Dean Solar
California – Solar Incentives & Resources

California – Solar Incentives & Resources

Save money by installing solar panels in California.

Frequently Asked Questions

Does CA offer a state tax credit? 

A: No, California does not provide a state tax credit for residential customers that install solar.

Does CA offer a solar sales or property tax exemption?

A: California does offer a property tax exemption that exempts homeowners that install solar from acquiring increased state property tax liability due to an increase in home value from a solar installation. The State does not currently offer a sales tax exemption.

cost of solar

Does CA offer a rebate?

A: There is not a solar-specific- rebate for solar projects in SCE or SDGE utility territories. However, there is a state-based energy storage incentive Program called the Self- Generation Incentive Program (SGIP). 

Solar Panel Cost in California

Average solar panel cost by system size in California

solar panel cost california

Average payback period, savings, and cost of a 5 kW system

The number of years to recover your solar energy investment. (for a 5 kW System)

5.94 Years

20-year savings comparing total cost vs. utility cost for the same amount of electricity, including all costs, incentives, and inflation. (for a 5 kW system)

$56,411

The price of the system on a per-Watt basis. (for a 5 kW system)

$2.91

California Solar Incentives & Rebates

  • Many CA homeowners have access to net metering under the State’s (“NEM-2.0”) Program
  • The Self-Generation Incentive Program (“SGIP”) provides an upfront, incentive payment to residential customers that install energy storage
  • The State also offers a 100% property tax exemption for any increased home value due to the installation of solar
  • Finally, California homeowners may have access to the 26% Federal Investment Tax Credit (ITC)
solar financing

California Electric Utilities

California Customers Eligible for Net Metering

Eligible System Size 
  • Southern California Edison (SCE): Systems can not be built to exceed 100% of the homeowner’s previous 12- month electric consumption. 
  • San Diego Gas & Electric (SDGE): There are no relevant system size limitations.
Solar Crediting
  • Solar energy generated can first be used in real-time by the homeowner to reduce their electric usage from the grid. Using the energy generated on-site maximizes customer savings.
  • Any excess production sent to the grid at the time would be valued at roughly 23c/kWhAny net excess generation sent to the grid is credited at the full retail value of power at that time, minus a non-bypassable charge of roughly 2 cents/ kWh. The retail value of power varies depending on whether the energy is exported during an on-peak, off-peak, or super off-peak interval.
  • For example, if rates are 25c/kWh at 3 pm on a weekday any excess production sent to the grid at the time would be valued at roughly 23c/kWh.
Mandatory Time-of-Use (TOU) Rates 
Southern California Edison (SCE)
  • All SCE customers going solar will be placed on a TOU rate plan if they are not on one already.
  • SCE provides three primary options for solar customers. You can see a brief description below or a complete breakdown here.
  • Option 4-9PM (default) – TOU, $10 fixed monthly, Highest rates: (43c/kWh), Lowest rates: (26c/kWh), Baseline credit: $0.07/kWh.
  • Option  5-8PM – TOU, $10 fixed monthly, Highest rates: (54c/kWh), Lowest rates: (25c/kWh), Baseline credit: $0.07/kWh.
  • Option PRIME – TOU, $12 fixed monthly, Highest rates: (41c/kWh), Lowest rates: (16c/kWh), No baseline credit.
  • All customers will be defaulted to the Option 4-9 PM rate plan but have the opportunity to contact the SCE Billing Dept. to switch rates.
San Diego Gas & Electric (SDGE)
  • All SDGE customers going solar are placed on a TOU rate plan.
  • SDGE provides many rate options for solar customers. You can see a brief description below or a complete breakdown here under Residential TOU Rates.
  • TOU-SES (default) – TOU, $10 fixed monthly, Highest rates: (61c/kWh), Lowest rates: (28c/kWh), No Baseline credit.
  • TOU-DR1 – TOU, $10 fixed monthly, Highest rates: (60c/kWh), Lowest rates: (30c/kWh), Baseline credit: $0.08/kWh. 
General Tips to Save Money with TOU
  • The highest savings will be experienced when using the on-site,  solar energy being produced in real-time.
  • Stay within your Baseline Usage if you are on an applicable rate plan. Customers that use less than their Baseline Usage are charged for power at a lesser rate. Learn more here.
  • A smart thermostat can also help ensure AC units are consuming less power during the more expensive on-peak periods.
  • It is also encouraged to shift usage (ie. laundry, dishwasher, etc) to cheaper off-peak periods when the price of power is cheapest. 
  • On-peak and off-peak hours will vary from plan to plan so make sure to have a clear understanding of when these periods are.

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Eligibility & Redemption

Solar incentives apply to eligible residential customers. 

Incentive programs are offered and administered by government agencies. 

Eligibility and availability vary and are outside of Dean Solar’s control. 

Most programs are limited to a total dollar amount that can be dispersed or will expire on a certain date. 

Be sure to visit the program’s website for the most up-to-date information on availability, eligibility, and redemption requirements.

Your eligibility for income tax credits depends on your personal tax situation. 

Dean Solar recommends speaking with a tax professional for guidance.