Pacific Gas & Electric, PG&E for short, is the largest electric utility in California and it charges some of the highest residential power prices in the country. That is the single reason rooftop solar pays quickly across its Northern and Central California territory, and it is also why the rules changed. Since April 2023 every new PG&E solar customer is placed on California’s NEM 3.0 Net Billing Tariff, which credits the power you export at a low avoided-cost value instead of the full retail rate, so a battery now does much of the heavy lifting. This guide covers PG&E’s rates, how its net billing actually works, the live production range from the coast to the Central Valley, the California incentives that still apply in 2026, and the honest payback math, then you can check your address in about a minute. Updated for 2026.
PG&E solar in 60 seconds
- PG&E charges some of the highest power prices in the country, which is what makes solar pay. Its average bundled residential rate is about 41.46 cents per kWh as of January 1, 2026 (PG&E rate advisory), against a California average near 30 cents and a U.S. average near 17 cents (EIA, as of January 2026).
- Every new PG&E solar home is on NEM 3.0, the Net Billing Tariff. Exported power is credited at low avoided-cost values, not retail, under CPUC Decision D.22-12-056 (CPUC, effective April 2023).
- A battery is now central to the payback, not a luxury add-on. Because midday exports pay little and PG&E power costs the most from 4 to 9 pm, storing your own solar to use in the evening is where the value sits under NEM 3.0.
- Production runs strong from the coast to the Central Valley. A 6 kW system is modeled at about 9,368 kWh a year in coastal San Francisco and 9,836 kWh a year in Fresno (NREL PVWatts, 2026).
- California incentives still help, but the big battery rebate narrowed. The general-market SGIP battery rebate closed to new applicants at the end of 2025; only income-qualified programs remain, alongside a property-tax exclusion that sunsets January 1, 2027 (California BOE, as of 2026).
- The 30% federal homeowner credit (Section 25D) ended after December 31, 2025 (IRS, as of January 2026), so a PG&E customer who buys solar in 2026 cannot claim it.
Key numbers for a PG&E solar home
- PG&E average bundled residential rate: about 41.46 cents per kWh, as of January 1, 2026 (PG&E).
- California statewide residential average: 30.29 cents per kWh, as of January 2026 (EIA).
- Live 6 kW production range: about 9,368 kWh a year on the coast to 9,836 kWh a year in the Central Valley (NREL PVWatts, 2026).
- Estimated simple payback, cash solar-only system under NEM 3.0: roughly 8 years before income-qualified programs (MySolarFY estimate, see the table below).
- California property-tax exclusion on the added solar value: active, sunsetting January 1, 2027 (California BOE).
Is solar worth it in PG&E territory in 2026?
For most owner-occupied PG&E homes with decent sun, yes. PG&E’s average bundled residential rate is about 41.46 cents per kWh as of January 1, 2026 (PG&E), among the highest in the country, so every kilowatt-hour you make and use on site offsets an expensive one. Our own estimate puts a cash solar-only 6 kW system near an 8-year simple payback under NEM 3.0, and a battery captures more of that value by shifting your midday solar into PG&E’s costly 4 to 9 pm peak. Savings depend on your roof, your usage, and whether you add storage, but PG&E’s high rates are what make its territory a strong solar market. The rest of this page shows the rate math, the net-billing rules, and the payback behind that answer.
Why PG&E’s rates make solar pay across Northern and Central California
Solar pays quickly on a PG&E account because the power it replaces is unusually expensive. PG&E’s average bundled residential rate is about 41.46 cents per kWh as of January 1, 2026 (PG&E rate advisory), well above the California statewide average of 30.29 cents and more than double the U.S. average of 17.45 cents (EIA, as of January 2026). Most homes are billed on a time-of-use plan such as E-TOU-C, where the price climbs during the late-afternoon and evening peak, so the kilowatt-hours you can offset in those hours are the most expensive ones on the grid.
