The U.S has witnessed remarkable solar growth over the past decade with California leading the way. The Golden State is the behemoth of the U.S solar market boasting 19,000 megawatts of installed solar to date, which is almost as much as the other top ten solar producing states combined. San Jose, like much of California, has consistent and strong sunlight totals and in this article we’ll explain why San Jose, California is a great spot for solar power and how San Jose homeowners can maximize their solar savings.
How much do solar panels cost in San Jose?
As of mid-2017, the average price for solar panels in San Jose was $3.61 per watt. Thus, since the typical system size in the U.S. is 5 kilowatts (5,000 watts), the average cost of a solar panel system in San Jose is $18,050 before any rebates or incentives.
Though this price may already look attractive, it’s missing a major incentive that bolsters the economics of solar in the U.S.: the federal tax credit for solar energy systems. The solar ITC signifies a huge price reduction thanks to a hefty 30 percent rebate offered to both residential and commercial markets. Check out this data table that shows the cost of solar at different system sizes with the ITC factored in:
San Jose solar pricing table: average system cost and net savings
| System size | San jose Average solar system cost (after ITC) |
|---|---|
| 3 kW | $7,623 |
| 5 kW | $12,530 |
| 7 kW | $17,640 |
| 10 kW | $24,290 |
| 12 kW | $29.400 |
The above table shows the discounted price for a solar panel system in San Jose after the solar ITC is included. The data draws from real quotes submitted to homeowners on the EnergySage Solar Marketplace over the past year. Keeping in mind the typical system size for a U.S. homeowner is 5 kilowatts (5,000 watts), a solar panel system will cost just under $13,000 in 2017.
California’s net metering and other incentives
Net metering has faced recent legislative battles in California but remains one of the biggest incentives for going solar in the state. Every California solar homeowner is eligible to receive bill credits for their excess solar generation at retail price from his or her utility.
Other incentives in California include the California Solar Initiative which is a cash rebate available to customers of either Pacific Gas and Electric (PG&E), Southern California Edison (SCE) or San Diego Gas and Electric (SDG&E). This program is for low-income homeowners who receive cash back for installing solar panels on their homes. The rebate amounts can be as high as $10,000.
Some local utilities also offer homeowners rebates that can pay anywhere from $0.20 to $1.25 per watt of installed solar capacity. For example, Silicon Valley Power offers a cash rebate for every watt of solar power installed up to 10 kilowatts, and Los Angeles Department of Water and Power offers a rebate of $0.30/W of installed solar power.
How San Jose homeowners can save big with solar
Though San Jose residents will see solar prices in the country continue to decline over the next five years, low prices aren’t necessarily the biggest selling point. When it comes to going solar, the long term ROI and savings from avoided bill payments is often the biggest deciding factor – and the figures can be staggering even in states where utility rates are reasonable.
In 2017, solar quotes received by San Jose homeowners yielded 20-year savings estimates of over $62,241 on average. Checkout the breakdown of average net savings by solar system size:
San Jose net 20-year savings from solar
| System size | Average solar savings over 20 years |
|---|---|
| 3 kW | $30,370 |
| 5 kW | $51,219 |
| 7 kW | $77,029 |
| 10 kW | $107,678 |
| 12 kW | $131,675 |
Three tips for solar shoppers in San Jose
Homeowners who get multiple quotes save 10% or more
As with any big ticket purchase, shopping for a solar panel installation takes a lot of research and consideration, including a thorough review of the companies in your area. A recent report by the U.S. Department of Energy’s National Renewable Energy Laboratory (NREL) recommended that consumers compare as many solar options as possible to avoid paying inflated prices offered by the large installers in the solar industry.
To find the smaller contractors that typically offer lower prices, you’ll need to use an installer network like EnergySage. You can receive free quotes from vetted installers local to you when you register your property on our Solar Marketplace – homeowners who get 3 or more quotes can save thousands on their solar panel installation.
The biggest installers typically don’t offer the best price
The bigger isn’t always better mantra is one of the main reasons we strongly encourage homeowners to consider all of their solar options, not just the brands large enough to pay for the most advertising. A recent report by the U.S. government found that large installers are $2,000 to $5,000 more expensive than small solar companies. If you have offers from some of the big installers in solar, make sure you compare those bids with quotes from local installers to ensure you don’t overpay for solar.
Comparing all your equipment options is just as important
National-scale installers don’t just offer higher prices – they also tend to have fewer solar equipment options, which can have a significant impact on your system’s electricity production. By collecting a diverse array of solar bids, you can compare costs and savings based on the different equipment packages available to you.
There are multiple variables to consider when seeking out the best solar panels on the market. While certain panels will have higher efficiency ratings than others, investing in top-of-the-line solar equipment doesn’t always result in higher savings. The only way to find the “sweet spot” for your property is to evaluate quotes with varying equipment and financing offers.
For any San Jose homeowner in the early stage of shopping for solar that would just like a ballpark estimate for an installation, try our Solar Calculator that offers up front cost and long term savings estimates based on your location and roof type. For those looking to get quotes from local contractors today, check out our quote comparison platform.