Dive Brief:

• California’s Self-Generation Incentive Program reopened on Monday with the program’s first step, or phase, seeing to high demand with most of the allocations for energy storage applications being taken up.

• At the end of the first day there was only $3.7 million of allocations left for customers of Southern California Gas and the Los Angeles Department of Water and Power out of the total $42.7 million allocated for large energy storage projects.

• For small (<10 kW) storage projects, there were only $3.4 million for customers of Pacific Gas and Electric out of the total $7.5 million allocated.

• All four service territory segments of the generation portion of the program were still open after the first day, so they go into successive rounds, separated by a 24 hour hiatus, until the allocations are all used.

Dive Insight:

SGIP, one of California’s most successful renewable energy incentive programs, reopened with a bigger budget, a total of $567 million, and a new procedure intended to avoid the gaming that occurred when the program was on a first-come, first-served basis.

Applicants in the fully subscribed segments — three of the four utility service areas for both residential and large scale storage — automatically are put into a lottery that randomly picks the top applications. If a storage incentive segment is not fully-subscribed, applications are awarded in order of receipt. 

The lottery mechanism prioritizes solar-plus-storage facilities, as well as batteries sited in the Los Angeles Basin area affected by the Aliso Canyon natural gas leak.

Lottery winners for large storage projects will receive an incentive of $0.50/Wh, or $0.36/Wh if they elect to also take the investment tax credit. Lottery winners for residential storage projects receive an incentive of $0.50/Wh.

Generation incentives are $0.90/Wh for wind projects and $0.60/Wh for other forms of generation.

Funding allocations will go through up to five steps. When funding is exhausted for one step, a 20-day “pause period” is triggered until the next step opens with a lower incentive rate. 

If available funds for one step are allocated in less than ten days — as is the case with most regions in this step — the incentive drops down by $0.10/Wh in the next round. If funding is not depleted within ten days, the incentive for the next step falls by $0.05/Wh.

According to the SGIP website, Tesla is the clear leader in funding allocations for large-scale storage so far, with AMS coming in second.