Does Solar Make Sense in Southern California?
With 280+ sunny days per year and some of the highest electricity rates in the US, Southern California is one of the best markets for solar ROI in the country.
Federal Tax Credit: Ended for New Home Systems
The federal Residential Clean Energy Credit (IRC §25D) ended for home systems installed after December 31, 2025, under the One Big Beautiful Bill Act of 2025. Under IRS guidance, a system counts as installed when installation is completed, not when it is paid for, so homeowners installing in 2026 should not count on the federal credit. Older articles and quotes that subtract it are out of date.
What Drives the Payback
Payback now depends mainly on how much of the solar output your home uses itself, your utility's current rates and export credits, the system size and roof orientation, and whether a battery is included. Ask for a written production estimate and a payback calculation based on your own utility bills, and check which utility or state programs are open when you sign.
NEM 3.0 and Net Metering
California's Net Billing Tariff (often called NEM 3.0), which took effect for new PG&E, SCE and SDG&E customers in April 2023, changed how utilities credit exported solar power. Pairing solar with battery storage now makes even more financial sense to maximize self-consumption.
What to Watch Out For
Read lease and power-purchase agreements carefully: the savings, escalators and transfer terms when you sell the home all belong in the comparison. Compare any lease against a cash or financed purchase over the same period. See our solar installation service or request a free estimate.
