How Much are Solar Panels in California, Here's a Cost Breakdown

Solar installations in California offer significant savings potential, but costs and benefits can vary depending on system size and location. Let's explore the costs and savings for 5kW and 10kW systems across different regions of California.Installation Costs

5kW Systems

The average cost for a 5kW solar system in California ranges from $12,500 to $17,300 before federal tax credits1. After applying the 30% federal tax credit, the cost drops to approximately $8,750 to $12,110.

10kW Systems

For a 10kW system, the cost before tax credits typically ranges from $25,000 to $34,6001. After the federal tax credit, this reduces to about $17,500 to $24,220.

‍

Regional Cost Variations

While these figures represent state averages, costs can vary by region:

• Northern California: Typically slightly higher due to lower sun exposure
• Central Valley: Often lower due to more abundant sunlight and lower installation costs
• Southern California: Generally close to the state average, with some variations based on local factors

Potential Savings

Savings from solar installations can be substantial but vary based on system size, location, and local electricity rates.

5kW Systems

A 5kW system in California can potentially save homeowners $1,500 annually on average2. Over 25 years, this could amount to $37,500 in savings, assuming a 2-3% annual utility rate increase.

10kW Systems

For a 10kW system, annual savings could reach around $3,000, potentially resulting in $75,000 in savings over 25 years.

Regional Savings Variations

Savings can differ across California regions:

• San Francisco Bay Area: Higher electricity rates can lead to greater savings
• Los Angeles: Abundant sunshine can increase energy production and savings
• San Diego: Combination of high electricity rates and ample sunlight often results in significant savings

Factors Affecting Savings

1. Electricity Rates: Areas with higher rates typically see greater savings
2. Sun Exposure: Regions with more sunlight produce more solar energy
3. Local Incentives: Some areas offer additional rebates or incentives
4. Net Metering Policies: Can significantly impact long-term savings

‍

‍