California Solar Savings 2026
How Much Does Solar Save
in California? It Depends
on Your Utility.
A $300 PG&E bill saves differently than a $300 SDG&E bill. The rate structure, NEM 3.0 export values, and financing options are different for every California utility — and that changes your savings by hundreds of dollars a year. Here are the real 2026 numbers, broken down by utility, monthly bill size, and how you finance it.
depending on utility & bill
no tax credit required
all 5 CA utilities
CSLB #1065773
2026 Savings Data — All CA Utilities
How Much Does Solar Save by Utility in California?
Solar savings in California are not one-size-fits-all. SDG&E customers save the most — their rates are the highest in the state. SMUD customers save less per month but keep more of it because Sacramento still offers favorable net metering. PG&E and SCE customers land in the middle, with savings that improve significantly when a battery is added under NEM 3.0. Select your monthly bill below to see what solar actually saves in 2026.
| Utility | Avg Rate (peak) | Est. Monthly Savings | Annual Savings | Best Program |
|---|---|---|---|---|
| PG&E | $0.44–0.55/kWh | $140–$185 | $1,680–$2,220 | LightReach PPA |
| SCE | $0.38–0.50/kWh | $130–$175 | $1,560–$2,100 | LightReach PPA |
| SDG&E | $0.45–0.58/kWh | $160–$210 Highest Rates | $1,920–$2,520 | GoodLeap PPA |
| SMUD | $0.13–0.22/kWh | $100–$140 Best Net Metering | $1,200–$1,680 | Prepaid Program |
| Pioneer CCA | PG&E delivery rates | $125–$165 | $1,500–$1,980 | GridGen ($0 down) |
Savings estimates based on PG&E E-TOU-C, SCE TOU-D-PRIME, SDG&E DR-SES, and SMUD residential rate schedules — May 2026. Assumes system sized to offset 90–100% of usage, paired with battery storage under NEM 3.0 for PG&E/SCE/SDG&E. Actual savings vary by home size, usage, shading, and program availability. These are estimates, not guarantees.
Why SDG&E Customers Save the Most — and Why Battery Changes Everything
San Diego Gas & Electric has the highest residential electricity rates in the continental US — averaging $0.45–$0.58/kWh at peak hours under the DR-SES time-of-use schedule. Every kWh your panels produce is a kWh you don't buy at that rate. For PG&E and SCE customers under NEM 3.0, adding a battery is what closes the gap — it lets you store midday solar and use it during the 4–9 PM peak window when grid power costs most, instead of exporting it for pennies. Solar without storage in 2026 leaves 30–40% of your potential savings on the table in IOU territory.
Why Does Your Utility Change How Much Solar Saves?
Rate per kWh
SDG&E and PG&E charge the most — meaning each solar kWh you produce replaces the most expensive grid power. SMUD charges far less, so the per-kWh savings are lower.
Export credit (NEM 3.0)
PG&E, SCE, and SDG&E pay ~$0.05–$0.08/kWh for excess solar exported to the grid. SMUD still credits at full retail. That gap is why battery storage matters more for IOU customers.
Financing programs
SMUD territory has the strongest rebate stack in California — up to $5,400 per Powerwall plus $440/year in VPP payments. SDG&E territory qualifies for SGIP Equity Resiliency if income-qualified.
Fixed monthly charges
PG&E charges a minimum $25/month connection fee regardless of solar production. SDG&E charges $16/month. These non-bypassable charges set a floor on your bill — solar cannot eliminate them.
NEM 3.0 & Battery Storage — 2026
Does Solar Still Save Money in California After NEM 3.0?
Yes — but the way it saves money changed in April 2023 when the CPUC replaced net metering with NEM 3.0 (Net Billing) for PG&E, SCE, and SDG&E customers. Under the old rules, excess solar exported to the grid earned close to full retail credit. Under NEM 3.0, that same export earns roughly $0.05–$0.08/kWh — about 75% less. Solar-only still saves money. Solar plus a battery saves significantly more. Here's exactly how the math breaks down.
| Scenario | Monthly Savings (PG&E $300 bill) | Monthly Savings (SDG&E $300 bill) | Export Value | Outage Protection |
|---|---|---|---|---|
| ☀️ Solar Only | $110–$145 | $130–$170 | ~$0.06/kWh | None |
| ☀️🔋 Solar + Battery | $175–$225 | $210–$280 | Retail avoided | Yes — whole home |
| 🏠 No Solar (grid only) | $0 saved | $0 saved | N/A | None |
Based on PG&E E-TOU-C and SDG&E DR-SES peak rates, May 2026. Solar + battery savings assume 85%+ self-consumption via battery discharge during 4–9 PM peak window. Estimates only — actual savings depend on system size, usage habits, and shading.
