Solar Panel Cost in California (2026): NEM 3.0, Prices and Payback

If you are a PG&E, SCE or SDG&E customer and apply now, you are on the Net Billing Tariff, which most people call NEM 3.0. Customers applying for interconnection on or after April 15, 2023 are on the Net Billing Tariff (Solar Billing Plan) under CPUC Decision D.22-12-056. Exports are credited at Avoided Cost Calculator values instead of retail rates.^[5] Exported energy earns hourly credits from the CPUC's Avoided Cost Calculator, which are high on summer evenings and low at sunny midday, when most rooftop solar exports. The original customer who interconnects under the NBT is guaranteed the NBT for nine years. Customers who move to the NBT from an older NEM tariff do not get this legacy period.^[5] You also have to move to an electrification time-of-use rate: NBT customers must use a specific 'electrification' TOU rate: E-ELEC (PG&E), TOU-D-PRIME (SCE), EV-TOU-5 (SDG&E). Bills are paid monthly, and excess credits roll over until the annual true-up.^[5]

PG&E, SCE and SDG&E now bill a monthly fixed charge to almost every residential customer, with or without solar. On May 9, 2024 the CPUC approved a monthly fixed charge ('Base Services Charge') of $24.15, with $6 for CARE and $12 for FERA or deed-restricted affordable housing. It lowers per-kWh prices by 5-7 cents. Start dates: SDG&E October 2025, SCE November 2025, PG&E March 2026. Solar customers pay it too.^[7] Solar cannot reduce it, and at SDG&E it cannot even be paid with export credits: For Solar Billing Plan customers the Base Services Charge is non-nettable, so export credits cannot pay it.^[8] It does not change whether solar pays, but it does mean your bill will never reach zero.

Municipal utilities are not under the CPUC's Net Billing Tariff:

• LADWP (Los Angeles) still credits exports at retail energy prices under its own net metering rider, which makes a system sized to your yearly use the simplest choice. Its average residential price was 23.84¢ per kWh^[2].
• SMUD (Sacramento) pays a flat 9.60¢ per kWh^[9] for exports on its Solar and Storage Rate, and offers $300 per kWh of battery, up to $6,000 per household, for interconnection applications submitted on or after Sept. 23, 2026. Earlier projects got $500/kWh up to $10,000 if enrolled by Dec. 31, 2026. Tesla owners also receive quarterly payments.^[10].

The difference is large enough that the same system pays back years faster in some cities than in others; see the city pages below.

Because exports at midday earn little and evening power is expensive, a battery that stores afternoon solar for the evening peak is more valuable in PG&E, SCE and SDG&E territory than almost anywhere else. State battery rebates have mostly run dry: SGIP Small Residential Storage^[11] is closed^[11], and the low-income budget is on a waitlist. Price a battery on the yearly value of the energy it shifts. Our battery comparison lists usable capacity and power from the spec sheets.

California caps what a city can charge for a residential solar permit: Cities and counties may not charge more than $450 plus $15 per kW above 15 kW for a residential PV permit. A jurisdiction can charge more only with a written finding and an adopted resolution or ordinance showing the reasonable cost. The section sunsets January 1, 2034.^[14] Cities and counties must offer an online automated permitting platform such as SolarAPP+ for residential solar up to 38.4 kW AC and paired batteries. Deadlines: September 30, 2023 for jurisdictions over 50,000 people and September 30, 2024 for cities of 50,000 or fewer. Exempt: cities under 5,000 people and counties under 150,000 (including their cities).^[15] Every solar sale needs a standard disclosure document, and you have a right to cancel; our California installer guide covers both and shows how to look up a contractor's license with the CSLB.