With hot Central Valley summers driving up air conditioning use, many homeowners in Davis are looking for ways to manage high PG&E bills. Rooftop solar offers a direct path to lower energy costs, but the strategy for maximizing savings has evolved. Under California's 2026 utility rules, the smartest approach involves using your own solar power on-site, making battery storage a central part of the conversation.
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How Much Do Solar Panels Cost in Davis?
The upfront investment for a solar system in Davis depends on whether you include a home battery, which is now recommended for maximizing financial returns. The costs below are estimates for a typically sized system designed for an average local home.
- Solar Panels Only: A 6.4 kW system has an estimated gross cost of $16,320.
- Solar Panels + Battery: Adding a 10 kWh battery to the 6.4 kW solar system brings the estimated gross cost to $31,320.
These are modeled costs for 2026 and do not include a federal tax credit, as the program for homeowners is no longer in effect. The primary financial returns now come directly from bill savings and state-level benefits.
Incentives & Tax Credits
Key California Solar Incentive: Property Tax Exclusion
While large rebates and federal credits have changed, California continues to support solar adoption with a powerful financial incentive: the property tax exclusion for active solar energy systems.
Normally, a significant home improvement that adds value to your property would also increase your property tax bill. However, with this exclusion, the value added by your solar panel system is exempt from your property tax assessment. This saves you hundreds of dollars each year for the life of the system and is a key benefit for homeowners in Davis and across the state.
Net Metering: Pacific Gas & Electric Co
Net Billing (low export)
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Why Self-Consumption Matters: PG&E's Net Billing Tariff
The reason battery storage is so crucial now is PG&E's Net Billing Tariff (NBT). Under this structure, the value of excess solar energy you send to the grid is far lower than the price of electricity you buy from the grid. You might pay PG&E $0.32/kWh for power in the evening, but they may only credit you around $0.11/kWh for the extra solar power you produce mid-day.
A battery solves this imbalance. It stores your surplus solar energy so you can use it yourself when the sun goes down, instead of selling it cheap and buying it back expensive. This strategy, known as self-consumption, is the most effective way to reduce your electricity costs with solar in 2026.
Projected Savings
Maximizing Your Savings with Solar in Davis
Installing solar panels is an effective way to cut down your monthly payments to PG&E. How much you save depends heavily on your system's design, particularly whether it includes a battery.
- A solar-only system (6.4 kW) is projected to save an average Davis household around $1,970 per year, with an estimated payback period of 7.6 years.
- By adding a 10 kWh battery, the same system can increase annual savings to approximately $2,921. The payback period is about 8.8 years, but the system generates nearly $1,000 more in savings each year by enabling you to use stored solar power during expensive peak hours.
Beyond the immediate bill reduction, an owned solar system helps protect your budget from future PG&E rate hikes. As grid power becomes more expensive, the energy you generate yourself becomes more valuable. Owned panels can also be a useful long-term home-value feature for potential buyers.