That rate gap is the whole case for going solar in PG&E territory. Every kilowatt-hour your roof makes and you use on site is one you do not buy from PG&E at 40-plus cents. The catch, and the reason this page keeps returning to batteries, is timing: PG&E’s highest prices land roughly 4 to 9 pm, exactly when your panels are winding down for the day. How you capture the midday production you do not use on the spot is what NEM 3.0 changed.
| Residential electricity rate | Approximate rate (cents per kWh) | Source and date |
|---|---|---|
| PG&E average bundled residential (non-CARE) | 41.46 | PG&E rate advisory, Jan 1, 2026 |
| California statewide residential average | 30.29 | EIA, Jan 2026 |
| U.S. residential average | 17.45 | EIA, Jan 2026 |
See what solar and battery programs are available in your PG&E ZIP code
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Which cities and counties does PG&E serve?
PG&E covers most of Northern and Central California, about 70,000 square miles from the Oregon border down to Bakersfield and from the Pacific coast to the Sierra Nevada. It serves roughly 16 million people through about 5.5 million electric accounts (PG&E company profile, as of 2026). That footprint includes major solar markets such as San Jose, Oakland, Fresno, Stockton, Modesto, Santa Rosa, Concord, and much of the Bay Area, Central Coast, and Central Valley. If PG&E is the utility named on your bill and it owns your meter, your solar interconnection and net billing run through PG&E, and the rules on this page apply to you.
Note: not every California city is on PG&E, and it matters for your solar math. The city of Sacramento is served by SMUD, and Los Angeles by LADWP. Both are municipal utilities, not CPUC-regulated, so they set their own net-metering rules and are not on NEM 3.0. A Community Choice Aggregator such as San Jose Clean Energy or MCE supplies the generation on some PG&E bills, but PG&E still delivers the power, owns the meter, and administers net billing, so a CCA does not exempt you from NEM 3.0.
Several of the biggest PG&E cities have their own detailed guides: see solar in San Jose under PG&E and NEM 3.0, solar in San Francisco under PG&E and NEM 3.0, and solar in Fresno in the Central Valley. For the statewide picture that sits behind all of this, start with our California solar and NEM 3.0 hub.
How does NEM 3.0 net billing work with PG&E?
NEM 3.0 is the biggest change to the PG&E solar math, and it is why a new solar owner can still see a real PG&E bill. California moved new solar customers onto the Net Billing Tariff under CPUC Decision D.22-12-056, which applies to PG&E interconnection applications submitted on or after April 15, 2023 (CPUC, as of 2026). Under the old NEM 2.0, exported power earned close to the full retail rate. Under NEM 3.0, PG&E credits your exports at avoided-cost values that are usually a fraction of retail, so simply pushing extra power to the grid at noon no longer covers your evening usage the way it once did.
A battery is what closes that gap on a PG&E account. Because midday exports pay so little and evening power costs so much, storing your own production to run the house through the 4 to 9 pm peak is where the value now is. That is the core reason batteries sit on most new PG&E solar systems, and it is also why an honest PG&E payback estimate has to model solar with and without storage rather than assume the old one-to-one credit. A solar-only system still pencils out at PG&E’s rates, but storage is what captures the value NEM 3.0 shifted into the evening. Homeowners who submitted a complete interconnection application before April 15, 2023 are generally grandfathered on NEM 2.0 for about 20 years, so the near-retail export math still applies to them. For the mechanics in plain English, see how net metering and net billing credit your solar exports.
