California enjoys one of the best climates for solar power in the U.S., but it isn’t just sunshine that’s spurring the growth of renewable energy in the Golden State. There are a number of tax credits, exemptions and rebate opportunities that make solar more affordable for its residents. Several of the nation’s best solar companies are based in California as well, which make installations more affordable and accessible.
If you have the funds, paying in cash will maximize your long-term savings. For those without the necessary cash flow, a solar loan will make the most sense. Leases, for the most part, are still guaranteed to save you money, but they come with fewer benefits and less flexibility.
Avg. lifetime savings over 25 years (10 kW)
Avg. payback period
Avg. cost without tax credit (5-10 kW)
Avg. cost with tax credit (5-10 kW)
Avg. cost in CA
Avg. annual power production (10 kW)
Size of Solar Panel System
California Solar Panel Cost
Cost After Federal Tax Credit
5kw
$13,650
$10,101
6kw
$16,380
$12,121
7kw
$19,110
$14,141
8kw
$21,840
$16,162
9kw
$24,570
$18,182
10kw
$27,300
$20,202
Cash purchased Before 26% solar tax credit
Financed Before 26% solar tax credit
Leased Estimate for average lease cost
California is home to progressive incentives like federal tax credit, 1-for-1 net metering, energy storage rebates and grant programs for low-income homeowners.
Some of the best solar companies in the world make their home in California (Tesla, SunPower), making for a lower cost of solar.
California is the fifth sunniest state in the nation.
Solar panel efficiency varies depending on your latitude — the further south you are in the U.S., the more you’ll get out of a small system. The best way to determine whether your home is a good fit for solar electricity is to contact a solar installer in your area. A solar energy specialist can come to take a look at your home and give you a custom recommendation.
Solar panel efficiency can convert over 20% of the sunlight’s energy into electricity, especially if your roof is obstructed by little shade and faces south or west.
Solar panels have long proved a reliable and savvy financial investment for Californians, and many buyers are able to secure a speedy return on investment (ROI). However, there is currently no statewide California solar tax credit to help residents with the upfront cost of solar panels.
That said, all Californians are eligible for the federal solar tax credit, and the state offers several incentive programs and solar rebates aimed at further increasing access to reliable, affordable solar panels.
Self-Generation Incentive Program (SGIP)
The SGIP offers rebates for installing energy storage systems at both residential and non-residential facilities.
Active Solar Energy System Property Tax Exclusion
This incentive ensures the addition of a solar panel installation doesn’t raise homeowners’ property taxes.
Single-Family Affordable Solar Homes (SASH) Program
The California Solar Initiative (CSI) launched SASH to provide fixed, up-front incentives on qualifying affordable single-family housing.
Self-Generation Incentive Program (SGIP)
The SGIP offers rebates for installing energy storage systems at both residential and non-residential facilities.
Active Solar Energy System Property Tax Exclusion
This incentive ensures the addition of a solar panel installation doesn’t raise homeowners’ property taxes.
Single-Family Affordable Solar Homes (SASH) Program
The California Solar Initiative (CSI) launched SASH to provide fixed, up-front incentives on qualifying affordable single-family housing.
by year placed in service
The SGIP offers rebates for installing energy storage systems at both residential and non-residential facilities.
Self-Generation Incentive Program (SGIP)
This incentive ensures the addition of a solar panel installation doesn’t raise homeowners’ property taxes.
Active Solar Energy System Property Tax Exclusion
The California Solar Initiative (CSI) launched SASH to provide fixed, up-front incentives on qualifying affordable single-family housing.
Single-Family Affordable Solar Homes (SASH) Program
*for commercial installations only
The information on our website is general in nature and is not intended as a substitute for competent legal, financial or electrical engineering advice. As forecasting solar savings involves assumptions about future electricity prices you should be aware such estimates are inherently uncertain.
