Molly Ayala
California's electricity rates are among the highest in the country, with an average residential rate of 30 ¢/kWh, 52% higher than the national average. This translates to an average monthly electric bill of $247 for residential customers. To save money, Californians can take advantage of time-of-use rates, which offer lower rates during off-peak hours, or install solar panel systems, which can provide significant long-term savings. For those unable to install solar, subscribing to a community solar farm can save 5-15% on electric bills. Additionally, California offers various assistance programs, such as the California Alternative Rates for Energy (CARE) and Family Electric Rate Assistance (FERA) Programs, which provide monthly discounts for income-qualified utility and CCA customers.
| Characteristics | Values |
|---|---|
| Average electricity rate | 30 ¢/kWh |
| Average monthly consumption | 825 kWh |
| Average monthly bill | $247 |
| Average yearly consumption | 9900 kWh |
| Average yearly bill | $2,964 |
| Expected expenditure over 25 years | $160,200 |
| Average yearly rate increase | 5.9% |
| Expected break-even point for solar investment | 5.92 years |
| Savings from community solar farm subscription | 5-15% |
| Time-of-use rate plan | Lower rates during off-peak hours |
| Tiered rate plan | Charges rates based on overall energy consumption |
| CARE discount | 20-35% monthly discount for income-qualified utility and CCA customers |
| FERA discount | 18% monthly discount for income-qualified utility and CCA customers |
| Medical Baseline Rate Program | Set amount of electricity at the lowest monthly discounted rate for residential customers with qualifying medical conditions |
| Energy Savings Assistance Program (ESA) | No-cost weatherization services for income-qualified renters and homeowners |
| Energy efficiency programs | Residential and commercial programs available to reduce costs |
| Solar power generation (April 2025) | 8,238 thousand megawatt-hours |
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What You'll Learn
California's average electricity rate
California's electricity rates and market dynamics reflect the state's commitment to sustainability, its historical challenges, and its ambitious vision for the future. The average electricity rates in California are 30 cents per kilowatt-hour (kWh) for residential customers, which is 52% higher than the national average of 20 cents per kWh. This means that the average electricity customer in California uses 825 kWh of electricity per month and 9,900 kWh over the course of the year, resulting in an average monthly electric bill of $247.
California's electricity rates vary depending on the time of use and the region. Time-of-use rates are designed to incentivize reduced electricity usage when the cost of generation is high. For example, electricity is more expensive during the afternoon of a hot summer day and cheaper in the middle of the night. The state's diverse geography, climate, and population centres also influence the intricate dynamics of its electricity rates.
California offers various programs to assist residents in managing their electricity costs. The California Alternative Rates for Energy (CARE) and Family Electric Rate Assistance (FERA) programs provide monthly discounts of 20-35% and 18%, respectively, for income-qualified utility and CCA customers. The Medical Baseline Rate Program ensures a set amount of electricity at the lowest monthly discounted rate for residential customers with qualifying medical conditions. Additionally, some electric utilities offer cash assistance and special payment plans to those facing financial hardships.
To reduce electricity costs, California encourages the use of solar panel systems and community solar farms, which can lead to significant savings over time. The state also offers energy efficiency programs, such as the Mobilehome Park Utility Conversion Program, which upgrades gas and electrical systems and provides individual meters to reduce upgrade costs. California has made notable strides in incorporating renewable energy sources into its energy mix, reflecting its commitment to sustainability.
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Discounted rates for low-income households
California offers discounted rates for low-income households through the California Alternate Rates for Energy (CARE) and Family Electric Rate Assistance (FERA) programs. The CARE program offers a monthly discount of 20-35% on electric bills for income-qualified utility and CCA customers. Electrical companies with more than 100,000 customers in California offer a 30-35% discount, while those with fewer customers offer a 20% discount. The FERA program provides a monthly discount of 18% on electric bills for income-qualified utility and CCA customers.
To qualify for these programs, households must meet certain income criteria, which may be adjusted annually based on inflation. The size of the household and the total current income of all household members are considered when determining eligibility. Additionally, customers enrolled in public assistance programs, such as the Low-Income Oversight Board (LIOB), may also be eligible for these discounted rates.
The application process for the CARE and FERA programs is straightforward, and no additional documentation is required. Interested individuals can contact their utility company, visit their website, or check with community agencies to request an application form and learn more about the programs.
Beyond the CARE and FERA programs, California offers additional assistance programs for low-income households. The Medical Baseline Rate Program ensures a set amount of electricity at the lowest monthly discounted rate for residential customers with qualifying medical conditions and energy needs. Some electric utilities also offer cash assistance and special payment plans to consumers facing financial hardship. These initiatives help ensure that low-income households have access to essential energy services at affordable rates.
