Self-Generation Incentive Program - California

The Self Generation Incentive Program (SGIP) - with 544 completed projects for a total capacity of 252 megawatts - is one of the longest-running and most successful distributed generation incentive programs in the country. In 2011 alone, these facilities provided over 760,000 MWh of electricity to the California, enough electricity to meet the needs of over 116,000 homes. The program continues to make strides towards a cleaner, distributed-energy future.

The SGIP was initially conceived of as a peak-load reduction program in response to the energy crisis of 2001. Assembly Bill 970 (Ducheny, 2000) designed the Program as a complement to the California Energy Commissions’ Emerging Renewables Program, which focused on smaller systems than the SGIP. Since 2001, the SGIP has evolved significantly. It no longer supports solar photovoltaic technologies, which were moved under the purview of the California Solar Initiative after its launch in 2006. It has also been modified to include energy storage technologies, to support larger projects, and to provide an additional 20% bonus for California-supplied products.

Senate Bill 412 (Kehoe, 2009) modified the focus on the Program to include greenhouse gas reductions. Specifically, this bill directed the Commission, in consultation with the Air Resources Board, to identify distributed energy resources which will contribute to greenhouse gas reduction goals and to set appropriate incentive levels to encourage their adoption. The Commission took this opportunity to expand the portfolio of eligible technologies, modify the incentive approach, and to enact other operational requirements including warrantees and performance monitoring to ensure greenhouse gas reductions.

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