Solar Panels in California
#1 Solar State in the United States
$2,100/yr
Avg. Annual Savings
5.8 peak hrs/day
Peak Sun Hours
11–15 years
Payback Period
$16,000–$26,000
Avg. System Cost
Overview
Is Solar Worth It in California?
California has committed to going solar in a big way -- the state leads the nation in installed solar capacity and was the first to require solar panels on all new residential construction. With high electricity rates, abundant sunshine, and a robust incentive ecosystem, California homeowners have more reasons than ever to go solar.
The state recently transitioned to NEM 3.0 net metering, which changes the economics slightly but still makes solar a strong investment, especially when paired with a battery storage system.
Benefits
Why Go Solar in California
Reduce Your Electric Bill
California homeowners save an average of $2,100/yr after going solar.
State & Local Incentives
California offers property tax exemptions, net metering credits, and other state-level incentives that reduce your net cost. The federal 30% ITC expired Dec 31, 2025.
Increase Home Value
Solar panels increase your home's resale value — and are excluded from property tax in most states.
Energy Independence
Lock in your electricity rate and protect against rising utility costs for 25+ years.
Available Incentives
California Solar Incentives & Tax Credits
NEM 3.0 Net Metering
Net MeteringCalifornia's updated net metering program credits excess solar energy at a "avoided cost" rate. While lower than the old NEM 2.0, pairing solar with battery storage maximizes your savings under NEM 3.0.
SGIP Battery Rebate
RebateThe Self-Generation Incentive Program (SGIP) offers rebates for battery storage systems, making solar + battery combinations more affordable.
Property Tax Exclusion
Tax ExemptionCalifornia excludes the added value of solar installations from property tax assessments until the property is sold.
Federal Solar Tax Credit (Expired)
Tax CreditThe federal 30% residential solar tax credit (Section 25D) expired December 31, 2025 and is no longer available for new purchases in 2026. California homeowners should focus on the SGIP battery storage rebate, the Property Tax Exclusion, and NEM 3.0 net billing.
What Changed in 2026 for California Solar
The federal solar tax credit expired December 31, 2025 — here's what that means for California homeowners and what options remain.
The 30% Federal Tax Credit Has Expired
The federal Residential Clean Energy Credit (Section 25D) expired December 31, 2025. California homeowners purchasing solar in 2026 will not receive the 30% federal credit. A typical 8kW system that previously cost ~$14,000 after the ITC now costs $20,000–$28,000 before California-specific incentives. California already had the most expensive solar market in the country, and the ITC expiration adds further pressure on upfront costs.
Lease and PPA Customers Are the Exception
Solar leases and Power Purchase Agreements (PPAs) are widely available in California and remain a strong option in 2026. The installer owns the system and can claim commercial federal credits, passing savings through in the monthly rate. California has the most mature solar financing market in the US, with multiple lease/PPA providers competing aggressively -- particularly in the wake of NEM 3.0.
NEM 3.0 + ITC Expiration: The New California Math
California's shift to NEM 3.0 (Net Billing Tariff) in April 2023 already reduced export credits by ~75% for new solar customers, lengthening payback periods significantly. The ITC expiration adds another 2–3 years to that math. However, California's Self-Generation Incentive Program (SGIP) for battery storage, the Property Tax Exclusion, and rising PG&E/SCE/SDG&E rates (among the highest in the nation) continue to support solar investment. Pairing solar with battery storage is increasingly the recommended approach in California to maximize self-consumption under NEM 3.0.
Common Questions
California Solar FAQ
Local Solar Companies
Solar Companies by City in California
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