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Solar power and savings
California has some of the highest electricity prices in the US, with an average residential electricity rate of 30 ¢/kWh. This is 52% higher than the national average rate of 20 ¢/kWh. As a result, the average monthly electric bill for residential customers in California is $247/month.
Solar power is a great way to reduce your monthly electric bills. While the upfront costs of solar panels can be high, they will pay off over time. The average California homeowner needs an 8.92 kW solar panel system to cover their electricity needs, which comes out to $20,469 before incentives. After the federal tax credit, this drops by 30%.
There are several ways to finance your solar installation. You can pay with cash, a solar loan, a solar lease, or a power purchase agreement (PPA). Paying with cash will save you the most money over time, but a loan can help you avoid upfront costs. With a solar lease or PPA, a third-party company owns your system and either leases you the solar panels or allows you to purchase the electricity they generate. These options have lower upfront costs, but you will save the least over time and may encounter complications if you want to sell your home.
In California, solar installations are eligible for a 30% federal solar tax credit. This incentive allows you to apply 30% of your solar installation and equipment costs toward your federal tax bill. You can also take advantage of local incentives and rebates to further reduce the cost of solar.
Solar batteries can also help you save money by reducing the amount of electricity you pull from the grid when rates are high. When your solar panels are producing more electricity than you’re consuming, you can use that excess energy to charge your solar battery.
By installing a solar system in California, you can expect to break even on your investment in about 5.92 years, at which point you may eliminate your electric bills. Over 25 years, you can save about $119,507 on electricity costs with a 5 kW system.
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Time-of-use rates and plans
Time-of-use plans can help you save money in two ways. Firstly, you can save by being thoughtful about when you use certain appliances and waiting for off-peak times when cheaper electricity is available. Secondly, you can install a solar battery to reduce the amount of electricity you pull from the grid when rates are high. For example, you can use solar panels to generate excess energy to charge your solar battery when your energy consumption is low.
Time-of-use rates in California currently average 30 ¢/kWh, which is 52% higher than the national average of 20 ¢/kWh. The average monthly electric bill for residential customers in California is $247/month, calculated by multiplying the average monthly consumption of 825 kWh by the average electric rate of 30 ¢/kWh.
To provide an example for context, in North Dakota, the average electricity rate is 10.21 ¢/kWh for homes, while in Hawaii, the average rate is 42.34 ¢/kWh.
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California's electricity rate compared to other states
California has some of the highest electricity rates in the United States. The average residential electricity rate in California is 30 ¢/kWh, which is 52% higher than the national average of 20 ¢/kWh. In comparison, North Dakota has the lowest electricity rates, with an average of 10.21 ¢/kWh for homes. Hawaii has the highest rates, with an average of 42.34 ¢/kWh for residential properties.
California's high electricity prices are mainly due to the state's reliance on costly fossil fuels and a shortage of natural gas pipeline capacity. The state's electricity rates have also been impacted by the slow pace of state approvals, which can result in compressed rate hikes. Additionally, California experiences high electricity prices during the summer months, likely due to increased demand for cooling.
While California has high electricity rates, its total electricity bills may be lower than those in other states with more extreme climates. Californians' electricity bills may also be lower if they use less electricity or reduce their electricity costs by installing solar panels. On average, it takes about 5.92 years to break even on a solar investment in California.
California's solar farms and small-scale solar power systems generated 8,238 thousand megawatt-hours in April 2025, the most of any state in the country. This focus on renewable energy sources is essential as the need for renewable energy grows with the depletion of non-renewable sources such as coal.
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Frequently asked questions
The average electricity rate in California is 30 ¢/kWh, which is 52% higher than the national average.
The average monthly electric bill for residential customers in California is $247/month, calculated by multiplying the average monthly consumption of 825 kWh by the average electric rate of 30 ¢/kWh.
There are several ways to reduce electric bills in California, including:
- Using less electricity by being mindful of energy consumption and running appliances during off-peak hours.
- Installing a solar system or subscribing to a community solar farm to reduce electricity costs.
- Checking for energy efficiency programs offered by local utilities to reduce energy costs.
- Applying for discount programs such as California Alternative Rates for Energy (CARE) or Family Electric Rate Assistance (FERA) if eligible.
California offers several discount programs to help reduce electricity rates for eligible residents:
- California Alternative Rates for Energy (CARE): Offers a monthly discount of 20-35% on electric bills for income-qualified utility and CCA customers.
- Family Electric Rate Assistance (FERA): Provides a monthly discount of 18% on electric bills for income-qualified utility and CCA customers.
- Medical Baseline Rate Program: Ensures a set amount of electricity at the lowest monthly discounted rate for residential customers with qualifying medical conditions and energy needs.
The three largest electricity providers in California are:
- Pacific Gas & Electric (PG&E)
- Southern California Edison (SoCal Edison)
- San Diego Gas & Electric
