State & Local Programs

Texas Solar Panel Cost & Incentives

How much do solar panels cost in Texas? Compare solar panel installation costs across 0 state, utility & local incentive programs. Find solar panels for your home, heat pump rebates, EV charger incentives & more.

Last updated: March 1, 2026

Texas solar quick facts

Data verified March 1, 2026

Key solar metrics for Texas homeowners in 2026.
Average system cost	$2.40–$2.90/watt (below national average)
Average electric bill	$145–$175/month (varies widely by region and REP)
Peak sun hours	4.8–6.5 hours/day (varies by region)
Net metering	No state mandate, varies by REP and municipal utility
Top utility	Oncor (DFW), CenterPoint (Houston), Austin Energy, CPS Energy (SA)
Solar adoption	Top 2–3 nationally for total installed capacity

Federal update: The 30% solar ITC (Section 25D) and home improvement credits (Section 25C) expired Dec 31, 2025. Programs listed below are state, utility, and local programs sourced from Rewiring America.

Programs Available in Texas

0 Programs

No programs found for Texas yet.

Program data sourced live from the Rewiring America API. Utility rates from OpenEI. City solar costs from EnergySage. No data is hardcoded. Run the calculator for your personalised estimate.

Solar Panels for Home in Texas: Overview

Texas is the second-largest solar market in the country by installed capacity, and residential installations have been growing more than 30% per year since 2022. What makes Texas attractive for rooftop solar comes down to a few real things: a lot of sunshine, rising electricity costs on the deregulated ERCOT grid, and an installer market that's competitive enough to keep prices below the national average.

Texas has no state solar rebate and no state solar tax credit. It can't have one, because the state has no income tax. The federal 30% Investment Tax Credit ended for new installations in December 2025 under the One Big Beautiful Bill Act, so homeowners installing in 2026 are relying on the property tax exemption and whatever utility buyback plans they can secure as the primary financial incentives.

The Texas electricity market is deregulated across most of the state (the ERCOT zone). You choose your Retail Electric Provider, and some REPs offer solar buyback plans that credit excess generation. The catch is that buyback rates vary wildly between providers. Picking the right REP is at least as important as picking the right installer, and a lot of the savings live in that decision.

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Texas Solar at a Glance

Avg. System Cost

$2.40–$2.90/watt (below national average)

Peak Sun Hours

4.8–6.5 hours/day (varies by region)

Avg. Electric Bill

$145–$175/month (varies widely by region and REP)

Net Metering

No state mandate, varies by REP and municipal utility

Top Utility

Oncor (DFW), CenterPoint (Houston), Austin Energy, CPS Energy (SA)

Solar Market

Top 2–3 nationally for total installed capacity

How Much Do Solar Panels Cost in Texas?

Texas covers a huge range of climate. West Texas and the Panhandle get 5.5 to 6.5 peak sun hours per day, in the same league as Arizona. The Dallas-Fort Worth metro averages 5.0 to 5.3. Houston and the Gulf Coast come in around 4.8 to 5.0, and Austin and San Antonio land between 5.0 and 5.5. Even the lowest-sun parts of Texas outperform most of the eastern US.

Texas added more utility-scale solar capacity than any other state in 2024, and residential rooftop installations have been on the same kind of growth curve. The big metros (DFW, Austin, Houston, San Antonio) have a competitive installer market that keeps typical pricing in the $2.40 to $2.90 per watt range, below the national average above $3.00.

Three Transmission and Distribution Service Providers cover most of the state's residential customers. Oncor handles DFW, Waco, and parts of West Texas. CenterPoint covers the Houston metro. AEP Texas serves Corpus Christi and parts of South and West Texas. These companies own the poles, wires, and meters, but they don't sell you electricity. That's your REP's job. In the regulated (non-ERCOT) territories, Austin Energy and CPS Energy in San Antonio operate as municipal utilities with their own solar programs that look more traditional.

Is Solar Worth It in Texas? Installation Cost & Savings

Solar is still a strong investment for most Texas homeowners in 2026 even without the federal ITC. The fundamentals work: lots of sunshine, rising electricity costs, and a property tax exemption that compounds in value every year you own the home.

A typical 8 kW system in Texas costs $19,200 to $23,200 before incentives. The property tax exemption is worth $400 to $700 per year on an ongoing basis. Annual electricity savings depend on your REP and your system size, but they typically come in at $1,400 to $2,200. Payback periods land at 10 to 15 years, and the panels themselves carry 25 to 30 year warranties.

Where solar works best in Texas: Austin Energy or CPS Energy territory with structured buyback programs, deregulated areas where you can land a competitive REP solar buyback plan, homes with monthly bills above $180, south-facing roofs in the 5.0+ peak sun hour zones, and homeowners staying for 10+ years. Where returns are slower: REP plans with no buyback at all, low-usage homes under $100 a month, heavily shaded lots, north-facing roofs, and homes that are about to be sold.

After payback, the system generates essentially free electricity for the remaining 15 to 20 years of its warranty. Texas's history of rising and volatile electricity rates (ERCOT wholesale prices have been unstable since Uri) is the hidden case for solar here, because it's basically a long-term hedge against whatever the grid does next.

Net Metering in Texas

Texas has no statewide net metering mandate. How your excess solar generation gets handled depends entirely on your utility territory and your REP.

