UnbiasedSolar
Typical home: Worth it

Is solar worth it in California?

For a typical California home in 2026, solar is worth it: about a 10.9-year payback and $21,593 saved over 25 years after paying for the system. Check your own home, because roofs, usage and utilities vary a lot.

Payback, typical home
10.9 yrs3 kW, paying cash
Electricity price
33.0¢per kWh, U.S. 18.0¢
Solar production
1,658kWh per kW per year
Exports credited at
~12%Net billing (reduced export credit)

The numbers for a typical California home

Electricity use469 kWh a month (California average)
Best-value system3 kW, producing 4,975 kWh a year (88% of use)
Price$10,700 at about $2.90/W
First-year savings$894
Payback10.9 years
25-year net$21,593 (9.2% a year return)
Rate increase assumed4.0% a year, from California's 2015–2025 history

Paying cash, no federal credit, 5% discount rate, microinverters, $25 per kW a year for maintenance and repairs. Methodology.

Why it comes out this way

  • Electricity is expensive: 33.0¢ per kWh over the last 12 months, 83% above the U.S. average (18.0¢).
  • Exported solar is typically credited at about 12% of retail, so systems pay best when sized for what you use yourself.
  • A typical system here produces about 1,658 kWh per kW per year (ranked #4 of 51).
  • There is no federal tax credit for homeowners who buy in 2026, which adds several years to payback compared with 2025.
Watch out for leases right now. Lease and PPA providers can still claim a federal credit that homeowners can't, so they're being pushed hard. Compare any lease against buying with our lease vs. buy calculator.

Net metering and export rules in California

Net billing (reduced export credit). New customers of PG&E, SCE and SDG&E are on the Net Billing Tariff (often called NEM 3.0): solar you use at home saves the full retail rate, but power you send to the grid is credited at hourly 'avoided cost' values that average only about 4-5 cents/kWh (higher on summer evenings). Batteries greatly improve the economics. Municipal utilities like LADWP and SMUD set their own rules.

Exports valued hourly using the CPUC Avoided Cost Calculator (ACC), varying by month/hour and locked for 9 years for the customer's vintage; early tranches also receive an 'ACC Plus' adder. 2024 ACC averages for 2025/2026 applicants: PG&E ~3.9, SCE ~4.6, SDG&E ~3.7 cents/kWh (adders ~1 cent PG&E, ~2 cents SCE for 2026 applicants).

  • Netting: instantaneous
  • Unused credits: Dollar export credits roll forward month to month; annual true-up after 12 months. Remaining credit at true-up is cashed out at Net Surplus Compensation rate (wholesale, a few cents/kWh) only for net kWh surplus.
  • System size limit: 1000 kW
  • Fixed charges: Income-graduated Base Services Charge on all IOU residential bills (~$24.15/month standard, ~$12 FERA, ~$6 CARE), implemented late 2025 (SCE, SDG&E) and March 2026 (PG&E), with lower per-kWh rates. NBT customers must take an electrification TOU rate (e.g., PG&E E-ELEC, SCE TOU-D-PRIME, SDG&E EV-TOU-5). Legacy NEM 2.0 customers pay non-bypassable charges on imports.
  • Last major change: Net Billing Tariff (CPUC D.22-12-056) effective Apr 15, 2023. Court of Appeal upheld NBT on remand March 2026; CA Supreme Court denied review June 10, 2026. Base Services Charge 2025-2026.
  • Pending: AB 942 (2025) amended to preserve legacy NEM on home sale; final status not confirmed. CPUC ACC updates (biennial) change export values for new vintages.

Read net metering explained to see why export rules can swing payback by years.

Rules by utility
UtilityExport creditNotes
Pacific Gas & Electric3.9¢/kWhNBT; avg ACC export ~3.9 cents plus ~1 cent ACC Plus adder for 2026 applicants. Summer 6-9 pm exports can be worth 20+ cents. Mandatory TOU (E-ELEC).
Southern California Edison4.6¢/kWhNBT; avg ~4.6 cents plus ~2 cent adder for 2026 applicants. Mandatory TOU.
San Diego Gas & Electric3.7¢/kWhNBT; avg ~3.7 cents, no adder for 2026 applicants. Highest retail rates in the state.
Los Angeles Dept. of Water & Power~100% of retailMunicipal; still offers traditional NEM with ~1:1 retail credits and 12-month true-up (not CPUC-regulated). Verify current LADWP tariff; changes have been discussed.
Sacramento Municipal Utility District9.6¢/kWhSolar and Storage Rate: export credit raised to 9.6 cents/kWh effective June 1, 2026; credits offset usage charges and carry forward. Mandatory TOU.