| Export rule | NEM 2.0 (grandfathered) | NEM 3.0 Net Billing Tariff (new since April 2023) |
|---|---|---|
| Who is on it | Complete interconnection application submitted before April 15, 2023 | New PG&E solar applications submitted on or after April 15, 2023 |
| Value of exported power | Near full retail rate | Low avoided-cost value, a fraction of retail |
| Term | About 20 years from interconnection | Ongoing for new systems |
| What it rewards | Exporting surplus to the grid | Using or storing your own production on site |
PG&E production range: coastal San Francisco to the Central Valley
PG&E’s territory spans very different sun, so the production range matters. Using NREL’s PVWatts model for a 6 kW system, a home near San Francisco (ZIP 94103) is estimated at about 9,368 kWh a year, while a home in Fresno (ZIP 93721) in the sunnier Central Valley is estimated at about 9,836 kWh a year (NREL PVWatts, 2026). Both are strong numbers, and the Central Valley’s edge is modest, roughly 5 percent, because coastal California still gets plenty of clear sun once the summer marine layer burns off.
Your roof is not a ZIP code average, so model your own before you size a system. Pitch, orientation, and shading from trees, hills, or a neighboring building move these figures up or down, and your ideal system size under NEM 3.0 depends more on your evening usage and whether you add a battery than on squeezing out the last kilowatt-hour. Run your exact address on NREL’s free PVWatts calculator, then use the payback table below as a starting frame.
What is the real payback on a PG&E solar system under NEM 3.0?
Here is our own estimate for a representative PG&E home, with and without a battery. The table below is an original MySolarFY calculation, not a figure lifted from another site. It uses a 6 kW system producing about 9,600 kWh a year (the middle of the live PVWatts range above), values on-site use near PG&E’s blended retail rate of about 41 cents per kWh, and values exported power at a low avoided-cost rate near 6 cents per kWh under NEM 3.0. Without a battery we assume about half your production is used on site and half exported; with a 13 kWh battery we assume about 85 percent is used on site. Costs are typical cash prices before any incentives. Treat these as estimates to frame your own quotes, not a guarantee.
| Scenario (6 kW, PG&E territory, NEM 3.0) | Estimated cash cost, before incentives | How your solar is valued | Estimated first-year savings | Estimated simple payback |
|---|---|---|---|---|
| Solar only, no battery | About $18,000 | Roughly half used on site at retail (near 41 cents), half exported at avoided cost (near 6 cents) | About $2,250 | Roughly 8 years |
| Solar plus a 13 kWh battery | About $30,000 | Most solar stored and used on site through the 4 to 9 pm peak, little low-value export | About $3,400 | Roughly 8 to 9 years |
How we derived first-year savings: we assume about 50 percent of production is used on site without a battery, versus about 85 percent with a 13 kWh battery, valuing on-site use near 41 cents per kWh (blended PG&E retail) and exports near 6 cents per kWh (an illustrative NEM 3.0 avoided-cost value). Actual avoided-cost credits vary hour by hour and by season. Production of about 9,600 kWh a year is the midpoint of the coastal-to-Central-Valley PVWatts range, and it assumes a home whose usage the 6 kW system roughly matches, on the order of a $3,500 to $4,000 annual PG&E energy bill at these rates. Real avoided-cost export credits run lower in the shoulder seasons, so treat the 6-cent value as illustrative. Costs are typical cash prices before incentives and vary by installer and equipment.
Notice the payback is close either way, but what you get is not. A battery does not shorten payback dramatically at today’s prices, but it captures far more of your solar’s value under NEM 3.0, shields you from PG&E’s most expensive peak hours, and keeps essential circuits running during a Public Safety Power Shutoff or other outage, which PG&E territory sees more than most. To weigh storage specifically, see our guide to what a home solar battery costs and when it pays off.
Which California solar incentives still apply on a PG&E account in 2026?
