Is solar still worth it in San Diego in 2026?
It can be, but the math changed twice. Since 2023, power you send to the grid earns a few cents per kWh instead of retail, and the 30% federal tax credit ended for homeowner-owned systems after 2025. A battery is now central to the payback.
- Export credit
- ~5–8¢/kWh
- Peak SDG&E rate
- 60¢+/kWh
- Federal credit
- Ended
- Payback w/ battery
- ~6.5–8.5 yrs
Midday, under net billing
4–9 p.m., installer estimate
Owned systems after 2025
Installer estimate
The short version
- Systems that applied to connect after April 14, 2023 are on California's Net Billing Tariff, which credits exported power at much lower avoided-cost values than retail.
- Installer estimates put midday export credits around 5–8 cents per kWh, against SDG&E peak prices of roughly 60 cents or more from 4 to 9 p.m.
- The 30% federal residential clean energy credit was ended by 2025 federal legislation for systems installed after December 31, 2025.
- Leased and third-party-owned systems may still benefit from a separate commercial credit for a limited time.
- Because daytime exports are worth little, a battery that shifts solar power into the evening peak now drives most of the savings.
San Diego has some of the highest electricity prices in the country, which should make solar an easy yes. Two rule changes made it a closer call: California cut what you're paid for exported power in 2023, and the federal tax credit for homeowner-owned systems ended after 2025.
Then vs. now
| Old net metering (NEM 2.0) | Net billing (since April 2023) | |
|---|---|---|
| Exported power | Credited near retail | Credited at avoided-cost values, often a few cents per kWh |
| Best strategy | Export as much as possible | Use your own solar, especially in the evening peak |
| Batteries | Optional | Central to the payback |
| Federal tax credit | 30% for owned systems | Ended for owned systems installed after 2025 |
Who should still look closely
- High evening use: households running AC, EVs or pools from 4 to 9 p.m. benefit most from solar plus storage.
- Long-term owners: paybacks of roughly 6.5 to 8.5 years with a battery, per installer estimates, favor people staying put.
- Leasing: third-party-owned systems may still qualify for a commercial federal credit for a limited time; ask how it's reflected in your price.
- Existing NEM customers: keep your legacy terms; adding panels can affect them, so ask before expanding.
SOURCES
Everything above traces back to one of these. Follow them — if one has changed and we haven't, that's our mistake, not yours.
- BackgroundResidential solar tax credit changes
Solar Energy Industries Association · Checked October 6, 2026
25D ended after 2025; leased systems
California Public Utilities Commission · December 2022
Net billing rules
- BackgroundIs solar worth it in San Diego?
Solar.com · Checked October 6, 2026
Installer estimates of rates, costs and payback