In the deregulated ERCOT territory, your REP determines the buyback rate for excess solar energy. Some REPs offer "solar buyback" plans with per-kWh credits ranging from $0.04 to $0.12/kWh, which is a wide enough range that shopping carefully on PowerToChoose.org genuinely matters. Other REPs offer no buyback at all, which means any solar you can't use in real time effectively earns you nothing. TXU Energy, Green Mountain Energy, Chariot Energy, and Rhythm Energy have all offered competitive solar buyback plans, but the specific rates change often. The buyback rate is almost always lower than your retail rate, so size your system accordingly rather than assuming exports earn full retail credit.

Austin Energy uses a Value of Solar tariff, currently around $0.097/kWh credited for all generation. That isn't traditional net metering, it's a separate credit applied to your bill. The VOS rate is set annually by the Austin City Council and has trended down over recent years.

CPS Energy in San Antonio offers a solar buyback program with per-kWh credits that vary by time of generation and system size. CPS runs one of the more transparent solar programs among Texas utilities, and the documentation is genuinely usable.

If you're in the deregulated market, lock in a favorable REP plan before you connect your solar system. Switching REPs afterward is possible but can involve contract termination fees, and the timing matters more than people expect.

Solar Tax Exemptions in Texas

Texas offers a 100% property tax exemption for the appraised value increase from a solar energy system, codified in Texas Tax Code §11.27. If your solar panels add $20,000 to $30,000 to your home's value, you pay zero additional property tax on that amount. Given Texas's relatively high property tax rates, typically 1.8% to 2.3% of appraised value depending on the county, this exemption saves homeowners $400 to $700 per year. That's meaningful and ongoing.

What Texas doesn't offer: a state income tax credit (Texas has no state income tax to claim it against), a sales tax exemption for solar equipment (the 6.25% state sales tax applies, plus local sales taxes that typically add 1% to 2%), or a state solar rebate program.

Sales tax on solar equipment in Texas adds $1,500 to $2,500 to a typical residential installation. The property tax exemption is the most valuable ongoing state-level benefit, and it doesn't sunset, so you keep capturing it every year you own the home.

Battery Storage Incentives in Texas

Battery storage interest in Texas jumped after Winter Storm Uri in February 2021, when millions of homes lost power for days in below-freezing temperatures. The ERCOT grid's vulnerability to extreme weather, both winter storms and summer heat waves, has made backup power a real priority for a lot of Texas homeowners rather than just a financial calculation.

Popular residential battery options in Texas include the Tesla Powerwall 3, Enphase IQ Battery 5P, and Franklin WH5000. Installed costs run $10,000 to $16,000 depending on capacity and installer. The federal battery credit expired alongside the solar ITC in December 2025, so the full cost is on the homeowner now.

Battery storage makes the most economic sense in a few specific Texas scenarios. Rural areas with extended outage exposure, especially during ice storms or after hurricanes, have a backup-power case that doesn't depend on the rate-arbitrage math. Homeowners on REP plans with time-of-use pricing can use batteries to store cheap off-peak solar and discharge during expensive evening peaks. And on plans with weak or zero buyback rates, batteries let you use more of your own solar directly instead of effectively giving it to the grid.

Austin Energy and CPS Energy customers may also benefit from storage through utility demand management programs that pay for grid support during peak events.

Frequently Asked Questions About Solar in Texas

Does Texas have a state solar tax credit?

No. Texas has no state income tax, so a state solar tax credit isn't possible. The primary state-level incentive is the 100% property tax exemption for solar system value under Tax Code §11.27. The federal 30% solar ITC expired in December 2025 for new installations.

Is net metering available in Texas?

Texas has no statewide net metering law. In the deregulated ERCOT market, your Retail Electric Provider decides whether and how excess solar generation is credited. Austin Energy and CPS Energy (the two big municipal utilities) offer their own buyback programs. Compare REP solar buyback plans on PowerToChoose.org before installing, because the spread between providers is wide.

How much do solar panels cost in Texas in 2026?

Typical residential solar in Texas runs $2.40 to $2.90 per watt, below the national average. An 8 kW system costs roughly $19,200 to $23,200. Without the federal ITC, payback periods are 10 to 15 years depending on your REP plan and electricity usage.

Are solar panels worth it in Texas without the federal tax credit?

For most homeowners, yes. Texas's strong sunshine, the property tax exemption (worth $400 to $700 per year), and rising electricity rates keep solar viable even without the ITC. Homes with high usage and a favorable REP buyback plan see the best returns, with payback periods of 10 to 15 years and essentially free electricity for 15 to 20 years afterward.

What happens to my solar power during a Texas grid outage?

Standard grid-tied solar systems shut down during outages for safety reasons, even if the sun is shining. To keep power during outages, you need a battery storage system (Tesla Powerwall, Enphase, or similar). After Winter Storm Uri, a lot of Texas homeowners added batteries specifically for backup during grid failures rather than for rate arbitrage.

Does my HOA allow solar panels in Texas?

Texas Property Code §202.010 protects homeowners' right to install solar panels. HOAs can set reasonable aesthetic guidelines but cannot effectively prohibit solar installations. Get your HOA's solar policy in writing before starting, but Texas law is on your side.

Reviewed by the Net-Zero USA editorial team

Last reviewed: March 1, 2026

Sources: Texas Tax Code §11.27, Texas Property Code §202.010, ERCOT, Oncor interconnection standards, Austin Energy VOS tariff, CPS Energy solar program, PowerToChoose.org, EIA State Electricity Profiles, SEIA Texas Solar Spotlight, Congress.gov (One Big Beautiful Bill Act)