California has no state solar income-tax credit, so the incentives that matter on a PG&E account are a property-tax break and a set of income-qualified programs. The state’s active solar energy system exclusion keeps the added home value of a solar system out of a property-tax reassessment, which is worth real money on California home values, but it is scheduled to sunset on January 1, 2027 (California BOE, as of 2026). A system that qualifies before that date keeps the exclusion until the home next changes ownership, so installing ahead of the sunset locks it in. The big battery rebate most people ask about, the Self-Generation Incentive Program, closed its general-market residential track to new applicants at the end of 2025; what remains in 2026 are the income-qualified paths, including the Residential Solar and Storage Equity (RSSE) program that opened statewide for income-qualified households in 2025 (CPUC SGIP, as of 2026).
| Incentive or program | What it does | Status in 2026 |
|---|---|---|
| California active solar property-tax exclusion | Keeps the added home value of a solar system out of a property-tax reassessment | Active, scheduled to sunset January 1, 2027 (BOE) |
| SGIP, general-market battery rebate | Rebated home battery storage for typical residential customers | Closed to new general-market applicants at the end of 2025 (CPUC) |
| SGIP income-qualified and equity battery tracks | Higher battery incentives for income-qualified and high-fire-risk customers | Available to those who qualify (CPUC) |
| Residential Solar and Storage Equity (RSSE) | Solar-plus-battery help for income-qualified households, funded through AB 209 | Active, opened statewide for income-qualified households in 2025 (CPUC) |
| DAC-SASH and income-qualified solar programs | Help lower-income homeowners in qualifying areas afford solar | Available in qualifying tracts (CPUC) |
| California state solar income-tax credit | A state credit against income tax | Does not exist; California has no state solar tax credit (DSIRE) |
Because these programs are set by the state and the CPUC rather than by PG&E, they apply the same way across the territory. We keep the full statewide detail on our California solar and NEM 3.0 hub rather than repeating it in full here.
What the federal tax-credit change means for PG&E customers
The federal homeowner credit is gone, but California’s programs and PG&E’s high rates are not. The 30% federal Residential Clean Energy Credit, Section 25D, ended for systems placed in service after December 31, 2025, under the One Big Beautiful Bill, so a PG&E customer who buys solar with cash or a loan in 2026 cannot claim it (IRS; IRS OBBB FAQ, as of January 2026). You will still see installer pages and AI answers claiming the 30% credit is available; the accurate answer for 2026 is that the homeowner version already ended.
One federal exception exists, and it is not yours to claim. A separate commercial credit, Section 48E, can apply to a leased or PPA system, but the business that owns the panels claims it, not the homeowner (IRS, as of 2026). On a lease or PPA you do not file for a federal credit yourself; the system owner does. 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. For the bigger California picture, our guide to powering a California home with solar the right way puts the pieces together.
How to choose a solar installer in PG&E territory
PG&E territory has one of the deepest solar and storage markets in the country, from local California companies to national brands, which is good for you because it means real competition on price and service. Rather than chasing a “best installer” list, screen any company against objective criteria:
- A valid California Contractors State License Board (CSLB) license, typically a C-46 solar or C-10 electrical classification, which you can verify online.
- NABCEP certification, the industry’s professional standard for PV and storage installers.
- Real experience with PG&E interconnection and permission to operate, so your paperwork and inspection go smoothly.
- Battery and NEM 3.0 experience, since storage sizing is now central to the payback, not an afterthought.
- A clear written workmanship and equipment warranty, and a transparent quote that models your exports at real NEM 3.0 avoided-cost values, not the old retail credit. For a checklist, see how net billing affects what a fair quote should assume.
MySolarFY matches you with licensed installers that serve your PG&E ZIP code so you can compare real local quotes side by side, with no obligation.
Check which solar and battery programs are available at your address →
Frequently asked questions
Is solar worth it on a PG&E account in 2026? For most owner-occupied PG&E homes with decent sun, yes. PG&E’s average bundled residential rate is about 41.46 cents per kWh as of January 1, 2026 (PG&E), among the highest in the country, so every kilowatt-hour you make and use on site offsets an expensive one. Our estimate puts a cash solar-only system near an 8-year simple payback under NEM 3.0. Savings are not guaranteed and depend on your roof, your usage, whether you add a battery, and how you pay, but PG&E’s high rates are what make its territory a strong solar market.
