Residents in San Jose, CA who request quotes on the EnergySage Marketplace spend an average of $273 monthly on electricity. That adds up to $3,276 per year. A different way to look at it is that a typical San Jose, CA resident uses 912 kWh of electricity per month and 10,944 kWh over the year.
(For what it’s worth: San Jose, CA residents shopping for solar on EnergySage may use more electricity than a typical household.)
The easiest way to compare electricity costs across regions is to look at the electricity rate. In the U.S., residential rates generally range from 11 ¢/kWh all the way up to 34 ¢/kWh.
As of January 2026, the cost of electricity in San Jose, CA is 30 ¢/kilowatt-hour (kWh)—roughly 49% higher than the national average cost. That number is based on real-world electric bills shared with EnergySage over the past 12 months. You can compare that number to the most recent average state electric price reported by the U.S. Energy Information Administration (EIA).
The primary utility company providing transmission and distribution in San Jose is Pacific Gas & Electric (PG&E), an Investor Owned Utility (IOU). Unlike some community-owned utilities in California that operate as nonprofits, PG&E is a privately owned, for-profit company.
For most residential customers in California, electricity services are regulated by the state, meaning you're typically served by the designated utility in your region. However, in San Jose, residents are automatically enrolled in a Community Choice Aggregation (CCA) program. In PG&E’s service area alone, there are 12 CCAs available.
CCAs give you more control over who supplies your electricity plan. You can opt out at any time, but CCAs often offer lower rates than standard utility plans. Regardless of your choice, you'll still receive a single bill that includes charges from both PG&E and your selected CCA, if you choose to participate.
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When you pay your electric bill, you’re not only covering the costs to produce that electricity, but also the costs of running and maintaining the electrical grid, as well as public benefit funds that promote things like renewable energy and energy efficiency.
Electric bill costs are rolled into fixed (monthly customer charges) and variable charges (¢/kWh that you use).
Fixed charges, like the flat fee for having a meter, generally remain the same monthly unless your utility makes a policy update.
Your variable charges will change every month and depend on your electricity rate and how much electricity you use.
Your electric bill's variable charges will include a supply (or generation) charge and a transmission and distribution (or delivery) charge. The supply charge covers the cost of electricity generation, while the transmission and distribution charges cover the cost of delivering it to your home.
In San Jose, you can sign up for variable-rate plans, usually time-of-use (TOU) rates, either with your utility company or a retail energy provider (REP). This means the rate per kWh of electricity changes based on the time of day and season.
How clean is the electricity in California?
While it's hard to pin down a precise estimate, according to the U.S. Energy Information Administration, about 42% of the electricity on California’s utility grid comes from fossil fuels—primarily natural gas—as of August 2025.
An impressive 51% comes from renewable sources. Still, installing a 100% renewable home solar panel system in California will almost always shrink your carbon footprint.
It’s also possible to pay your electricity suppliers a bit more so that most (or even all) of your electricity comes from renewable sources. If you’re unwilling or unable to go solar in California but still want to reduce your carbon footprint, this is a great alternative. It just won’t save you any money in most cases. (Though occasionally it could if it’s through a municipal group-buy program.)
As long as you have a suitable roof, one of the surest ways to save on energy is to go solar—ideally with a vetted contractor offering a competitive price.
Solar panels will reduce or even eliminate your electric bills in the short term and protect you against rising electricity costs in the long run, too. The amount you save depends on how much you spend on electricity now and how much of your electric bill you can offset with solar energy.
Solar panels are a big investment, but San Jose, CA homeowners who install them—and pay upfront—break even after an average of just 5.42 years. Then, the solar panels will continue to produce free electricity for years to come.
Does San Jose offer net metering?
On sunny days, your solar panels will usually produce more than enough electricity to meet your needs. But all that energy doesn’t go to waste.
While California no longer offers statewide net metering, San Jose’s main utility company—Pacific Gas & Electric (PG&E)––offers net billing, which lets you “sell” the surplus energy generated by your home solar system to your utility company, typically at a wholesale rate.
Net billing differs slightly from net metering. With net billing, the value of surplus solar energy is based on what your utility pays for electricity (wholesale rates), not what you pay (retail rates). Because the wholesale value fluctuates with supply and demand, your exact compensation will vary depending on the hour of the day, day of the week, and month you export your energy.
On your monthly bill, you’ll see a fixed charge, plus either a balance for electricity you consumed but didn’t offset or a rollover of export credits.
How much can you save with solar?
The Golden State has some of the highest electricity rates in the country and some of the best incentives. Together, that means big savings if you go solar in San Jose, CA.
Just take a look at how much you'll spend on electricity over time based on your current bill. It’s easy to see how going solar can pay off quickly.
Electricity cost over time in California
Current monthly electric bill | 10-year electricity cost | 20-year electricity cost | 30-year electricity cost |
|---|---|---|---|
$50 | $8,300 | $25,000 | $58,000 |
$100 | $17,000 | $50,000 | $120,000 |
$150 | $25,000 | $75,000 | $170,000 |
$200 | $33,000 | $99,000 | $230,000 |
$250 | $42,000 | $120,000 | $290,000 |
Assuming a 7% annual increase based on inflation and average annual electric rate increases in California.
Let's assume you pay $273 for electricity monthly (the San Jose, CA average) and that electricity prices increase by 7% annually. Let's also assume you buy your solar panel system upfront and that it costs you $14,000 before any available incentives.
In the first year with solar, you'll avoid spending $3,300 on electric bills. Over five years, you'll avoid $18,900; by 10 years, you'll have avoided $45,400. Solar panels are usually covered under warranty for 25 years—by then, you'll have avoided spending $210,000 on electric bills in San Jose, CA.
The average payback period in San Jose, CA is 5.42 years, so by this point, you've already broken even on your investment. When you subtract your upfront installation cost, you'll pocket $196,000 over 25 years with solar.
Your solar savings depend on you
How much your utility company charges for electricity is a big indicator of how much you'll save with solar. But your exact solar savings depend on your unique situation—including your energy usage, roof layout, system size, and how you pay for your system.
Here are some reasons your savings could be below average:
You don’t use much electricity, or your roof is small or has a less-than-ideal layout. You might have a relatively long payback period, so you'll save a little less over time.
You don't install enough solar panels to 100% offset your energy use. You’ll pay less up front but save less in the long run.
You finance your solar panel system with a loan or sign a lease or power purchase agreement (PPA) instead of paying up front. These types of arrangements can make a lot of sense for keeping your capital flexible and will allow you to start saving sooner. But they will cut into your long-term savings.
Choosing a high-quality solar installer is the key to getting a top-notch solar panel system that will help you save on electric bills.
We pre-screen all solar companies on EnergySage to ensure they get the job done right. Here are the highest-rated EnergySage installers in San Jose, CA:
Elite+ InstallerScreened & Verified5.0 /5.0500 Reviews
Elite+ InstallerScreened & Verified4.8 /5.0850 Reviews
Elite+ InstallerScreened & Verified4.8 /5.058 Reviews
Elite+ InstallerScreened & Verified4.8 /5.0452 Reviews
Elite+ InstallerScreened & Verified4.7 /5.0764 Reviews
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