is solar still worth it without the 30% credit?
Absolutely. Your cash-flow payback will vary depending on your usage, roof, and how you finance. PG&E rates have risen substantially in recent years, and if that trend continues, the case only gets stronger. Solar plus storage reduces how much of that power you buy. We model each home individually using your actual PG&E usage data rather than averages.
Frequently asked questions
Can I still get the 30% solar tax credit in 2026?
Not if you buy the system yourself. The Federal Residential Tax Credit (25D) ended for installs completed after December 31, 2025. You can still benefit from the 48E business tax credit through a Prepaid PPA or Energy Services Agreement.
I paid a deposit in 2025. Do I still get the credit?
No. The IRS treats the expense as made when installation is completed, not when you pay.
Is there still a tax credit for home batteries?
Not if you buy the battery yourself. Batteries do qualify for the 48E business tax credit through a Prepaid PPA or Energy Services Agreement (ESA), and the battery credit runs longer than solar’s: full value for projects that begin construction through 2033.
Will solar raise my property taxes in 2027?
Systems completed before January 1, 2027 are excluded from reassessment. For systems completed later, the county assessor may add value. Consult your tax advisor.
Does Earthwise offer prepaid options?
Yes. We offer a prepaid energy services agreement through Propel (Concert Finance) and a prepaid PPA through Maxwell Capital. Both pass federal credit value through to you as an upfront discount. With Propel you take ownership after year 5; with Maxwell you can buy the system after year 6, with your unused prepayment credited toward the price.
Who services my system before I own it?
Earthwise does. The provider pays us to maintain and service your system during its ownership period, so you keep working with the same local team.
What if I sell my home before ownership transfers?
With Propel, you can transfer the agreement to your buyer, who takes over the scheduled buyout, or buy the system outright before closing. A $250 administrative fee applies either way. With Maxwell, a sale before year 6 means your buyer takes over the agreement, also for a $250 fee. After year 6, you can buy the system as part of the sale.
Talk with Earthwise
Earthwise Energy Solutions is a family-owned, CSLB-licensed (C-10 #1028255) solar and battery installer based in San Anselmo, serving Marin County and the Bay Area since 2010. Book a 2026–2027 options review, and we’ll show you the upfront and monthly numbers for your home side by side.
Talk with Earthwise to review my options
This page is general information, not tax or legal advice. Incentive rules change; consult your tax advisor about your situation.