Do you still pay PG&E if you have solar? Yes, almost always. With solar you remain a PG&E customer, keep your grid connection, and still receive a monthly bill that includes fixed charges and any grid power you use beyond what your system offsets. Under NEM 3.0 your exported power is credited at low avoided-cost values rather than the retail rate, so a solar-only home can still owe PG&E during the expensive 4 to 9 pm peak (CPUC, as of 2026). Sizing your system to your usage and adding a battery are how you shrink that remaining bill, which is why so many PG&E solar homes now pair panels with storage.
Does NEM 3.0 apply to PG&E? Yes. PG&E is a CPUC-regulated investor-owned utility, so every solar interconnection submitted on or after April 15, 2023 is placed on the NEM 3.0 Net Billing Tariff under CPUC Decision D.22-12-056 (CPUC, as of 2026). Exports are credited at low avoided-cost values instead of the retail rate. Homes interconnected before that date are generally grandfathered on NEM 2.0 for about 20 years. Municipal utilities such as SMUD in Sacramento and LADWP in Los Angeles are not CPUC-regulated and are not on NEM 3.0.
How does PG&E’s solar buyback work now? Under NEM 3.0, PG&E does not pay you the retail rate for power you export. Instead it credits exports at avoided-cost values that change hour by hour and season by season and are usually a fraction of the roughly 41-cent retail rate (CPUC, as of 2026). That is why storing your midday solar in a battery and using it during the expensive 4 to 9 pm peak is now worth more than exporting it. Sizing a system to your own evening usage, rather than to maximize exports, is the NEM 3.0 way to think about it.
What happened to the federal solar tax credit for PG&E customers? The 30% federal Residential Clean Energy Credit (Section 25D) ended for systems placed in service after December 31, 2025, under the One Big Beautiful Bill, so a PG&E customer who buys solar in 2026 with cash or a loan cannot claim it (IRS, as of January 2026). You will still see installer pages and AI answers implying it is available, but the homeowner version already ended. A separate commercial credit, Section 48E, can apply to a leased or PPA system, but the company that owns the system claims it, not you. California’s property-tax exclusion and income-qualified programs were not affected by the federal change.
Do I need a battery to make solar work with PG&E? Not strictly, but it changes the value. A solar-only system still pays off at PG&E’s high rates, roughly an 8-year payback in our estimate, because you offset expensive daytime and shoulder-hour usage directly. A battery captures the midday production you would otherwise export at a low avoided-cost rate and lets you use it during the 4 to 9 pm peak, which is where NEM 3.0 concentrates the value, and it adds backup during outages. Our estimate shows a similar payback with storage but far more of your solar’s value retained. See our home battery cost guide to weigh it.
Does a Community Choice Aggregator like San Jose Clean Energy change my net billing? No. A CCA such as San Jose Clean Energy, CleanPowerSF, or MCE supplies the generation portion of your bill, but PG&E still delivers the power, owns the meter, runs the interconnection, and administers NEM 3.0 net billing. Being a CCA customer does not exempt you from the Net Billing Tariff, and your export credits work the same as any other PG&E-territory home (CPUC, as of 2026). The city-level detail lives on our San Jose solar guide.
Reviewed by the SolarFY Editor, July 2026. Figures were verified against the linked PG&E, EIA, CPUC, California BOE, DSIRE, and IRS sources in July 2026; PG&E rates, NEM 3.0 avoided-cost export values, SGIP funding, and the property-tax exclusion sunset can change, so confirm current terms with PG&E and the CPUC before you decide. Learn more about the SolarFY editorial team and our data and methodology. MySolarFY does not provide tax or financial advice; consult a licensed professional about your own situation.
MySolarFY is a free service that matches homeowners with licensed solar installers. We are not an installer, financing company, tax advisor, 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 tax benefits and any incentives 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.