Benefits of battery storage

Environmental impacts

By shifting your excess solar generation to peak periods, you're reducing your carbon emissions and the demand on the electric grid, putting us closer to our goal of reaching zero carbon emissions in our power supply by 2030 – the most ambitious goal of any large utility in the United States.

Bill saving

A battery storage system lets you store excess solar energy generated during the day. You can use this excess energy during peak hours, when electricity is most expensive. This reduces the typical customer’s electric bill, but doesn't factor in the cost of leasing or purchasing the battery. Learn more about our Time-of-Day rate.

Backup power

In the event of a power outage, battery storage systems can provide power and reliability. Unlike backup generators, battery storage can power critical appliances like your refrigerator.

Start your estimate

Check if battery storage is right for you. Log in to My Account to use our solar system estimator and let us advise you.

See if you'll save

Enroll for incentives

Ready to take the next step? Learn about our My Energy Optimizer® program and the incentives you can earn from a battery storage system.

Get incentives

Battery storage incentives

Take advantage of our battery storage incentive available for residential customers.

Join SMUD’s voluntary program, My Energy Optimizer®, and earn financial incentives for making your battery storage unit an even smarter device.

  • When you partner with SMUD, your battery will reduce energy usage during the hours when demand is highest and clean energy resources are scarce. This could include shifting the time when your battery is used to power your home. The interactions would be seamless to you and no extra effort is needed on your part.
  • To be eligible for the program, you must have a battery storage unit installed at your home and participate in SMUD’s Solar and Storage Rate.
  • If you’re adding a new solar system with battery storage or a battery storage system only, there's a one-time interconnection fee to connect to SMUD’s grid to recover the cost of providing interconnection service. Your solar installer should already be aware of this fee. If you're adding battery storage to an existing solar system, an interconnection fee does not apply.

My Energy Optimizer Partner+ ($10,000 incentive, up to 2 batteries)

My Energy Optimizer Partner+ includes a one-time incentive of up to $5,000 for each battery (2 maximum). You'll be paid after the interconnect application reaches a project complete status and enrollment onboarding process is completed plus, has ongoing performance payments. 

My Energy Optimizer Partner+ optimizes your battery year-round. The battery will continue to be available for customer use, such as back-up power needs in the event of an outage.

  • Customers will receive ongoing performance payments (see recurring incentive below) in addition to the enrollment incentive.
  • Once enrolled, you don't need to reconfigure your battery storage system.
  • To receive this incentive, you must have a Tesla Powerwall.
  • Check back for additional battery manufacturers coming soon!

Incentive amounts

The following incentives amounts are for battery interconnections submitted on or after April 1, 2024. View the incentives for interconnections submitted before April 1, 2024.

Powerwall 2 and Powerwall+

Battery quantity Enrollment incentive
(Paid one time)
Ongoing incentive
(Paid quarterly)
 3-Year program value
1 battery $5,000 $102  $6,224
2 batteries $10,000 $205  $12,460
3 batteries $10,000 $307  $13,684


Powerwall 3

Battery quantity Enrollment incentive
(Paid one time)
Ongoing incentive
(Paid quarterly)
3-Year Program Value
1 battery $5,000  $110 $6,327
2 batteries $10,000  $221 $12,654
3 batteries $10,000  $332 $13,981


Powerwall 3 with DC Expansion

Battery quantity Enrollment incentive
(Paid one time)
Ongoing incentive
(Paid quarterly)
3-Year Program Value
3 batteries $10,000  $235 $12,826


For more information on the program and incentives, view the terms and conditions

Enroll today

Frequently asked questions

How does a battery storage system operate?
Battery storage systems are a way of storing and releasing electrical energy in a chemical manner. Battery storage systems store the energy in batteries. An inverter converts the battery's DC energy to AC energy your home can use.

The battery is charged using energy from your solar PV system or the electric grid. The battery is discharged to offset energy use during more expensive peak times of the day. This is to reduce your electric bill or for back-up power in the event of an outage.

What is the lifespan of a battery storage system?
Lithium Ion (Li-Ion) battery systems usually last about 10 years. The warranty period for batteries is set by your battery system manufacturer.

