Solar power in California

Last fact-checked on January 23, 2020, by Catherine Lane

California is one of the best places in the nation to install solar panels. A combination of high average sun exposure, expensive utility rates, solar tax credit, and the state’s net metering law means homeowners can get an excellent return by installing solar panels on their homes.

The Golden State also has some of the most aggressive greenhouse gas emission goals in the nation. California’s renewable portfolio standard requires utilities to derive 60% of their retail electricity from renewable sources by 2030.

California solar power facts

$2.78 watt

Average cost: 5kW solar power system

5 Years 4 Months

Average payback time

$73,714

Average lifetime savings

6¢ kWh

Levelized cost of solar energy

42¢ kWh

If you don’t get solar

8,621 kWh

Annual power production

Cash flow graph based on cash purchase of a 6.06kW system

Cashflow (in USD)Year0510152025$-14,000$-4,500$5,000$14,500$24,000$33,500$43,000$52,500$62,000$71,500

This 6.06kW system would offset 100% of your energy usage if your typical monthly bill in California is $171, however, your situation may vary so try our solar calculator to get a result tailored to you.

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How much can solar panels save you in California

Average total cost of solar panel installation in California

System Size Cash purchase
After 26% solar tax credit
Financed purchase
After 26% solar tax credit
3kw $6,416 $6,929
4kw $8,377 $9,047
5kw $10,286 $11,109
6kw $12,077 $13,043
7kw $13,831 $14,937
8kw $15,451 $16,687
9kw $17,050 $18,414
10kw $18,500 $19,980

How much do solar panels cost in California?

$2.78 per watt

Cash purchased solar system
Before 26% solar tax credit

$3.11 per watt

Financed solar system
Before 26% solar tax credit

$17.3¢ /kWh

Lease/PPA
Ave 15 year term, 2.5% price escalator

What are the pros and cons of installing solar panels in California?

The biggest advantages in California for installing solar panels are the 1-for-1 net metering law and the 26% federal tax credit. California also offers a variety of financing options and incentive programs for low-income households. There are not many disadvantages to installing solar panels in California. If you’re a California homeowner, you’ll be kicking yourself that you didn’t get solar while all of these incentives were still around.

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