What is Solar Energy? How Does it Work?

Solar energy is the energy that comes from the sun’s radiation and light, which can be captured and converted into usable electricity. Although sunlight reaching earth’s surface is relatively spread out, the sun provides an enormous amount of energy each day—far more than the world’s daily electricity needs. The two main technologies used to harness this energy are photovoltaic (PV) panels, also known as solar panels, and concentrated solar power (CSP).

As the most abundant energy resource on earth, solar power provides clean, renewable, and emission-free energy for homes, businesses, and communities.

How Community Solar Works

Community solar is a subscription service to a local, off-site solar array. You don't have to install or own solar panels on your home to participate. Each month, you receive bill credits and pay a subscription fee based on the amount of energy produced by your share of the solar project. For low-income participants, the bill credits will always be higher than the subscription fees, resulting in guaranteed savings of 10–15% a year on your electricity bill. The three program administrators are Community Energy Project (CEP), Energy Trust of Oregon (ETO), and Energy Solutions. For more information about how community solar projects work in the U.S., visit the U.S. Department of Energy's Community Solar page. The Oregon Community Solar Program website also explains the history of the program.

Eligibility for the Program

To participate, you must live in Oregon and be a customer of Portland General Electric (PGE), Pacific Power, or Idaho Power. Low-income households may qualify for additional bill credits. See the income guidelines table below: (Insert table here). 

Benefits of Community Solar

Community solar is an easy way to support clean, renewable energy while enjoying guaranteed savings on your electricity bill. By participating, you'll receive monthly bill credits without the upfront costs of installing solar panels on your home. It's a great option if you don't own your home, if your roof is consistently shaded by trees, or if your roof is older and not ideal for solar panels. Community solar gives you the opportunity to benefit from solar energy without needing to install or maintain your own system. Your subscription is also flexible. If you move and remain within the same utility service area, your subscription and bill credits can move with you. Plus, there are no late fees or contract termination fees, making community solar a simple and accessible way to participate in renewable energy.

FEDERAL

Solar For All

*In April 2024, Oregon was awarded $86.6 million through the program, but the funding was canceled by the EPA in August 2025. Oregon is currently involved in a lawsuit challenging the cancellation, so the future of the program and funding remains uncertain.*
Eligibility: The Oregon program was designed to serve more than 8,000 low-income households and support solar access for single-family homes, multifamily buildings, and community solar projects. The program was also intended to provide workforce development and other support for communities that have historically had less access to clean energy.
Amount: Oregon was awarded $86.6 million in federal funding through Solar for All.
How it Works:  The Oregon Solar for All Coalition, made up of the Oregon Department of Energy, Energy Trust of Oregon, and Bonneville Environmental Foundation, was developing programs to make solar more affordable and accessible to low-income households. However, on August 7, 2025, the EPA notified Oregon that it was canceling the Solar for All funding. Oregon challenged the decision and, in October 2025, joined 23 other Solar for All awardees in a lawsuit against the EPA. As of 2026, the litigation is ongoing, and the funding is not currently available to Oregon residents.
More Info: Solar for All - ODOE

Residential Clean Energy Credit

*The Residential Clean Energy Credit provided a 30% federal tax credit for qualifying clean energy improvements installed at a home between 2022 and December 31, 2025. The credit is no longer available for new property installed after December 31, 2025, following changes to federal law in 2025.*
Eligibility: The credit was available to homeowners and renters who installed qualifying clean energy property at a home in the United States. The home could be a main residence or, in some cases, a second home that the taxpayer lived in part-time. Landlords and property owners who did not live in the home were not eligible.
Amount: The credit was equal to 30% of the cost of qualifying clean energy property, including solar electric panels, solar water heaters, small wind turbines, geothermal heat pumps, fuel cells, and battery storage with a capacity of at least 3 kilowatt-hours. Certain labor, installation, wiring, and preparation costs could also qualify.
How it Works: The credit was claimed for the tax year in which the qualifying equipment was installed, rather than when it was purchased. Homeowners and renters claiming the credit would file Form 5695, Residential Energy Credits, with their federal tax return. The credit was nonrefundable, meaning it could not reduce federal tax liability below zero, but unused credit could generally be carried forward to a future tax year. For installations completed after December 31, 2025, the credit is no longer available.
More Info: Residential Clean Energy Credit - IRS

