Microgeneration using solar photovoltaic (PV) systems is one of the fastest growing applications of solar energy in the United States. Its success has been partly fueled by the availability of net metering by electric utilities. However, with increasing solar PV penetration, the availability of net metering is likely to be capped. Households would then need to rely on distributed storage to capture the full benefits of their installed PV systems. Although studies of these storage systems to assess their benefits to the individual household have been examined in literature, the systemwide benefits have yet to be fully examined. In this study, the utility level benefits of distributed PV systems coupled with electricity storage are quantified. The goal is to provide an estimate of these benefits so that these savings can potentially be translated into incentives to drive more PV investment. An agent-based residential electricity demand model is combined with a stochastic programming unit commitment model to determine these effects. A case study on the basis of the California residential-sector shows that at 10% penetration levels for households with a 4-kW solar PV panel with a 0.5-kW. h battery, the daily systems cost savings per household could be over $5 a day in August. DOI: 10.1061/(ASCE)EY.1943-7897.0000064. (C) 2012 American Society of Civil Engineers.