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Ultimate 2020 Guide to Solar Power in San Diego, California: Everything you need to know

Updated: Jan 28


Everything you need to know about residential solar, home batteries, SDG&E and solar incentives in San Diego.
Ultimate 2020 Guide to Home Solar and Batteries in San Diego

Solar In San Diego 

Whether it is Balboa Park, the San Diego Zoo, or La Jolla Cove, when people talk about San Diego, they usually focus on the fantastic weather and nature. The ample sun and extremely high electricity rates have made San Diego one of the national leaders in residential solar installations.


San Diego Gas and Electric (SDGE) has long had some of the most expensive rates in California and the nation. Because of this and the high production solar systems get in San Diego county, homeowners can save tremendous amounts of money by switching to solar power and increase the value of their homes. The economic and environmental impact is why so many homeowners have already made the switch to solar. Let's dive into everything a homeowner needs to know before making the switch to solar. 

What utility covers San Diego County?

San Diego County has over 3.3 million people, and all of San Diego County and parts of Southern Orange County are provided electricity by San Diego Gas and Electric (SDGE).

What are SDG&E's electricity rates?

Like most other utilities, SDG&E has many different factors that determine the electricity rates a homeowner will pay. SDG&E has some of the highest rates in the nation, and before going solar, a customer can expect to pay $0.22 and $0.50 per kWh, depending on multiple different factors. SDG&E also has multiple different rate plans depending on if they are on a "Standard Plan" (electricity rates are broken into tiers, the more electricity a homeowner uses the hire amount they pay as they enter different tiers), Time of Usage rate structure, if they own an electric vehicle or if they are a solar customer.


If you are looking for the most up to date breakdown of rates SDG&E website has information for the current residential customers.

Do SDG&E customers have access to a solar program?

Like the other two investor-owned utilities in California Pacific Gas & Electric and Southern California Edison, SDG&E's net metering program is structured based on the California Public Utilities Commission (CPUC) guidelines. Because of the popularity of solar in California and specifically in SDG&E, all customers are now under Net Energy Metering 2.0. 

For homeowners in SD, that means

  1. Credits for exported electricity- Full retail rate

  2. Rate structure- All-NEM 2.0 customers are on Time of Use rate structures

  3. Non-bypassable charges (NBCs)- Customer pays NBCs on all electricity that they utilize during a billing period

  4. System sizing- System cannot be sized greater than a homes electrical needs, but a system can be as large as needed 

  5. Interconnection fee- A one-time payment of $132 for residential customers

Solar customers in SDG&E do see some of the highest rates of saving by switching to solar from anyone in California. Switching over to solar is so beneficial because SDG&E electricity rates are amongst the highest in the state of California. The TOU requirements of NEM 2.0 do mean that system design is especially important to ensure maximum production during the times of day when the solar credits are highest.

How does San Diego Gas & Electric (SDG&E) NEM 2.0 impact solar homeowners and the solar investment
San Diego Gas & Electric (SDG&E) NEM 1.0 Vs. NEM 2.0 Guide

What solar panels should I install in San Diego?

Because San Diego has some of the best sun exposure anywhere in the country, the type of panels that a homeowner should install comes done to needs and preferences. Some homeowners are willing to pay a premium for higher wattage efficiency panels because they have limited roof space or like the warranty. While others are more interested in the most cost-effective option.


Regardless of the exact panel type, it is essential that customers in San Diego make sure they are getting a panel from a Tier 1 company with a strong financial standing. Panels are designed to last for over twenty five years and have no moving parts but it is still important to make sure the company you pick will be able to stand by it’s warranty if something goes wrong.


As a result of San Diego's strong solar industry, panels are readily available, and multiple options can be discussed with an Alchemy Solar Consultant. 

How much energy can I get from solar in San Diego?

Every home has different electrical needs, but the objective of a solar panel installation is to offset a home's entire electrical needs. In San Diego, it is crucial to keep in mind that electrical needs may increase in the future as more homeowners purchase Electric Vehicles.


If a homeowner thinks they will be adding an electric vehicle or other high energy demand product in the near future, make sure this is included in the calculation for sizing the solar system. 

Do solar-battery-storage systems make sense in San Diego?

Under San Diego Gas and Electrics NEM 2.0 requirements, all homeowners who switch to solar power are required to transition to a Time Of Use utility rate structure. This means that SDG&E charges homeowners different amounts for electricity during different times of the day. Because of this, solar battery storage systems present San Diego homeowners with an exciting way to save more money on their utility bills.


With a home battery, homeowners can store solar energy in their battery and use it in the home when pulling electricity from the utility grid would be the most expensive. Solar-Battery systems can save a homeowner money and help them become more energy independent.

Home solar battery systems also provide an additional benefit to San Diego homeowners in the post COVID world. As many of us have shifted to working from home more frequently, the need to always keep the power on has also increased.


Battery systems provide battery backup capabilities that keep a home safe during a power outage and ensure that homeowners can get their work done without interruption.  

What rebates and incentives are there in San Diego for solar?

Solar incentives can come in many different forms, and SDG&E does have NEM 2.0 that helps to improve the economics for homeowners who switch to solar. NEM 2.0 ensures that homeowners receive the full retail rate of any electricity that they export to the grid. This helps homeowners build up credits with the utility they can utilize at night or on cloudy days. 

The most significant incentive in place for the people of San Diego is the Federal Investment Tax Credit or (ITC). The ITC provides homeowners who purchase a solar system with the ability to deduct 26 percent of the full cost of installing a solar energy system from their federal taxes. The ITC is stepping down to 22 percent in 2021 and disappearing completely for homeowners in 2022, so it is important to take advantage of the Tax Credit before it goes away. 


How does the Federal Solar Tax Credit change in the years to come
Federal Solar Tax Credit (ITC) Yearly Step-Down

Homeowners who add a solar-energy-storage system also have access to the Self-Generation Incentive Program (SGIP). The SGIP is a rebate for home battery systems that can offset a few thousand dollars worth of the cost of installing the batteries.

Some solar companies claim that SDG&E has "special solar incentives"; this is not true. It is important to note that SDG&E does not have solar incentives for every homeowner. Additional incentives may be available depending on the financial needs of homeowners.

How long will a solar project take in San Diego?

Solar projects require approvals at a few different points during a project's competition. Like anything that requires approval from the utility or local permitting department, sometimes things can get delayed.


The goal is to get the solar project completed as quickly as possible, and for an average project without any delay or required additional work, between contract signature and installation takes around sixty days on average. 

How long does a solar installation take in San Diego?

Most solar installations take two days. Some small systems can be installed in one day, and larger ones may take a few days. With solar batteries becoming more common, systems that include solar and battery storage may take longer than a solar-only installation. 

If you are a San Diego homeowner interested in learning more about residential solar, schedule a free consultation with Alchemy Solar today.



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