Why San Diego is the Perfect Place for Solar
In 2026, San Diego is one of the best cities in the U.S. to go solar. With abundant sunshine year-round and high electricity rates, switching to solar power can lead to significant energy savings. But how much does it cost to install a solar panel system in San Diego?
This guide breaks down solar panel costs, pricing factors, incentives, financing options, and return on investment (ROI).
Average Cost of Solar Panel Installation in San Diego
The price of solar varies based on system size, panel efficiency, and installation complexity. On average, San Diego homeowners can expect:
- $2.37 per watt, including installation
- $11,859 for a 5 kW solar panel system before incentives
- $8,301 after applying the 30% federal tax credit
A 7.2 kW system typically costs $17,064 upfront or $11,945 after incentives. The good news is that solar panel costs have been decreasing, making solar more accessible.Â
Factors Affecting Solar Installation Costs in 2026
1. System Size & Energy Use
Larger systems cost more but provide greater long-term energy savings. A home with higher electricity usage will require more panels, increasing the overall cost.
2. Type & Quality of Panels
- Monocrystalline Panels: High efficiency, slightly more expensive
- Polycrystalline Panels: Lower efficiency, more affordable
- Premium Brands (SunPower, LG, etc.): Higher cost but better performance
3. Roof Condition & Complexity
The shape, material, and slope of your roof impact installation costs. Spanish tile or steep roofs require additional labor and mounting hardware, raising the total price of solar installation.
4. Permitting & Regulatory Costs
California has a cap on residential solar permit fees (typically under $450), but additional costs like electrical panel upgrades may apply.
5. Installation Company & Labor Costs
Choosing a reputable installation company can impact the price of solar. Local and national providers offer different pricing, warranties, and financing options.
Solar Incentives & Rebates in San Diego
Federal Solar Tax Credit (ITC) - ()
The Residential Clean Energy Tax Credit ended in 2025 however stay up to date with the latest credits below.
Check the Energy Star website to view any current tax credits.
California Solar Incentives
- California Solar Initiative (CSI): Rebates for low-income households
- Property Tax Exclusion: Solar installations do not increase property tax assessments
Net Energy Metering (NEM 3.0)
- Credits homeowners for excess solar energy sent to the grid
- Under NEM 3.0, exported energy earns lower credits, making battery storage more beneficial
Self-Generation Incentive Program (SGIP)
Homeowners adding battery storage (like Tesla Powerwall) can receive rebates to reduce costs.
Financing Options for Solar Panels in San Diego
Homeowners can choose from multiple financing options to make solar more affordable.
Cash Purchase
- Maximizes long-term savings
- Eliminates interest payments
Solar Loans
- Finance over 5 to 20 years with fixed monthly payments
- Homeowners can still qualify for tax credits
Solar Leases & Power Purchase Agreements (PPAs)
- No upfront costs
- Homeowner pays for the electricity generated, but does not own the system
- Leases and PPAs do not qualify for tax incentives
PACE Financing
- Allows repayment through property tax assessments
- No credit score requirement
ROI & Long-Term Savings of Going Solar
How Much Can You Save?
- San Diego homeowners can save $30,000 - $50,000 over 25 years
- A properly sized solar panel system can reduce 50-90% of monthly electricity bills
Payback Period
Most homeowners recoup their solar investment within 4-8 years.
Increased Home Value
Homes with solar panels sell for an average of $4,000 - $6,000 more per installed kilowatt.
Environmental Impact
A typical residential solar panel system in San Diego can offset over 140 tons of COâ‚‚ emissions over its lifetime.
Is Solar Worth It in 2026?
Want to see how much you could save? Use Google Sunroof to estimate your solar savings based on your home's location and roof exposure.
San Diego homeowners benefit from high energy rates, generous incentives, and year-round sunshine. Even with net metering changes, the ROI remains strong, and energy independence is within reach.
To find out how much you can save, get a free, no-obligation quote from Semper Solaris—a veteran-owned, American-made solar installation company dedicated to helping homeowners achieve energy independence. Learn more about solar installation in San Diego.
Switch to solar today! Contact Semper Solaris for a free consultation.
