Solar panels in California: Why is it worth installing?

California leads the United States in transitioning to solar energy. There is a reason why a PV system is a popular choice here. Let’s talk about why it’s worth it to install solar panels in California. 

Lots of sun and high energy costs

California is known as the “Land of Sunshine,” just like Florida. Solar panels in California get about 5.6 hours of when solar panels work at their full power on average throughout the year, which is a lot. A 6-kilowatt solar system is basically enough to take care of the average energy needs of an American house. You can build a system like this with, say, fifteen 400-watt PV modules. Don’t forget that solar panels produce 50% more energy in summer and are capable of taking care of the air conditioning units that often work non-stop during hot months. 

Electricity in California costs a lot, so if you install solar panels, you can save quite a lot of money. In Los Angeles, the average monthly electricity bill is about $220, which is a lot higher than the $150 average for the whole country. When a solar system fully covers your energy consumption, it makes you around $2,500 per year. The average payback of a solar system in California is about 6-8 years and can be even shorter in LA..

An average 6-kilowatt solar system costs about $15,000 to $20,000 in California. You can deduct 30% of its cost from income taxes with the help of the Federal Solar Tax Credit available everywhere across the United States and bring the costs down to $10,000-$15,000. The majority of solar systems in the US are grid-tie and don’t have a battery backup. Energy storage protects you from power outages but increases the cost of a system by more than 50%.  

Streamlined process of going solar

By the end of 2023, California had installed 46,874 megawatts of solar power, which can power around 13.9 million homes in the state. Los Angeles alone has over 650 megawatts of solar installed. California is the top state in the country for solar power, with solar energy making up 28% of all the electricity generated in the state. It’s easy to find solar panels in California for sale and there are lots of contractors that can take care of your project.

The process of getting a solar system in California is ironed and streamlined down to a T. Getting permits from authorities usually takes only a few days compared to weeks in other states. You can often make an application for a PV permit through online platforms. Lots of people have solar systems installed so it’s easy to get advice from acquaintances and neighbors.

In California, homeowner associations (HOAs) can’t stop you from installing solar panels. They can set some rules, but these rules shouldn’t make the solar system more expensive by over $1,000, or make it perform less by more than 10%. There is also the Shade Control Act that helps keep your solar panels free from shade caused by your neighbor’s trees. According to this law, trees or shrubs planted after your solar panels are installed can’t cast shadows covering more than 10% of your panels between 10 a.m. and 2 p.m. Neighbors can also sign solar easements voluntarily to make sure your solar panels get enough sunlight.

Solar incentives and programs

California has been supporting those who want to use solar energy for a long time. To help people with installing PV systems, the state has devised a fair number of solar incentives and programs.

Solar panels in California are free from property tax

In California, if you install solar PV systems before December 31, 2024, you won’t have to pay property taxes on them. This incentive also covers batteries, power conditioning equipment, transfer equipment, and parts. Pipes and ducts used for solar energy can get a 75% reduction in their value.

Similarly, if your solar equipment serves dual purposes, like building-integrated photovoltaics (BIPV), agrivoltaics, floating panels (FPV), or vehicle-integrated photovoltaics (VIPV), you can get a 75% tax reduction on them too.

Solar batteries are cheaper with SGIP

In California, there’s a program called the Self-Generation Incentive Program (SGIP). It gives rebates to homeowners and businesses who install energy storage systems. How much money you get depends on the type and size of the system you install.

Solar panels are exempted from sales tax

In California, sales tax rates vary from 7.25% to 10.25% depending on where you buy things. But if you’re getting solar panels or equipment for solar power systems, you don’t have to pay sales tax. This also applies to batteries. This program will last until July 1, 2030, and you don’t need to apply for the exemption—it’s automatic.