This link specifically states that an energy conservation subsidy is not taxable:
U.S.C. Title 26 - INTERNAL REVENUE CODE
"
(a) Exclusion
Gross income shall not include the value of any subsidy provided (directly or indirectly) by a public utility to a customer for the purchase or installation of any energy conservation measure."
But it also says you can't double dip:
"
(b) Denial of double benefit
Notwithstanding any other provision of this subtitle, no deduction or credit shall be allowed for, or by reason of, any expenditure to the extent of the amount excluded under subsection (a) for any subsidy which was provided with respect to such expenditure. The adjusted basis of any property shall be reduced by the amount excluded under subsection (a) which was provided with respect to such property."
So you'd need to exclude it from your ITC or claim your incentive as income. Some people have said they'd be better off taking the higher rate of the ITC and them claiming the SGIP incentive as income but that seems a little shady to me since the link above specifically says it isn't income.
PG&E told me it depends on whether or not the SGIP application was filled out as tax exempt for getting a 1099 and Tesla told me they submitted the application as tax exempt.