California low income solar discount funding change moves the 20% credit onto a charge on every electric bill, effective ahead of a law taking effect July 1, 2026

The California Public Utilities Commission has already ordered Pacific Gas and Electric, San Diego Gas and Electric and Southern California Edison to fund the Disadvantaged Communities Green Tariff discount from a charge already on every electric bill, ahead of a law that ends the pollution allowance option July 1, 2026. The discount itself stays at 20% alone and up to 50% when combined with other bill assistance.

31California utilities the regulator has ordered to fund the low income solar discount from a charge already on every electric bill
204percent discount income qualified subscribers already receive on the power from these programs, unchanged by this shift
504percent discount some subscribers can reach when that credit combines with other bill assistance such as CARE or FERA

California low income solar discount funding change explained

California low income solar discount funding change means money, not the discount itself, is moving to a new place. The Disadvantaged Communities Green Tariff lets an income qualified household buy into a shared solar project it does not own and receive a discount on the power that project produces, run through the electric utility that serves the household or through a local community choice aggregator. Utilities have paid for that discount first with money the state collects by selling pollution permits under its cap and invest program, then with a charge added to every customer electric bill, called the public purpose program surcharge, once the pollution money ran out. The California Public Utilities Commission, in D.26-06-006, issued June 17, 2026, has now ordered Pacific Gas and Electric Company, San Diego Gas and Electric Company and Southern California Edison Company to fund the discount entirely from that bill surcharge going forward.

What the discount is worth today

The discount amount is not changing. Income qualified subscribers on the Disadvantaged Communities Green Tariff and the related Community Solar Green Tariff already receive a 20% discount on their share of the power, and some reach up to 50% off when that credit combines with other bill assistance such as CARE or FERA. California average retail price of electricity was 27.04 cents per kilowatt hour in 2024, the second highest of any state, so a 20% discount cuts a real cost, not a token one. A subscriber already enrolled sees no change in the size of the credit, only in which pot of money the utility draws it from.

How the discount lowers the price of a kilowatt hourNo discountWith the discount
010203027.04Nodiscount21.63With the20% discount13.52Stacked withCARE or FERAcents per kilowatt hour

MAOWCE calculates these 3 figures by applying the 20% discount and the up to 50% stacked discount source 4 states to the 27.04 cents per kilowatt hour average California retail electricity price for 2024, source 5. The 13.52 figure is a ceiling. Source 4 states some subscribers reach up to half off when the credit combines with other bill assistance such as CARE or FERA, not every subscriber reaches it.

Source 5.

Show the numbers
No discount27.04
With the 20% discount21.63
Stacked with CARE or FERA13.52

Why the money is moving

Assembly Bill 1207, chaptered September 19, 2025, extends the state cap and invest program through 2045 and ends, starting July 1, 2026, the option that let the Commission spend up to 15% of pollution allowance revenue on clean energy and efficiency projects. The bill text itself never mentions the Disadvantaged Communities Green Tariff or any Green Tariff by name, it only amends Public Utilities Code Section 748.5 in general terms. The Commission decision, not the bill text, applies that statutory change to this specific program, ordering the funding switch weeks before the law provision actually goes inoperative. Each utility must file an updated tariff within 30 days of the June 17, 2026 decision, a deadline MAOWCE calculates falls on July 17, 2026.

How the funding switch timeline unfolds
Assembly Bill 1207 signed into law0Commission decision orders the funding switch271Pollution allowance funding option becomes inoperative285Utilities must file updated discount tariffs301080160240320days after the law was signed

MAOWCE calculates each day count from the date Assembly Bill 1207 was chaptered, September 19, 2025, source 3. The Commission issued D.26-06-006 June 17, 2026, source 1, weeks before the law ends the pollution allowance option July 1, 2026, source 2. The utility filing deadline shown here is a calculation MAOWCE makes, 30 days after the decision issue date, since no source states it directly.

Source 1.

Show the numbers
Assembly Bill 1207 signed into law0
Commission decision orders the funding switch271
Pollution allowance funding option becomes inoperative285
Utilities must file updated discount tariffs301

What is not changing

The Community Solar Green Tariff, the related program serving the same households, keeps its existing funding from the bill surcharge and is not affected by this shift. Community choice aggregators that already run approved versions of the discount, including CleanPowerSF, Marin Clean Energy, Peninsula Clean Energy and San Jose Clean Energy, continue unaffected, and a new aggregator seeking to start its own version now files a simpler Tier 2 request instead of a Tier 3 one. Nothing here changes the state and federal grant money used for the separate, newer Community Renewable Energy Program that D.26-06-006 also created. For a household already receiving the Disadvantaged Communities Green Tariff or Community Solar Green Tariff discount, the bill credit stays exactly as it is, only the state accounting behind it moves from a pollution program to a charge already on every bill.

Sources

  1. Decision Implementing California Shared Renewables Portfolio, Decision 26-06-006, in Application 22-05-022 and related matters. California Public Utilities Commission. Published 2026-06-17. Accessed 2026-09-21.
  2. California Public Utilities Code Section 748.5, as amended by Assembly Bill 1207, Statutes of 2025, Chapter 117, Section 13. California Legislative Information, Office of Legislative Counsel. Published 2025-09-19. Accessed 2026-09-21.
  3. Bill status and text, AB 1207, Climate change, market based compliance mechanism, extension. California State Legislature, author Assembly Member Irwin. Published 2025-09-19. Accessed 2026-09-21.
  4. CPUC Community Solar Programs Prove Success Across California. California Public Utilities Commission. Published 2026-04-23. Accessed 2026-09-21.
  5. California, electricity profile. United States Energy Information Administration. Published 2025-11-10. Accessed 2026-09-21.

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