How performance based incentives actually pay out
Paid over time, not upfront
Unlike a rebate or tax credit, a performance based incentive doesn't show up as one lump sum. Payments arrive monthly or quarterly based on metered production, typically running anywhere from 5 to 20 years depending on the program. That makes the total payout meaningfully harder to estimate at a glance, which is the whole reason this calculator exists. The DSIRE database of state incentives lists the incentives that apply in your state, with links to each program's rules.
Rates vary widely by program
Massachusetts's SMART program pays a base residential rate around 3 to 4.3 cents per kWh, while other state and utility programs range from about 2 to 10 cents per kWh. There's no single national rate, and rates for new enrollees sometimes step down over time as a program matures. Always confirm the current published rate for your specific program rather than assuming last year's figure still applies. Check the rebates and incentives hub for your state's current program details.
Why degradation matters more than people expect
Solar panels lose a small amount of output capacity every year, commonly cited around 0.5% annually for modern equipment under standard manufacturer warranties. On a 20-year program term, that steady decline meaningfully reduces your total payout compared to assuming flat production the whole time, which is why this calculator applies it year by year rather than using a single flat multiplier. If your state also runs an SREC market, the SREC value estimator handles that separate credit-based structure.
Eligibility depends on your ownership structure
Some performance based incentive programs are open to any system owner, while others are built specifically for third-party-owned systems under a lease or PPA. Check your program's rules directly, and use the federal ITC calculator to see how your ownership choice affects your federal credit eligibility as well.
With your rebate total in hand, the combined loan and rebate timing tool shows the monthly payment on the amount you still need to borrow. If you may qualify for low-income solar programs beyond what's covered here, the community solar for low-income households tool is worth checking too.