STATE

Oregon Solar + Storage Rebate Program

*As of June 2026, the program is not currently accepting new rebate reservation applications because the $1.1 million in funding made available for the latest round was fully reserved within minutes of reopening.*
Eligibility: Oregon homeowners can qualify for solar and energy storage rebates, with larger incentives available to low- and moderate-income households. Solar and storage systems must be installed on property in Oregon by an ODOE-approved contractor and meet the program's technical requirements. Low- and moderate-income homeowners can qualify by meeting income requirements. There are three pathways to confirm eligibility; look on ODOE’s site to see these options.
Amount: Homeowners can receive up to $5,000 for a solar electric system and up to $2,500 for an energy storage system. Low- and moderate-income homeowners can receive up to 60% of the net cost of the system, while other eligible homeowners can receive up to 40% of the net cost. Solar rebates for low- and moderate-income homeowners are calculated at $1.80 per watt, while storage rebates are calculated at $300 per kilowatt-hour, subject to program limits.
How it Works: Rebates are paid directly to an ODOE-approved contractor, who passes the full rebate amount on to the customer as an upfront reduction in the cost of the project. Customers do not have to pay the full cost and wait for a rebate check. Contractors must submit a rebate reservation request before construction or installation begins.
More Info: Oregon Solar + Storage Rebate Program (Homeowners) – ODOE

LOCAL

Energy Trust of Oregon (ETO) Solar Incentives

Eligibility: Homeowners served by Portland General Electric or Pacific Power may be eligible for solar incentives. Solar installations must meet Energy Trust's qualifying requirements and be installed by an Energy Trust trade ally contractor. Battery storage incentives are available for new solar-plus-storage systems or for batteries added to an existing qualifying solar system.
Amount: Portland General Electric (PGE): $3,500 per home for qualifying solar installations. Minimum solar size of 2 kW-DC. Pacific Power: $2,500 per home for qualifying solar installations. Minimum solar size of 2 kW-DC.
For battery storage:
Portland General Electric: $400 per kWh, up to $5,000 per home. Minimum battery size of 3 kWh.
Pacific Power: $288 per kWh, up to $3,600 per home. Minimum battery size of 3 kWh.
How it Works: Customers work with an Energy Trust trade ally contractor who can help determine whether their equipment and installation meet the program's requirements. For battery storage, the battery must be connected to a solar system that meets Energy Trust's qualifying standards. Incentive amounts are subject to funding availability and may change, so customers should check current program requirements before starting a project.
More Info: Solar Incentives for Your Home - Energy Trust of Oregon

Energy Trust of Oregon (ETO) Solar Within Reach Program

Eligibility: To qualify, you must be an Oregon customer of Portland General Electric or Pacific Power, meet Energy Trust’s income requirements for your household size and county, and work with an Energy Trust solar trade ally contractor that participates in Solar Within Reach. You must also own and live in an eligible home, which can include a single-family home, manufactured home, floating home, or certain attached multifamily homes such as a duplex, triplex, or fourplex.
Amount: Increased solar incentives include:
Portland General Electric: $1.25 per watt, up to $7,500 per home. Minimum solar size of 2 kW-DC.
Pacific Power: $0.85 per watt, up to $5,250 per home. Minimum solar size of 2 kW-DC.
For battery storage:
Portland General Electric: $500 per kWh, up to $6,250 per home. Minimum battery size of 3 kWh.
Pacific Power: $400 per kWh, up to $5,000 per home. Minimum battery size of 3 kWh.
How it Works: Solar Within Reach is an Energy Trust of Oregon program that provides increased solar and battery storage incentives to income-qualified households. Homeowners first confirm that they meet the income requirements and then work with an eligible Energy Trust solar trade ally contractor. Energy Trust can help connect interested homeowners with qualified contractors who can provide a free, no-risk analysis and project bid. The contractor will also help determine which equipment meets the program requirements. Incentives are subject to available funding and may change over time.
More Info: Solar Within Reach - Energy Trust of Oregon

Energy Trust of Oregon (ETO) Portland Solar Access Program

Eligibility: To qualify, you must live within Portland city limits, own and live in a single-family home, have a household income at or below 80% of the area median income, and be a customer of Portland General Electric or Pacific Power. Your home must also be suitable for solar and have enough sunlight to support an installation. Renters are not eligible for this program, although they may be able to participate through community solar.
How it Works: The Portland Solar Access Program helps income-qualified Portland homeowners install solar with no out-of-pocket cost. The program, funded by the City of Portland and the Portland Clean Energy Community Benefits Fund (PCEF), is expected to help approximately 1,000 income-qualified households access solar and may also help cover certain repairs needed to make a home ready for solar. Homeowners can apply through one of the program's community partners: APANO, Community Energy Project, or Self Enhancement, Inc. A program representative will help with the application and determine eligibility. If approved, the home will be evaluated to make sure it can safely accommodate solar. A pre-selected solar contractor from Energy Trust's trade ally network will then install the system at no cost to the homeowner. If eligible repairs are needed before the installation, the program may also be able to help cover those costs. The contractor will explain how the system works and provide an estimate of how much the homeowner could save on their electricity bills.
Amount: The program covers 100% of the cost of the solar system and installation for eligible homeowners, meaning there is no out-of-pocket cost to the homeowner. If eligible repairs, such as roof repairs, are needed before solar can be installed, the program may also be able to cover those costs up to program limits.
More Info: Portland Solar Access Program - Energy Trust of Oregon

