Is Electrification Worth It in California?

$0.30 per kilowatt-hour.

That's what Californians pay for electricity—nearly triple the national average. So you'd think electrification would be a terrible idea here, right? Wrong. Dead wrong, actually. California's mild climate means your heat pump barely has to work. And those solar incentives? Still some of the best in the country, even after the NEM 3.0 changes gutted the buyback rates.

The math here is weird but it works. High electricity costs hurt, but 300+ sunny days and minimal heating demand more than compensate. If you're replacing an old furnace or thinking about solar anyway, California is still a green light for electrification.

Updated December 2024Data from EIA, DSIRE, NREL
Heat Pump Payback
Not Recommended
With incentives
Annual Savings
$2,177
Full electrification
Available Incentives
$22,250
Federal + state + utility
CO₂ Reduction
12.8 tons
Per year

California Energy Costs

Electricity Rate
$0.285/kWh
Natural Gas Rate
$1.82/therm
Average Electric Bill
$195/month
Average Gas Bill
$72/month
Climate Zone
mixed
Heating Degree Days
2,600
Cooling Degree Days
1,200

Visual ROI Analysis

Payback Period Comparison

Lower is better • Shortest payback = fastest return on investment

Annual Savings Comparison

Higher is better • More annual savings = greater long-term benefit

Cumulative Net Savings Over Time

Point where line crosses $0 = payback achieved • Steeper line = faster savings growth

Return on Investment by Upgrade

🌡️

Heat Pump HVAC

Upfront Cost$12,000 - $22,000
Total Incentives-$8,500
Net Cost$3,500 - $13,500
Annual Savings$-482/yr
Payback PeriodNot Recommended
Lifetime ROI-41%
CO₂ Reduction2.9 tons/yr
☀️

Solar Panels

Upfront Cost$15,000 - $30,000
Total Incentives-$4,500
Net Cost$10,500 - $21,000
Annual Savings$2,001/yr
Payback Period8.3 years
Lifetime ROI259%
CO₂ Reduction3.3 tons/yr
💧

Heat Pump Water Heater

Upfront Cost$2,500 - $4,500
Total Incentives-$7,750
Net Cost$-5,250 - $-3,250
Annual Savings$119/yr
Payback Period-39.3 years
Lifetime ROI41%
CO₂ Reduction1.8 tons/yr

EV Charger + Electric Vehicle

Upfront Cost$800 - $2,500
Total Incentives-$1,500
Net Cost$-700 - $1,000
Annual Savings$540/yr
Payback Period0.6 years
Lifetime ROI732%
CO₂ Reduction4.8 tons/yr

Full Electrification Package

Total Upfront Cost
$30,300 - $59,000
Total Incentives
-$22,250
Net Cost After Incentives
$8,050 - $36,750
Annual Energy Savings
$2,177/year
Lifetime Savings (18 years)
$39,194
Simple Payback
12.9 years
💡

Best ROI for California

Based on your state's energy costs and climate, EV Charger offers the best return on investment with an average payback of 0.6 years and an ROI of 732%.

0.0 years slower than average compared to the national average.

Ready to electrify your California home?

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