Solar incentives in California

The federal 30% Residential Clean Energy Credit ended for systems installed after December 31, 2025. What that means.

ProgramTypeWhat you getStatus
Self-Generation Incentive Program (SGIP) - Residential Solar and Storage Equitybattery incentiveRebates for battery storage (~$1,100/kWh) and paired solar (~$3,100/kW) for income-qualified/vulnerable households in IOU territories; single-family typically up to 15 kWh battery + 5 kW solar. General-market residential storage budgets largely exhausted. Eligibility: Low-income / medical-baseline / high-fire-threat or disadvantaged-community residents of PG&E, SCE, SDG&E, SoCalGas territories.waitlist
Disadvantaged Communities - Single-family Affordable Solar Homes (DAC-SASH)low incomeNo-cost solar (and sometimes storage) for income-qualified homeowners in disadvantaged communities, administered by GRID Alternatives. Eligibility: Low-income homeowners in CalEnviroScreen disadvantaged communities in IOU territories.active
Active solar energy system property tax exclusionproperty tax exemptionAdding a qualifying solar system does not trigger property tax reassessment (Rev. & Tax Code 73); currently scheduled through Jan 1, 2027. Eligibility: Systems installed before the sunset date.active

What solar costs in California

A fair cash price is around $2.90 per watt before incentives. For the 3 kW system that fits a typical home, expect roughly $7,400 to $10,400; smaller systems cost more per watt.

Public installation records (LBNL Tracking the Sun and state data, 217,063 owned systems since 2024) show a median of $4.51/W, with the middle half between $3.24 and $5.92. These prices include loan dealer fees, which is why cash quotes are often lower.

Solar costs in every state · What's a good price per watt?

Average residential electricity price in California (¢/kWh)

EIA annual averages. Prices rose 6.3% a year from 2015 to 2025; California ranks #2 of 51 for price. Last 12 months through July 2026: 33.0¢.

Show as a table
PeriodValue
'1215.3
'1316.2
'1416.3
'1517.0
'1617.4
'1718.3
'1818.8
'1919.1
'2020.4
'2122.8
'2225.8
'2329.5
'2432.0
'2531.4
Monthly production per kW of solar in California

kWh per kW for a south-facing roof at a 20° tilt, population-weighted across 307 cities (PVWatts, NLR). Total 1,658 kWh a year.

Show as a table
PeriodValue
Jan99
Feb105
Mar141
Apr154
May165
Jun167
Jul173
Aug170
Sep149
Oct134
Nov108
Dec95

How many homes have solar

Homes with net-metered solar (2025)
2,241,381
Share of homes
15.1%
Residential solar capacity
14,480 MW
Growth over the past year
+8.1%
New systems with a battery
61%
New systems leased or PPA
45%

Sources: EIA-861 (2025), EIA small-scale solar estimates, LBNL Tracking the Sun and state interconnection data.

Electric utilities in California

UtilityHomes servedPrice (2026 est.)Typical useTypical-home verdict
PG&E5,055,55640.5¢405 kWh/moWorth it
Southern California Edison (SCE)4,627,24733.8¢468 kWh/moWorth it
LADWP1,415,60227.9¢469 kWh/moWorth it
SDG&E1,378,46545.1¢296 kWh/moWorth it
SMUD601,27519.9¢663 kWh/moWorth it
Imperial Irrigation District142,91619.7¢1,083 kWh/moWorth it
City of Anaheim107,14820.4¢476 kWh/moClose call
Modesto Irrigation District104,67124.2¢751 kWh/moWorth it
City of Riverside101,04223.1¢616 kWh/moWorth it
Turlock Irrigation District80,97618.3¢814 kWh/moWorth it
City of Glendale78,07137.4¢391 kWh/moWorth it
City of Roseville64,55622.4¢681 kWh/moWorth it
City of Pasadena58,60226.4¢460 kWh/moWorth it
City of Santa Clara54,00018.8¢398 kWh/moNot worth it
City of Burbank Water and Power46,71922.6¢491 kWh/moClose call
Liberty Utilities44,50729.1¢510 kWh/moWorth it
City of Redding39,15220.0¢803 kWh/moWorth it
PacifiCorp (Rocky Mountain Power / Pacific Power)36,33914.7¢816 kWh/moNot worth it
Alameda Municipal Power32,36425.3¢361 kWh/moClose call
City of Palo Alto25,67222.5¢516 kWh/moClose call
City of Lodi24,21524.0¢562 kWh/moWorth it
Bear Valley Electric Service23,39543.3¢298 kWh/moWorth it
City of Colton17,36724.2¢517 kWh/moWorth it
City of Azusa15,64621.9¢503 kWh/moClose call
Merced Irrigation District11,85025.4¢597 kWh/moWorth it

