Solar resource
Your solar production in Sacramento
5.28 avg peak sun hours/day
Monthly avg solar radiation (kWh/m²/day) — Sacramento, CA. Bars update to show estimated kWh production when you use the calculator above.
Utility rate
Sacramento Municipal Utility District (SMUD) electricity rate
$0.175/kWh residential
- Utility
- Sacramento Municipal Utility District (SMUD)
- Residential rate
- $0.175/kWh (blended)
SMUD is a municipal utility (not regulated by the CPUC) and operates its own Net Energy Metering program. Under SMUD NEM, excess solar exported to the grid is credited at a flat export rate rather than the CPUC NEM 3.0 Avoided Cost Calculator rate that PG&E, SCE, and SDG&E customers face. SMUD's flat export rate (approximately $0.065–$0.085/kWh in 2024) is lower than the old retail rate but significantly more predictable and more favorable than CPUC NEM 3.0's time-varying export rates. Sacramento homeowners should size systems for high self-consumption, which is credited at the full retail rate offset.
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Incentives
Available solar incentives in Sacramento, CA
Federal + state + utility
| Incentive | Type | Value | Scope |
|---|---|---|---|
| Federal Solar Investment Tax Credit (ITC) | Tax Credit | 30% of system cost | Federal |
| California Property Tax Exclusion for Solar | Exemption | 100% of added assessed value from solar installation | State |
| SMUD Net Energy Metering (NEM) | Net Metering | Flat export credit (~$0.07–$0.085/kWh) for exported solar energy | Utility |
| Self-Generation Incentive Program (SGIP) — Battery Storage | Rebate | $150–$1,000 per kWh of battery capacity (income-qualified tiers higher) | State |
| AB 1236 Expedited Solar Permit Review | Rebate | Streamlined permit processing — 3-business-day target for qualifying systems | State |
Incentive amounts and eligibility rules change. Verify current terms with your installer and a tax professional before installation.
System cost
Cost breakdown (6 kW default)
- Gross system cost
- $17400
- Federal ITC (30%)
- −$5220
- Net system cost
- $12,180
- Installed cost per watt
- $2.9/W
Lawrence Berkeley National Laboratory Tracking the Sun 2024 — California median installed cost for systems 3–10 kW. California costs are above the national median due to permitting, CalGreen inspection requirements, and labor costs.
Payback & long-term value
25-year outlook
- Annual savings (yr 1)
- $1,588
- Simple payback period
- 7.7 years
- 25-year net savings
- $27520
- Assumed annual rate increase
- 2.5%/year
25-year estimate uses flat electricity rate for conservative baseline. Accounting for 2.5% annual rate increases, lifetime savings increase substantially.
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How it works
How solar savings work in Sacramento
- Your panels capture Sacramento's ample inland sunshine Sacramento averages 5.28 peak sun hours per day — more than most U.S. cities and significantly more than coastal California metros like San Francisco (fog-prone) or Seattle. The Central Valley's dry, clear summers make July and August the peak production months, each delivering over 8 sun hours per day. A 6 kW system in Sacramento produces roughly 9,072 kWh per year.
- An inverter converts DC to AC power A string inverter or microinverters convert the DC electricity from your panels into AC electricity your home uses. Modern inverters achieve 96–99% conversion efficiency. In Sacramento's summer heat (regularly 95–105°F), inverters with adequate thermal management ensure consistent output.
- You use solar power instead of buying from SMUD Every kWh your system produces during daylight reduces what you buy from SMUD at ~$0.175/kWh blended. A 6 kW system produces approximately 9,072 kWh/year — saving roughly $1,588 annually at current SMUD rates.
- Excess power flows to SMUD at the flat export rate SMUD credits excess solar exported to the grid at a flat rate (approximately $0.07–$0.085/kWh). Unlike CPUC NEM 3.0 (which applies to PG&E, SCE, SDG&E customers), SMUD's flat export credit is more predictable. Sizing your system for high self-consumption — covering your home's daytime usage first — maximizes savings.
- You claim the 30% federal tax credit In the tax year your system is installed, claim a 30% federal Investment Tax Credit on the full installed cost. On a $17,400 system, that's $5,220 off federal taxes — reducing the net cost to $12,180.
- Your savings grow as SMUD rates increase As SMUD rates rise over time (historically ~2.5%/year), your solar savings compound while your installation cost stays fixed. A 6 kW system in Sacramento nets approximately $27,520 over 25 years after repaying the installation cost.
FAQ
Common solar savings questions for Sacramento, CA
How much can I save with solar in Sacramento?
A 6 kW system in Sacramento produces roughly 9,072 kWh/year and saves approximately $1,588/year at SMUD's current blended rate of $0.175/kWh. After the 30% federal tax credit, the net system cost is about $12,180, with a payback period of around 7.7 years and estimated 25-year net savings of $27,520.
Is Sacramento affected by NEM 3.0?
No. NEM 3.0 was adopted by the California Public Utilities Commission (CPUC) and applies only to customers of the three investor-owned utilities (PG&E, SCE, SDG&E). SMUD is a municipal utility not regulated by CPUC and operates its own NEM program with a flat export credit. Sacramento homeowners avoid the steep export rate cuts that NEM 3.0 imposed on PG&E/SCE/SDG&E customers — a significant advantage when comparing solar economics across California cities.
What is SMUD's solar net metering program?
SMUD's Net Energy Metering program credits excess solar exported to the grid at a flat rate (approximately $0.07–$0.085/kWh in 2024). This is SMUD's own program, separate from the CPUC-regulated NEM 3.0 that applies to investor-owned utilities. SMUD customers must apply for interconnection approval through SMUD before installation. Check current program terms at smud.org.
What is AB 1236 and how does it help Sacramento solar permits?
California AB 1236 (2015) requires cities and counties to implement an expedited permitting process for residential solar systems, with a target of 3 business days for over-the-counter review of compliant systems. Sacramento's Building Division adopted this streamlined process, reducing the time and cost of getting a solar permit compared to many jurisdictions. This makes getting permitted solar in Sacramento faster and cheaper than in some other states.
Does California have a property tax exemption for solar?
Yes. California Revenue & Taxation Code §73 excludes the value added to your home by a solar installation from property tax reassessment, through at least January 1, 2027. A 6 kW system in Sacramento typically adds $15,000–$20,000 to home value; at Sacramento County's effective property tax rate (~1.1%), this saves $165–$220/year in property taxes.
How many solar panels does a Sacramento home need?
A typical Sacramento home using 700–1,000 kWh/month needs a 5–7 kW system — roughly 13–18 panels at 380–400 W each. Summer air conditioning load is high in the Central Valley, so sizing slightly larger than other CA metros is common. Use the calculator above with your average monthly bill to get a tailored estimate.
Sources
Data sources and freshness
- https://pvwatts.nrel.gov/
- https://www.smud.org/en/Rate-Information/Residential-Rates
- https://www.smud.org/en/Going-Green/Solar-Power/Net-Energy-Metering
- https://openei.org/apps/USURDB/
- https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=RTC§ionNum=73
- https://www.selfgenca.com/
- https://emp.lbl.gov/tracking-the-sun
- https://www.energy.gov/eere/solar/homeowners-guide-federal-tax-credit-solar-photovoltaics
- https://dsireusa.org/
- https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201520160AB1236
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Disclaimer: This calculator provides estimates for informational purposes only — not financial or investment advice. Solar savings depend on actual shading, roof orientation, energy usage patterns, rate changes, and equipment performance. Consult a licensed installer and a tax professional before making purchasing decisions. Verify incentive eligibility with official sources. Data last verified 2026-04-19.