How much would it cost to build a home solar power system? It depends. There are a lot of factors to consider. But one thing is for sure, it is going to be expensive. Many home owners shy away from home solar energy because of the large capital investment.

There is one way you for you to reduce your solar home improvement project cost. It is by making use of the government home solar power rebates. What are solar rebates?

In simple term, a rebate is the amount of money given back to a customer after he or she makes a purchase. For example, some manufacturers give out rebate for their products. You buy a solar system or component, and the manufacturer gives you either an instant rebate at the checkout or one that you need to mail in your purchase receipt.

A government solar power rebates is pretty much the same. How the rebates are being paid out?

Generally, the rebates are paid to the professional solar contractor when a work is done. As a home owner, you do not need to finance the entire solar power system and then wait to get the rebate back. This is, in effect, a secondary rebate because it allows solar users to more easily purchase a solar system.

But before you rush to buy a home solar energy system, there are a few things you have to know. Getting the government to pay you is not a simple process.

To get your home solar energy rebates, the procedure involves tones of detailed paper work generally incomprehensible to the average lay person.

Let’s use the state of California as an example. California has its own state solar incentive program known as The California Solar Initiative (CSI).

The CSI is part of the Go Solar California campaign that offers solar rebates to customers of utility territories such as Pacific Gas & Electric (PG&E), Southern California Edison (SCE), and San Diego Gas & Electric (SDG&E.) The California Solar Initiative is overseen by the California Public Utilities Commission.

Here’s a quick run through how the rebates are calculated. California Solar Initiative rebates vary according to system size, customer class, and performance and installation factors.

There are two types of rebate paths you can choose:

1) Expected Performance Based Buydown (EPBB)

If your home has installed a solar system with less than 50 kilowatt (kW) power output, you may apply for an up-front cash rebate known as the Expected Performance Based Buydown (EPBB).

2) Performance Based Incentive (PBI)

If your home uses a solar system that has an output between 50 kW and 1 MW, you can apply for the Performance Based Incentive (PBI) structure.

PBI incentives are a five-year stream of fixed monthly payments determined by the actual output of the system, as metered and reported to the utility.

The whole scenario of getting your home solar power rebates is complicated nonetheless. It would not be a good idea trying to get it done by yourself. It is best to engage a solar contractor or solar professional.

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