Solar by city in California

Protect yourself when buying

  • Check the license. CSLB C-46 (Solar) or C-10 (Electrical) contractor license; B general contractors in limited cases. Look up an installer
  • Cancellation rights. 3 business days to cancel many home-solicitation sales. Solar Energy System Disclosure Document (CPUC, required for IOU customers since 2018 under AB 1070); CSLB Solar Energy System Disclosure; Civ. Code 1689.6 home solicitation 3 business days; AB 2471 (2020) extends to 5 business days for buyers 65+ and bars starting work during the period. How to cancel
  • HOA and solar access. Yes. California Solar Rights Act (Civil Code 714, 714.1) prohibits HOAs and local rules from unreasonably restricting solar.
  • Community solar. Limited: IOU Community Solar Green Tariff and DAC-Green Tariff; a broader program under AB 2316 was adopted by the CPUC in 2024 in a form critics call unworkable.

Installers active in California

Ranked by installations in public records, not by payment. Volume isn't quality: always check licenses and reviews.

  1. Sunrun 258,002 installs
  2. Tesla Energy 229,005 installs
  3. SunPower 122,616 installs · bankrupt
  4. Vivint Solar 87,684 installs · acquired
  5. Freedom Forever 38,323 installs · bankrupt
  6. Semper Solaris 37,349 installs
  7. Baker Electric 26,059 installs
  8. Infinity Energy 23,127 installs
  9. Bright Planet 22,772 installs
  10. Citadel Roofing And Solar 19,239 installs
  11. PetersenDean 19,182 installs
  12. V3 Electric 16,479 installs
  13. Sunnova 16,253 installs · bankrupt
  14. Bright OPS 15,258 installs
  15. Better Earth Electric 13,777 installs

Search all California installers

More about solar in CaliforniaUnder NBT, export value is so low that batteries and high self-consumption are key; an hourly model using ACC values is far more accurate than a flat cents/kWh. Retail rates are very high (PG&E ~35-45 cents/kWh on TOU), so self-consumed solar is valuable. Base Services Charge cannot be offset by solar. Federal 25D ended after 2025; third-party-owned (lease/PPA) systems may still benefit from commercial credits.

Questions about solar in California

Is solar worth it in California in 2026?

For a typical California home, solar is worth it. A 3 kW system costing about $10,700 after state incentives saves about $894 in the first year and pays back in about 10.9 years. Your result depends on your roof, usage, utility and price, so run the calculator for your address.

How much do solar panels cost in California?

A reasonable cash price is around $2.90 per watt before incentives, or roughly $7,400 to $10,400 for a 3 kW system. Public installation records for California show a recent median of $4.51/W, which often includes loan dealer fees.

Does California have net metering?

New customers of PG&E, SCE and SDG&E are on the Net Billing Tariff (often called NEM 3.0): solar you use at home saves the full retail rate, but power you send to the grid is credited at hourly 'avoided cost' values that average only about 4-5 cents/kWh (higher on summer evenings). Batteries greatly improve the economics. Municipal utilities like LADWP and SMUD set their own rules.

Is there a solar tax credit in California?

The 30% federal credit for homeowners ended for systems installed after 2025. California does not offer a state income tax credit for solar that we're aware of. Solar may be exempt from property tax.

How do I check a solar installer's license in California?

CSLB C-46 (Solar) or C-10 (Electrical) contractor license; B general contractors in limited cases.. Look up any installer with the state's license search at https://www.cslb.ca.gov/onlineservices/checklicenseII/checklicense.aspx.

Policy research current as of October 2026; sources include nrgcleanpower.com, sdge.com, pv-magazine-usa.com. Electricity data: EIA, through July 2026. Found something out of date? Tell us.