The purpose of this research is to gain insight into the many facets of the solar energy market and to determine if solar energy is market competitive with conventional energy sources. Solar energy, although not a new technology, has struggled in the energy market due to its high costs even with legislative and economical help. California is a good case study due to its history of leadership in environmental policy and its favorable climate for solar energy production. The first part of this thesis analyzes California’s solar energy policies and investments to see what it is currently doing to advance solar energy in the energy market. The second part compares California to countries that have better market competitive solar energy and an economic analysis of what can be done to make solar energy market competitive in California. By analyzing this we can determine the steps that need to be taken to make the residential solar energy market competitive with the conventional energy market in California.