How a Solar + Battery System Works Under NEM 3.0
6am – Noon
Panels Power Home
Solar covers daytime loads directly. Every kWh used = full retail rate avoided.
Noon – 4pm
Battery Charges
Excess midday solar charges the battery instead of exporting at ~$0.06/kWh.
4pm – 9pm
Battery Discharges
Battery powers home through PG&E's most expensive window — $0.44–$0.55/kWh avoided.
9pm – 6am
Off-Peak Grid
Home draws from grid at lowest overnight rates if battery is depleted.
⚠️ What NEM 3.0 Actually Means for Your Bill
If you install solar without a battery on PG&E, SCE, or SDG&E, your panels will produce power midday that your home may not fully use — and that excess gets exported to the grid at roughly $0.06/kWh. Then at 4–9 PM when your home needs power most, you pull from the grid at $0.44–$0.55/kWh. That gap is where savings disappear. A battery closes it by storing cheap midday solar and deploying it during the expensive evening peak. See our full home battery guide for a breakdown of Tesla Powerwall, SolarEdge, and Enphase options in California.
SMUD Customers: You're the Exception
Sacramento Municipal Utility District is not subject to NEM 3.0. SMUD operates its own net metering program and credits excess solar at full retail rates — a major advantage over PG&E, SCE, and SDG&E customers. A battery is still valuable for backup power and rate optimization under SMUD's time-of-use schedule, but it's not financially essential the way it is for IOU customers. SMUD also offers up to $5,400 per Powerwall in rebates and $440/year per Powerwall in VPP payments — making it the strongest battery incentive stack in California. Verify current SMUD rates at smud.org →
Related guides
Cash · Loan · PPA — 2026
How Does Financing Change What Solar Saves?
The size of your solar savings depends almost as much on how you finance the system as on how many panels you install. Cash buyers keep the most long-term. Loan buyers keep ownership but carry a monthly payment. PPA and prepaid program customers save from day one with no money down and no maintenance responsibility — and in 2026, with the federal 25D tax credit expired for homeowner-owned systems, that difference matters more than it used to.
Cash Purchase
Own the system outright
Solar Loan
Own with financing
PPA / Prepaid Program
$0 down · no ownership
⚠️ The Federal 25D Tax Credit Expired December 31, 2025
Homeowners who purchase solar systems outright or via loan can no longer claim the 30% federal residential clean energy credit (25D) as of January 1, 2026. This significantly changes the cash and loan math. However, the 48E commercial credit still applies through 2027 to leasing companies and PPA providers — meaning that 30% savings is still available, just structured differently. The leasing company claims it and passes the benefit to you as lower monthly costs or upfront savings. See our full California solar incentives guide →
Why Most California Homeowners Are Choosing PPAs in 2026
With the 25D tax credit gone for owned systems, the equation shifted. A homeowner buying cash or financing a loan now carries the full system cost without the 30% federal offset. A PPA customer gets the same panels, the same production, the same savings — with zero upfront cost, zero maintenance, and a provider who still benefits from 48E and passes it forward. For California homeowners without significant tax liability or a strong preference for ownership, the 2026 financing math increasingly favors PPAs.
See My Savings Estimate →| Financing Type | $0 Down | Saves Day 1 | You Own It | Tax Credit Benefit | Maintenance on You |
|---|---|---|---|---|---|
| 💵 Cash | ✗ No | ✓ Yes | ✓ Yes | ✗ Expired | ✗ Yes |
| 🏦 Loan | ✓ Yes | ~ Sometimes | ✓ Yes | ✗ Expired | ✗ Yes |
| ⚡ PPA / Prepaid | ✓ Yes | ✓ Yes | ✗ No | ✓ Passed to you | ✓ No |
Federal 25D credit expired 12/31/25. 48E credit available to system owners (leasing co/PPA provider) through 2027. Program availability varies by utility territory and credit approval. Not financial advice — consult a tax professional regarding your specific situation.
