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Home solar in California

New rooftop systems are on the Net Billing Tariff (NEM 3.0): power you send to the grid earns a low, hourly 'export credit', so a battery that saves solar for the evening is now key to savings.

Facts checked 2026-11-01, each with a source link below. Programs change often: confirm with your utility, installer and a tax professional before you sign.

29.8¢average home price per kWh (EIA, August 2026)
Solar can workCalifornia has the highest power prices of these states (about 30 cents/kWh), so using your own solar pays well. But export credits are usually far below retail, the property tax break ends for systems finished after 2026, and the state's community solar plan is widely seen as unworkable.

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Net metering Replaced by a lower credit

For PG&E, SCE and SDG&E customers who applied on or after April 15, 2023, the Net Billing Tariff pays exported power at an hourly 'value to the grid' rate (Energy Export Credits), usually well below retail but higher on late-summer evenings. Credits roll over month to month until the yearly true-up, and you must be on an electrification time-of-use rate (E-ELEC, TOU-D-PRIME or EV-TOU-5). You keep the tariff for 9 years; PG&E and SCE homes that connect before the end of 2027 get a small extra export credit for 9 years. Older NEM 1.0/2.0 homes keep their terms for 20 years from connection. Source

  • 2023-04-15: Net Billing Tariff starts for new applications
  • 2026 (about March): Court of Appeal again upholds the Net Billing Tariff after a 2025 California Supreme Court remand
  • 2027-12-31: last year PG&E/SCE homes can connect and still get the 9-year export adder

Solar credits (SRECs) No market

California has no SREC market for home systems. Your utility keeps the value of exported power through the export credit. Source

Rebates and incentives

DAC-SASH (Disadvantaged Communities Single-family Solar Homes)

Free or low-cost solar for qualifying low-income homeowners

Income-qualified homeowners in disadvantaged communities (PG&E, SCE, SDG&E areas); run by GRID Alternatives

open grant Source

Taxes

Property tax: Exempt for systems completed before 1-1-2027 (Rev. & Tax. Code §73); SB 710 (Ch. 328, 2025) lets those systems keep it until the home is sold. Systems finished in 2027 or later get no exclusion unless a new law passes (AB 2389, which would have extended it, was held in committee 5-14-2026).
Sales tax: None: California has no sales tax exemption for home solar. Source

Solar laws

  • Solar Rights Act, Civil Code §714 and §714.1 (1978). HOA rules and deed covenants that effectively ban or restrict solar are void. For solar panels, a rule is not allowed if it adds more than $1,000 to the cost or cuts output more than 10%. An HOA that does not deny an application in writing within 45 days is deemed to have approved it. Source
  • SB 710 (Ch. 328, Statutes of 2025) (2025). Keeps the solar property tax exclusion for systems that qualify before 1-1-2027 until the home changes owner. Source
  • AB 942 (2025) (2025). Would have moved older net-metering homes to net billing when sold; the Senate committee stripped that in July 2025. Final status not confirmed. Source
  • CPUC community solar decision (R.22-11-013 follow-up) (2026). In June 2026 the CPUC adopted a community solar framework using ReMAT/avoided-cost pricing, rejecting the industry's Net Value Billing Tariff; solar groups say few or no projects will be built. Source

Community solar

Technically yes, but limited: the June 2026 CPUC framework pays low avoided-cost rates and industry groups expect few new projects.

Timeline

  1. CPUC adopts Net Billing Tariff (D.22-12-056)
  2. Net Billing Tariff applies to new applications
  3. California Supreme Court sends Net Billing challenge back to the Court of Appeal
  4. SB 710 signed (property tax exclusion kept for pre-2027 systems)
  5. Federal 30% homeowner tax credit (25D) ends
  6. Court of Appeal reaffirms Net Billing Tariff
  7. CPUC adopts community solar framework

Federal tax credits

The 30% federal tax credit for homeowners who buy solar (Section 25D) ended for systems placed in service after December 31, 2025, so buying no longer earns a federal credit. If you lease or sign a power purchase agreement (PPA), the panels belong to a company that may still claim a business credit under federal deadlines that tighten through 2027. Ask your installer whether that savings is in your price.

Sources

Last checked 2026-11-01. Incentives are not guaranteed and can change or run out. Confirm every figure with your utility, installer and a tax professional before you sign. This page is general information, not tax, legal or financial advice.

We give free home reviews in Maryland, DC and Virginia today. How to compare solar options