Solar can still reduce purchases from the grid, but a useful 2026 quote must start with the full installed cost and your actual electricity use. The homeowner federal credit has ended for new expenditures after 2025, and California’s Solar Billing Plan values exported electricity differently from electricity used at home.
Start with the correct federal credit assumption
The IRS’s final 2025 Form 5695 instructions say that residential clean energy credits cannot be claimed for expenditures made after December 31, 2025. For an existing home, the installation completion date determines when the expenditure is treated as made. Prepaying during 2025 does not make an installation completed in 2026 eligible. The IRS’s August 21, 2025 FAQ, questions 1 and 7, confirms the cutoff.
A carryforward from an eligible earlier installation is different: the 2025 instructions allow unused credit to carry into 2026, subject to the form’s tax liability rules. This does not create a credit for a new 2026 installation. Leases, power purchase agreements and business-owned systems involve different ownership and tax arrangements; evaluate the contract separately.
Understand the Solar Billing Plan
The CPUC’s net billing guidance describes the Net Billing Tariff, often called NEM 3.0 or the Solar Billing Plan, for new applications in PG&E, SCE and SDG&E territories. Its import and export prices are separate. Export compensation varies with time and is usually below the retail rate, although some periods can be more valuable. Confirm the rules for your own interconnection date and generation provider.
Using solar while it is produced can avoid some grid purchases. Sending surplus electricity to the grid earns the applicable export credit. Neither action automatically removes fixed charges, all delivery charges or other bill items.
Compare a quote using your own inputs
- Collect usage: use a full year of bills and, when available, interval data. Monthly totals alone cannot show whether production coincides with demand.
- Identify the tariff: record the utility, rate plan, CCA if applicable, fixed charges, export schedule and source effective dates.
- Check the system: ask for roof-specific production, shading, equipment specifications and degradation assumptions.
- Compare all costs: include financing, roof work, maintenance, battery replacement and any verified incentives you personally qualify for.
- Test alternatives: compare no solar, solar only and solar with a battery using the same usage profile.
Estimate savings without promising payback
Compare the modeled annual bill before and after solar, then subtract ongoing system costs. For a cash purchase, simple payback divides net upfront cost by annual net savings; it ignores financing, changing prices and the time value of money. If savings are zero or negative, that calculation has no positive payback. A generic retail rate multiplied by annual production cannot establish your bill savings.
A battery can shift energy to another hour and provide backup if configured to do so. Its purchase cost, usable capacity, losses, operating limits and replacement assumptions belong in the comparison. A battery does not guarantee a better financial result.
Use RateAtlas as a planning check
Start with the California Solar Savings Calculator. Prepare your monthly usage, utility or plan, and proposed system size. Its simplified results depend on the dataset and assumptions shown; they are not a utility bill or an installer guarantee. Use California Compare Plans to explore rate-plan costs separately, and confirm solar-plan eligibility with the utility.
Source review: October 21, 2026. Tax conclusions use the final 2025 Form 5695 instructions and IRS FS-2025-05 dated August 21, 2025. Net billing structure uses the CPUC guidance linked above. This review does not certify every calculator tariff as current.