Do all battery storage systems provide backup power?
Many battery storage systems can provide backup power if they are configured to do so. A battery can be configured to provide backup power for critical items or your whole home. Be sure to communicate with your contractor about how much, if any, of your battery capacity you want dedicated to backup power.

Is battery storage safe?
Safe installation should follow:

  • National Electric Code (NEC)
  • SMUD’s Electrical Service Requirements
  • Any additional requirements of your local building permitting agency

Follow manufacturer’s care, use and service criteria to ensure safest possible operation.  

How long will a battery storage system power my home during an outage?
Without solar, batteries usually provide backup power for about 2-3 hours at their peak rated output. When paired with solar generation, the backup period can be extended. The number of appliances powered during an outage will impact the backup power duration. 

What size battery system should I consider for my home?
Your battery installation contractor can help you decide what battery system size is right for you. The typical residential battery storage system installed in SMUD territory is a 5kW / 10kWh unit.

Can I go completely off-grid with a battery storage system?
While it is possible to go completely off-grid with a battery storage system, a modern home is not designed to be disconnected from the grid. A battery storage system is not a generator. It's not realistic to permanently operate off-grid without substantial investment in larger solar and storage systems. Even with solar generation, a storage system would need to be significantly larger to provide enough electricity to power your home 24 hours a day, 7 days a week.

How can I learn more about battery storage systems?
If you're interested in learning more about battery storage systems, you can attend a SMUD class to get a better grasp of this new technology. Also, we recommend getting multiple bids before you sign a contract.

Does SMUD have any requirements on how I install my battery?
SMUD requires that the battery storage system installation follows:

  • National Electric Code (NEC)
  • Requirements of your local building permitting agency
  • SMUD’s Electrical Service Requirements for Distributed Generation

The interconnection process for battery storage is very similar to interconnection of solar PV systems. Battery storage systems are processed through the SMUD PowerClerk portal. This step-by-step web tool will make your interconnection process easy and straight forward. Your contractor will most likely handle the process for you.

Am I eligible for the program if I'm currently in the process of installing a battery storage system at my home?
To be eligible for My Energy Optimizer Partner+, you must own a Tesla Powerwall installed at your home and participate in SMUD’s Solar and Storage Rate (SSR). To confirm your enrollment in the program, email

What about back-up power?
Program participants will have full access to the amount of power available in their battery storage system during a power outage. If a customer has 80% of their battery charged, then 80% capacity will be available to back-up the home.

Do battery storage system installations qualify for other incentives?
Battery systems charged by renewable resources may be eligible for:

  • State and federal incentives
  • Tax credits (Federal Investment Tax Credit and California Self Generation Incentive Program)

Check with your contractor and tax advisor for more details.

Are multi-family homes eligible for the program?
Multi-family homes (including apartments, condos and duplexes) are eligible for the program; however, please note restrictions about tenants below.

I own the home, but someone else pays the SMUD bill (like an apartment, condo or duplex). Can I sign up for My Energy Optimizer Partner+?
Individual rental units are ineligible at this time until SMUD determines a way for owners and their tenants to mutually benefit from the program.

Can I add a battery storage system on an existing solar installation?
Yes, you can add battery storage to existing solar installations. Your battery installation contractor will determine what's necessary to complete a retrofit installation.

Will I be charged an interconnection fee to add battery storage to my existing solar system?
No. You will not be charged an interconnection fee to add battery storage to your existing solar system.

How can I calculate the size of the solar electricity system I would need?
The size of your system should be based upon your electricity usage patterns, not the size of your roof. There are many variables that determine your system’s production, for example slope, orientation and shading. SMUD will allow your system to be sized up to 110% of the last 12-month kWh consumption or up to 120% for customers on the Solar and Storage Rate (SSR) if battery storage is added at the premises. For more information, contact the solar interconnection team

Can I increase the size of my solar electricity system?
For customers on the Solar and Storage Rate (SSR), SMUD will allow your system to be sized up to 110% of the last 12-month kWh consumption or up to 120% if battery storage is added on the premises. For existing NEM1 legacy customers, if the system size is increased by more than 10% of generating capacity originally approved, or 1 kW, whichever is greater, or exceeds 110% of generating capacity originally approved, you must move to the SSR rate schedule and submit a new Interconnection application.