- LADWP is a municipal utility, so it is exempt from California’s NEM 3.0 net billing. Unlike PG&E, SCE and SDG&E, LADWP runs its own traditional net metering and credits your solar exports at the full retail rate within each billing period (DSIRE).
- LADWP is the largest municipal utility in the United States, serving about 1.5 million electric customers (NREL LA100).
- LADWP’s residential rates run well below California’s roughly 35 cents per kWh statewide average (EIA), which keeps bills lower to begin with.
- The 30% federal homeowner credit (Section 25D) ended for expenditures made after December 31, 2025 (IRS).
If the Los Angeles Department of Water and Power, LADWP, is your electric utility, your rooftop solar rules are different from most of California, and the difference works in your favor. LADWP is a city-owned municipal utility, not one of the investor-owned utilities that the California Public Utilities Commission regulates. That single fact is why LADWP is exempt from NEM 3.0, the net billing rules that cut export credits for PG&E, SCE and SDG&E customers. LADWP still runs its own traditional net metering. This page explains how LADWP net metering credits your solar, how its rates compare, and how to connect a system.
LADWP solar and net metering at a glance
LADWP owns the meter, the rates and the interconnection process in its Los Angeles service territory, so the state’s IOU solar rules do not apply here. The table below sums up what that means for a homeowner going solar in 2026.
| Detail | What to know |
|---|---|
| Utility type | Municipal, owned by the City of Los Angeles; the largest municipal utility in the US |
| Customers | About 1.5 million electric customers across Los Angeles (NREL LA100) |
| NEM 3.0 status | Exempt. NEM 3.0 net billing binds the CPUC-regulated IOUs, not municipal utilities |
| Solar crediting | Traditional net metering; exports credited at the full retail rate within the billing period |
| Residential rate | Below California’s roughly 35 cents per kWh average (EIA); verify your exact tiered rate on your bill |
| Source | LADWP solar |
What a typical Los Angeles system produces. According to MySolarFY’s own analysis (August 2026), a typical 7 kW rooftop system in Los Angeles produces about 11,685 kWh a year (NREL PVWatts). At LADWP’s residential rates, which run in the low-to-mid 20-cent range per kWh and well below California’s roughly 35 cents statewide average (EIA), that output would offset roughly $2,400 to $2,900 of grid electricity in a year. Because LADWP rates are tiered and your own number depends on roof, shade and usage, treat this as a planning estimate and get a site-specific figure. Estimate your roof’s likely output with NREL’s free PVWatts calculator.
Why LADWP is exempt from NEM 3.0
NEM 3.0 does not apply to LADWP, because LADWP is a municipal utility and NEM 3.0 only binds California’s investor-owned utilities. The California Public Utilities Commission adopted the NEM 3.0 net billing tariff for PG&E, Southern California Edison and San Diego Gas & Electric, which sharply lowered the credit those customers earn for exported solar and pushed batteries to the center of the math (CPUC net energy metering). LADWP, along with other California municipal utilities like SMUD and Riverside Public Utilities, is governed by its own city charter and board, not the CPUC, so it sets its own solar policy and kept a traditional near-retail net metering structure (DSIRE; NREL LA100). For the mechanics of export credits in general, see how net metering credits your solar exports.
| Solar rules | California IOUs (PG&E, SCE, SDG&E) | LADWP (municipal) |
|---|---|---|
| Regulated by | California Public Utilities Commission | City of Los Angeles charter and board |
| Export credit | NEM 3.0 net billing, credited at a reduced avoided-cost value | Traditional net metering, credited at the full retail rate within the billing period |
| Battery pressure | High; storage is usually needed to make the numbers work | Lower; a battery adds resilience but is not required to earn a fair export credit |
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LADWP rates and what solar offsets
LADWP’s residential electricity rates are among the lower ones in California, which changes the solar math in two ways. Utility-level federal data show LADWP’s average residential price below California’s investor-owned utilities and below the statewide average of roughly 35 cents per kWh (EIA). Lower rates mean your starting bill is smaller, so a system offsets fewer dollars per kWh than it would on a pricey IOU rate. The upside is that LADWP still credits your exports near full retail, so the panels you do install keep their value instead of getting the reduced NEM 3.0 credit. LADWP rates are tiered and change over time, so confirm your exact rate on your bill. To see how bill credits lower your monthly cost, read how solar lowers your electricity bill, and to weigh payback, see the financial case for whether solar panels are worth it.
LADWP solar rebates and incentives
LADWP once paid a residential Solar Incentive Program rebate, but that rooftop rebate is largely wound down, so do not count on it in 2026. LADWP’s Solar Incentive Program delivered roughly $340 million in net energy metering incentives between 1999 and 2021, and current program listings no longer show an active general rebate for typical residential rooftop systems (NREL LA100 Local Solar; DSIRE). LADWP does still run net metering and a Feed-in Tariff aimed mainly at larger projects. Before you plan around any rebate, verify what is currently open directly with LADWP (LADWP solar). The steady value for a homeowner here is the near-retail net metering credit plus LADWP’s lower rates, not a rebate.
What changed federally, and what it means for LADWP customers
The federal homeowner credit is gone, but LADWP’s net metering and rates are not. The 30% federal Residential Clean Energy Credit (Section 25D) ended for expenditures made after December 31, 2025, under the One Big Beautiful Bill Act, so an LADWP customer who buys solar with cash or a loan in 2026 cannot claim it (IRS OBBB FAQ; SEIA). LADWP net metering was not changed by that federal law. A separate commercial credit, Section 48E, is claimed by the business that owns a leased or PPA system, not by the homeowner, so on a lease or PPA you do not file for a federal credit yourself. The 25D homeowner credit, by contrast, ended after December 31, 2025. For the full timeline, see what the federal solar tax credit change means in 2026.