Portland General Electric – Net Metering

Eligibility: Residential customers can apply for Net Metering for qualifying solar generation systems. For residential systems with a capacity of 25 kW or less, the application is free. PGE reviews each application to make sure the local electrical grid can safely and reliably support the system. Customers must receive approval before beginning construction and must obtain the required municipal or county electrical permit.
Amount: There is no fixed dollar rebate. Instead, you receive bill credits for excess electricity your solar system sends back to the PGE grid. Electricity generated by your panels is first used in your home, reducing the amount of electricity you need to buy from PGE. When your panels produce more electricity than your home is using, the extra electricity flows to the grid through your bidirectional meter. PGE tracks that excess generation and applies it as a credit toward your electricity use. These credits can accumulate and help offset electricity charges in future months. You will still be responsible for PGE's monthly basic service charge, which is typically around $11–$13.
How it Works: You or your solar contractor submit a Net Metering application through PGE's application system. PGE's technical team reviews the project to make sure the grid can safely handle the additional generation. Once the application is approved, you obtain the required local electrical permits and complete the necessary agreement with PGE. PGE then installs a bidirectional meter that measures both the electricity you use from the grid and the excess electricity your solar system sends back. If you have unused energy credits at the end of the annual billing cycle, PGE's current program rules provide for those credits to be donated to low-income bill assistance programs.
More Info: Net Metering - Portland General Electric

Pacific Power - Customer Generation

Eligibility: Must be a customer of Pacific Power. Customers who want to connect a privately owned generation system to the Pacific Power grid must submit an application and receive approval before connecting the system. Customers must work with a qualified installer, obtain the required permits, and have the completed system inspected before it can be turned on.
Amount: There is no fixed cash rebate through the Customer Generation program. Instead, customers with qualifying net metering systems can receive bill credits for excess electricity their system sends to the grid. If a system produces more electricity than the home is using, the extra electricity flows back to the grid and is recorded by the utility. Any excess generation credits can be used toward future electricity bills within the annual billing period. Customers will still receive a monthly bill because they are responsible for the basic monthly charge and any electricity they need to purchase from the grid.
How it Works: The application process starts by choosing an installer and submitting an online application to Pacific Power with information about the proposed system and a picture of the existing meter. Pacific Power reviews the application and must authorize the interconnection before installation can move forward. After approval, the customer obtains the necessary permits and has the system installed, but does not turn it on until the required inspection is completed. Pacific Power then installs the appropriate meter, typically within 7–10 days, and notifies the customer when the system can be turned on. Once the system is operating, the electricity it produces is used by the home first. If the home is using more electricity than the system is producing, the customer draws the remaining electricity from the Pacific Power grid and pays for that energy.
More Info: Customer Generation - Pacific Power

PUBLIC UTILITIES

Central Lincoln PUD: Rebates up to $2,000 for solar electric systems ($500/kW DC) and battery storage, with additional incentives for hydro and wind systems; Central Lincoln also offers community solar in the Lincoln County area; details here.
Central Electric Co-op: Offers community solar and net metering for members with solar, wind, fuel-cell, or hydroelectric generation, allowing members to offset their electricity use with power they generate; details here.
Forest Grove Light & Power: Offers solar incentives of up to $1,500 for homes with electric heat as the primary heat source, or up to $1,000 for homes with other primary heating sources; details here.
Umatilla Electric Co-op: Offers a solar rebate of $300 per rated kW, up to a maximum of $1,500; details here.
Salem Electric Co-op: Offers a $300 per kW solar incentive, up to $1,500, for qualifying net-metered systems; details here.
Eugene Water & Electric Board (EWEB): Offers residential solar incentives of $0.40 per AC output watt, up to $2,500. EWEB also provides net metering, allowing customers to receive credits for excess solar electricity sent back to the grid; the 2026 incentive budget is $125,000 and is available on a first-come, first-served basis, with 73% allocated as of July 20, 2026; details here.

FEDERAL

Investment Tax Credit for Commercial Solar Photovoltaics (ITC / Clean Electricity Investment Credit)

