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Solar Basics for Business

To install a solar electricity system for your business, you will need to work directly with a solar contractor. They will handle all the permitting as well as the interconnection application process with SMUD and the local building departments.

Step 1: Find out if solar is right for you

Check your electricity usage history. Find out how much electricity your company used in the past 12 months. Log into your account history. See SMUD business electricity rates here.

The bullets below show typical rules-of-thumb for solar systems in Sacramento and savings potential.

  • A 10kW system generates about 16,500kWh per year
  • The hourly electricity generated applied to the average commercial rate will save about $0.11/kWh.
  • Therefore a 10kW system would save an average customer about $1,800/year.
  • The savings can vary depending on the customer's billing rate, the time of day electricity is consumed, and time the solar is generating.
  • A 30% federal tax credit is available through 2016. Depending our your tax situation, you can also reduce your tax exposure by depreciating system costs.

Size it right. PV systems can be sized to offset up to 100% of the customer's annual electricity use. However in some cases, especially with time-of-use rates, it is better to size the system based on your energy cost rather than energy use.

How net metering works. The electricity generated by the PV system will first supply your facility's electricity needs. Any unused electricity will flow into SMUD's grid and will reflect as a credit on the customer's electricity invoice. The customer will be charged for the electricity consumed when the solar is not generating or of insufficient supply.

Step 2: Make your business energy-efficient

Your best savings will always be the energy you don't use. To maximize the benefits of having your own solar power system, make sure the electricity it generates is not lost to energy-inefficiency. Learn more here about saving energy and money, as well as rebates and incentives.

Step 3: Making the purchase

Selecting a contractor. This may be your most important decision in the process. It is best to talk to more than one contractor to compare their price and expertise. A list of solar contractors may be found on the website of the California Solar Initiative.

Assessing costs. Solar equipment costs have declined over the last few years. Installed system costs can be as little as $3/watt (CEC-AC rating) or perhaps even less.

Go solar without buying a system. To learn about leasing a solar power system or about Power Purchase Agreements (PPAs) go here.

Frequently Asked Questions. For more information on solar power, check out these frequently asked questions.

Ask SMUD. For questions or more information about solar electricity for your business, call 916-732-5878, or email

Want solar power for your home?

Find out how SMUD can help you put the sun to work at home. More

For Contractors

The incentive funding limit for SMUD’s SB1 Solar Incentive Program (CSI counterpart) was reached on July 8, 2016.

Contractor Stipends
Residential solar PV systems qualify for a stipend of:

  • $500 per installation.
Commercial solar PV systems qualify for one of the following stipend amounts:
  • 200amp and under - $1,000
  • Over 200amp to 800amp - $3,000
  • Over 800amp to 1600amp - $5,000

PV Production Meter
PV Production meter is required and will be installed for all DG projects within SMUD territory. SMUD will install a PV production meter at no cost to customer or contractor.

PV and all DG applications begin by submitting an Interconnection Application using PowerClerk2.

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