How to connect solar to LADWP
Connecting a home system to LADWP follows a set order, and the key rule is that you cannot turn the system on until LADWP grants permission to operate. The general path is:
- Interconnection and net metering application. You or your installer file an LADWP net metering and interconnection application for your rooftop system.
- Review and agreement. LADWP reviews the application and returns a net metering interconnection agreement to sign.
- Install and inspect. The system is installed and passes City of Los Angeles electrical and building inspection.
- Meter set. LADWP installs or reconfigures a bidirectional net meter that tracks the energy you send back.
- Permission to operate. LADWP issues permission to operate. The system may not run on the grid before this.
A licensed installer normally manages this whole process for you, and the details and fees can change, so confirm the current LADWP net metering and interconnection terms before you commit (LADWP solar). For the questions to ask, see the right questions to ask a solar installer. You can also compare more utilities in our Solar by Utility guides, see the statewide picture in our California solar guide, or read the local overview for solar in Los Angeles.
How to choose a solar installer in LADWP territory
Los Angeles has one of the most active solar markets in the country, so you have plenty of licensed installers to compare. Rather than chasing a “best” list, screen any installer against objective criteria:
- NABCEP certification, the industry’s professional standard for PV installers.
- Proper California licensing (a C-46 solar or C-10 electrical contractor license) and any required City of Los Angeles permits.
- A clear workmanship and equipment warranty in writing.
- Real experience with LADWP net metering and interconnection, so the paperwork and permission to operate go smoothly.
- A written production estimate and a transparent quote that is honest about LADWP’s rates and net metering credit. For a checklist, see the right questions to ask a solar installer.
MySolarFY matches you with licensed installers that serve your area so you can compare real local quotes side by side, with no obligation.
Frequently asked questions
Does LADWP have NEM 3.0?
No. NEM 3.0 net billing was adopted by the California Public Utilities Commission for the state’s investor-owned utilities, PG&E, Southern California Edison and San Diego Gas & Electric. LADWP is a municipal utility governed by the City of Los Angeles, not the CPUC, so it is exempt from NEM 3.0 and runs its own traditional net metering instead (CPUC; DSIRE).
How does LADWP net metering credit my solar?
LADWP credits the energy your panels send back to the grid at the full retail rate within your billing period, rather than the reduced avoided-cost export rate that NEM 3.0 uses for the IOUs (DSIRE). Because the credit follows your retail rate, the solar you export keeps close to its full value. Terms can change, so confirm the current LADWP net metering rules before you commit.
Are LADWP rates lower than PG&E or SCE?
Yes, generally. Federal utility-level data show LADWP’s average residential price below California’s investor-owned utilities and below the statewide average of roughly 35 cents per kWh (EIA). Lower rates mean a lower starting bill, though they also mean each kWh your panels offset is worth a bit less than on a pricier IOU rate. LADWP rates are tiered, so check your own bill.
Does LADWP still offer a solar rebate?
LADWP’s residential Solar Incentive Program rebate paid roughly $340 million in incentives between 1999 and 2021 and is largely wound down, with no active general residential rooftop rebate confirmed for 2026 (NREL LA100). LADWP still runs net metering and a Feed-in Tariff for larger projects. Verify any current rebate directly with LADWP before you plan around it.
What happened to the federal solar tax credit?
The 30% federal Residential Clean Energy Credit (Section 25D) ended for expenditures made after December 31, 2025, under the One Big Beautiful Bill Act. An LADWP customer who buys solar in 2026 with cash or a loan cannot claim it. A separate commercial credit (Section 48E) can apply to leased and PPA systems, but the business that owns the system claims it, not the homeowner. LADWP’s net metering and rates were not affected.
How do I connect solar to LADWP?
You or your installer file an LADWP net metering and interconnection application, LADWP reviews and returns an agreement to sign, the system is installed and passes City of Los Angeles inspection, LADWP sets a bidirectional net meter, and then LADWP issues permission to operate. You cannot turn the system on until you have that permission. A licensed installer usually handles the paperwork, and because terms change, confirm the current LADWP net metering details before you decide.
Reviewed by the MySolarFY team. Figures were verified against the linked LADWP, California Public Utilities Commission, DSIRE, NREL, EIA, and IRS sources as of August 2026. LADWP net metering terms, rebates, rates, and tax rules all change over time, so confirm current terms with LADWP before you decide. MySolarFY does not provide tax or financial advice; consult a licensed professional about your own situation. Learn more about the MySolarFY team and how we work.
MySolarFY is a free service that matches homeowners with licensed solar installers. We are not an installer, financing company, or government program. “No up-front cost” refers to qualifying lease or PPA financing, where eligible homeowners may have no out-of-pocket cost at installation. Lease and PPA terms typically run 20 to 25 years, may include an annual price escalator, and total payments may exceed the cost of a cash purchase; on a lease or PPA the incentives and bill credits often go to the company that owns the system, not the homeowner. Homeowners do not get the federal residential credit that ended after December 31, 2025. Solar panels are not free and monthly payments apply. Eligibility, savings, incentives, and rates vary and are not guaranteed. See our full disclaimer.