*The Trump administration's One Big Beautiful Bill Act (OBBBA) introduced significant changes to federal clean-energy tax credits, including strict construction and completion deadlines and new sourcing restrictions for commercial solar projects.*
*Started before July 4, 2026: Projects that began construction on or before July 4, 2026 can remain eligible for the credit under the applicable continuity rules, including a four-calendar-year safe harbor. A project beginning construction in 2026 could generally have until December 31, 2030 to be placed in service under that safe harbor.*
*Started after July 4, 2026: New commercial solar projects that begin construction after July 4, 2026 generally must be placed in service by December 31, 2027 to qualify for the Clean Electricity Investment Credit.*
Eligibility: Businesses and other taxpayers that install qualifying commercial solar photovoltaic (PV) systems in the United States.
Amount: A qualifying commercial solar project can receive a 30% federal tax credit when prevailing-wage and apprenticeship requirements are met. Without those requirements, the base credit is 6%. Additional bonus credits may be available for qualifying projects.
How it Works: The ITC is a federal tax credit that reduces the amount of federal income tax a business owes based on its qualifying solar investment. The credit is claimed through the federal tax system using the applicable IRS forms rather than being paid as an upfront rebate.
More Info: IRS Clean Energy Tax Incentives for Businesses, Energy Select - Understanding the Commercial Solar Tax Credit

STATE

Energy Trust of Oregon (ETO) Solar & Battery Incentives

Eligibility: You must be an Oregon customer of Portland General Electric or Pacific Power and work with an approved Energy Trust solar trade ally contractor to be eligible for incentives. Available to qualifying businesses, nonprofits, government entities, Tribal Nations, utility grant applicants, and new construction projects served by Portland General Electric (PGE) or Pacific Power. Incentives are also available for qualifying solar + storage projects.
Amount: Solar development assistance: Up to $2,000 from PGE or Pacific Power to help cover the cost of a solar feasibility report.
Battery storage development assistance: Up to $3,000 from PGE or Pacific Power to help cover the cost of a battery storage feasibility report.
Solar installation: $0.10/watt, up to $9,500 for PGE customers or $10,000 for Pacific Power customers.
Battery storage installation: $300/kWh, up to $9,000 for both PGE and Pacific Power customers.
How it Works: Start by requesting proposals from Energy Trust-approved solar trade ally contractors and compare two or more bids. Once you select a contractor, they will handle the required Energy Trust paperwork before installation. The contractor receives the Energy Trust cash incentive directly and deducts the incentive from your invoice, reducing your upfront installation cost. Development assistance can also help cover the cost of feasibility studies and system design. Incentives are subject to funding availability and may change, so confirm current offers with your contractor before starting a project.
More Info: Solar for your Business - Energy Trust of Oregon

Pacific Power Blue Sky Community Project Fund

Eligibility: Available for new renewable energy projects or additions to existing projects using new equipment that are connected to the grid and served by Pacific Power or Rocky Mountain Power. Projects must be non-residential, locally owned, and no larger than 10 MW. Projects must also include an approved Wattsmart Battery storage system and participate in the Wattsmart Battery program if available in the state, with the battery configured for self-consumption to meet the organization’s needs. Applicants must plan to engage with the local community and share educational facility data and agree to enroll as a Blue Sky Participant after project completion.
Amount: Funding varies based on the size and scope of the project. Applicants must generally contribute 20–50% of the total eligible project cost with their own funds.
How it Works: The Blue Sky Community Project Fund uses contributions from Pacific Power customers to help fund local renewable energy projects. Eligible organizations apply for funding, and selected projects receive grant support toward their renewable energy installation. Preference is given to projects that provide community resilience benefits, including facilities that serve as Community Resilience Hubs during emergencies.
More Info: Blue Sky Community Project Funding - Pacific Power

PGE Green Future Renewable Development Fund

Eligibility: Available for new non-residential renewable energy projects and connected energy storage that are directly connected to PGE’s grid or delivered to PGE through a Power Purchase Agreement (PPA). Eligible projects can include solar, wind, small hydropower, energy storage, renewable energy research and development, and educational components associated with an RDF-funded project.
Amount: Funding varies by project. The fund can support all or part of the costs of qualifying renewable energy and energy storage projects. Projects may also receive up to $7,500 in additional funding for educational components directly associated with an RDF-funded renewable energy project.
How it Works: The Green Future Renewable Development Fund is funded by voluntary contributions from PGE customers who participate in the Green Future Choice and Green Future Block programs. Organizations apply for funding for qualifying renewable energy projects, with preference given to projects that demonstrate strong community benefits and pursue other available funding sources, including incentives, grants, tax credits, and in-kind contributions. Since 1999, the program has awarded more than $21 million to over 120 projects and helped create more than 17 MW of clean energy.
More Info: Green Future Renewable Development Fund - PGE

PUBLIC UTILITIES

Eugene Water & Electric Board (EWEB): Offers nonprofits, government agencies, and other public entities a solar incentive of $0.50 per AC output watt, up to $12,500. EWEB also provides net metering, allowing these customers to receive credits for excess solar electricity sent back to the grid; the 2026 incentive budget is $125,000 and is available on a first-come, first-served basis, with 73% allocated as of July 20, 2026; details here.

City of Ashland Utility: Offers a $600 incentive for qualifying solar electric installations that pass the required electric inspection; systems also benefit from net metering, allowing excess solar generation to be credited toward future electricity use; details here.