San Francisco Department of the Environment

Financial Incentives for Solar Water Heating

California Solar Initiative-Thermal (CSI-Thermal)

The CSI-Thermal program has a goal to install 585 million therms of gas-displacing solar hot water systems by the end of 2017 and provides an up-front rebate for installing a solar water heater, based on system size and performance. Residential customers can receive an incentive of up to $2,719 for solar water heating systems that reduce natural gas use, and $1,834 for systems that reduce electricity and propane use. Businesses and commercial property owners can receive an incentive of up to $500,000 for natural gas displacing systems and $250,000 for electricity displacing systems. For more information, visit

Federal Tax Credits and Accelerated Depreciation

A 30 percent federal tax credit is offered for the installation of both residential and corporate solar energy systems. The tax credit is applied to the net cost after other rebates or grants have reduced the initial system cost. The current federal tax credit program is available through 2016.


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