San Francisco residents face some of the highest electricity bills in the US — not to mention a higher cost of living than most places in the country. For some, solar panels are the way to slash energy costs.
Energy costs for San Franciscans were 86.2% higher than the national average in September 2023, according to the US Bureau of Labor Statistics. In the past five years, the average electricity bill for San Franciscans was at least 59.7% higher than the average for households in the country. To tamp down some of these rising costs, it’s worth considering if going solar is the right choice for you.
“In California, the payback periods are going to be 10, 11 or 12 years on average,” said Dave Rosenfeld, the executive director at Solar Rights Alliance, a San Diego-based renewable energy advocacy group.
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California residents have access to incentives at the state and federal levels that make installing solar panels more appealing — like the state’s net metering program and the federal residential clean energy credit.
That said, your potential savings hinges on a handful of factors – including your home and solar system size. Here, we’ll walk you through what to anticipate if you want to install solar panels in San Francisco.
Best national solar panel companies in San Francisco
Local solar panel installers in San Francisco
How to determine which solar company in San Francisco is best for me
According to the Solar Energy Industries Association (SEIA), you can find 2,400 solar companies in California, including more than 1,000 developers and installers. Because the state is one of the largest solar markets in the country, you’ll want to spend time exploring your different options.
Factors to mull over include a solar company’s full suite of services, customer reviews and ratings, the length and scope of service warranties, and cost of maintenance for solar panels. Some companies will cover the cost of maintenance.
The average cost of solar panels in San Francisco
The cost of your solar panel system can vary and depends on the size of the system, where you live, installation materials, tax incentives and rebates, the type and condition of your roof, and what financing route you’ve landed on. In the state of California, expect to pay at least $10,000 to $20,000 for a home system.
If you want to be completely off the grid, you’ll need to tack on the cost of a solar battery, which can generally run $12,000 to $22,000.
Here’s a look at data for the average cost of a solar panel system in California, according to FindEnergy.com and the Lawrence Berkeley National Laboratory.
California solar panel costs
|Price per watt
|System size (kW)
San Francisco solar panel incentives and rebates
The cost of solar panels in the state of California as a whole has dropped dramatically in recent years. Tax incentives, rebates, and other programs can help you save even more. Here’s what’s available for San Francisco residents:
San Francisco solar incentives
|Disadvantaged Communities – Single Family Solar Homes (SAC-DASH)
|Homeowners who are Pacific Gas & Electric customers and live in eligible disadvantaged communities can receive financial support to go solar.
|Federal tax credit
|Solar systems are eligible for a 30% tax credit for the year the solar panels were installed.
|Net metering programs
|California has net metering programs, which is where consumers can sell back to the energy grid excess solar energy generated by their home system. Under a recent change in the policy, known as NEM 3.0, homeowners will sell energy at a much lower rate than they could previously.
|Self-Generation Incentive Program (SGIP)
|SGIP offers rebates to homeowners and businesses that have energy storage systems, such as solar batteries.
|Solar on Multifamily Affordable Housing (SOMAH)
|Low-income residents in San Francisco may qualify for the SOMAH Program, which offers financial incentives for going solar. Tenants can slash costs on electricity bills, and homeowners can install solar at a reduced rate.
Installation factors to keep in mind
Before you contact a solar installer, sit down and get your head around all the factors that will impact your solar panel installation. These include:
- Available companies in your area.
- Federal, state and local incentives and tax credits.
- Current net metering programs.
- Sunlight and tree cover.
- Estimated amount of sunlight during certain seasons and times of the year.
- Energy requirements of your home.
- Whether you want to be fully off the grid.
- Pitch of your roof.
- Anticipated maintenance needs.
When reaching out to solar companies, Rosenfeld recommended getting at least three bids. He also suggests looking for reviews on trusted customer review sites, and asking your neighbors who have solar installed for recommendations.
Once you’ve made a list of installers you want to contact, Rosenfeld suggested looking to see if they’re a member of the California Solar and Storage Association and the CA Solar & Storage Association, and if they’re part of the NABCEP (North American Board of Certified Energy Professionals). This indicates the company adheres to industry standards.
How to pay for solar panels in San Francisco
Federal tax incentives, net metering programs and other programs could bump down how much you shell out on going solar in San Francisco. But remember, you can’t install solar for free — that system will still likely cost thousands of dollars. Here are some financing options:
Cash: If you can swing it, paying for a solar system in all cash means steering clear from ongoing loan payments. Plus, you’ll reap the financial benefits of going solar right away.
Solar loan. Solar installation companies frequently partner with financial institutions such as banks and credit unions to offer solar loans. If you don’t have the funds sitting in a bank account to put toward a solar system, this could be a good option. Be sure to look closely at interest rates and terms and shop around.
Home equity loan or a HELOC. Home equity loans and HELOCs tap into your home’s equity to fund home improvement projects or other big expenses. Whereas home equity loans are installment loans where you receive a lump sum upfront, HELOCs are a revolving line of credit. Your home equity backs up both home equity loans and HELOCs. So, if you can’t keep up with payments, you risk losing your home.
Personal loan. Many online lenders and financial institutions offer personal loans. While largely unsecured, they often have higher interest rates and shorter terms. Shop around and get at least several quotes before making a decision.
Solar lease or power purchase agreement. Both a solar lease and power purchase agreement (PPA) mean not having to foot costs to buy a solar system. However, when you lease panels, you need to foot the costs of renting the panels. With a power purchase agreement (PPA), a solar company installs the panels on your home. In turn, you pay for the power that’s being generated.