Real California Homeowners — Real Savings
What California Homeowners Are Actually Saving in 2026
"My SMUD bill went from $340 a month to $22. Ed walked me through every option and never pressured me. The program made the most sense for our situation and we're saving on day one."
"We were paying $420/month to SDG&E. I didn't think solar would work for us after all the NEM 3.0 news. Ed explained the battery piece and now our bill is under $30."
"I called three solar companies. Ed was the only one who actually broke down the numbers by my utility and bill size. No fluff, just math. Signed in two weeks."
See Your Exact Savings
by Utility and Bill Size
The table above shows ranges. The calculator gives you your number — based on your actual utility, your actual bill, and the programs available in your ZIP code right now.
Calculate My Savings →across all 5 utilities
sales experience
PPA programs
PG&E · SCE · SDG&E · SMUD · Pioneer
Frequently Asked Questions
California Solar Savings — Common Questions Answered
Real answers from 10 years and 400+ California solar closings across PG&E, SCE, SDG&E, SMUD, and Pioneer territories.
Most California homeowners with solar save between $150 and $400 per month in 2026, depending on their utility, monthly bill size, and whether they add battery storage. SDG&E customers save the most because San Diego Gas & Electric has the highest residential rates in the continental US — averaging $0.45–$0.58 per kilowatt-hour at peak. SMUD customers in Sacramento save less per month but benefit from superior net metering. PG&E and SCE customers under NEM 3.0 need a battery to maximize savings — solar alone still saves money, but adding storage captures the full opportunity during the expensive 4–9 PM peak window.
Yes — solar is still worth it in California in 2026, but the strategy changed after the CPUC introduced NEM 3.0 in April 2023. Under the old net metering rules, excess solar exported to the grid earned close to the full retail rate. Under NEM 3.0, that export earns approximately $0.05–$0.08 per kilowatt-hour — about 75% less. Solar-only systems still reduce your bill by offsetting daytime usage directly. Solar paired with a battery, however, stores midday production and deploys it during the 4–9 PM peak window when grid electricity costs most — recovering the savings that NEM 3.0 would otherwise leave behind. SMUD customers are unaffected by NEM 3.0 and continue to receive full retail net metering credits.
The federal 25D residential clean energy credit — which gave homeowners a 30% tax credit for purchasing solar — expired on December 31, 2025. California homeowners who buy or finance a solar system in 2026 can no longer claim this credit on their personal tax return. However, the 48E commercial credit remains available through 2027 for companies that own solar systems — such as PPA providers and leasing companies. These companies pass that 30% benefit to customers in the form of lower monthly costs or upfront program savings. If you want the equivalent of a 30% discount on solar in 2026 without owning the system, a power purchase agreement or prepaid program is currently the most direct path to that benefit.
SDG&E customers save the most per month because San Diego Gas & Electric charges the highest residential rates in California — up to $0.58 per kilowatt-hour at peak under the DR-SES time-of-use schedule. A $300 SDG&E bill typically yields $160–$210 in monthly solar savings with a battery. PG&E customers pay the second-highest rates at $0.44–$0.55 per kilowatt-hour under E-TOU-C, with $140–$185 in monthly savings on a $250 bill with storage. SMUD customers save less per kilowatt-hour but benefit from the best net metering program in California and the strongest battery rebate stack — up to $5,400 per Powerwall plus $440 per year in virtual power plant payments. SCE customers land between PG&E and SDG&E in rate levels and savings potential.
The most accurate way to estimate your personal solar savings is to enter your current monthly bill amount and utility into a calculator that uses your utility's actual 2026 rate schedule. The ranges in this guide are accurate for most California homeowners, but your result will vary based on your home's square footage, roof orientation, local shading, and whether you add battery storage. The Solar With Watts calculator takes your utility, monthly bill, and ZIP code and returns a savings estimate based on current rates for PG&E, SCE, SDG&E, SMUD, and Pioneer Community Energy — in about 60 seconds, with no credit pull and no obligation. If you want a detailed system proposal with exact equipment pricing and program options, request a free estimate here.
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