Is solar worth it in Texas?

What drives solar payback in Texas

Texas homeowners pay about 15.8¢/kWh, which is 2.6¢ below the national average. A rooftop here generates roughly 1450 kWh per kW each year — better than the typical US figure. On exports, Texas offers partial / below-retail export credit: No statewide net metering, but some retailers offer strong buyback plans — shop the plan.

A worked example

For a Texas home with a $138/month power bill (typical household usage at Texas’s rate):

That nets out to a payback of about 18.8 years — shorter than simply dividing net cost by year-one savings, because power prices climb ~2.5%/yr so your savings grow each year. Year-one savings already reflect Texas’s below-retail export rate (you save full value on the power you use as it’s made, less on what you export), which is why they’re lower than the bill. Assumes 3.00 $/W installed before incentives and a typical 40% self-consumption; your actual cost, roof and usage will differ — adjust the calculator above.

Who supplies your power in Texas

Texas is unusual: about 85% of the state sits in the deregulated ERCOT market, where the wires company that delivers your power (Oncor, CenterPoint, AEP Texas or TNMP) is separate from the retail electricity provider (REP) you actually buy from. The delivery utility doesn't set your solar buyback — your REP does. Outside ERCOT, municipal utilities like Austin Energy and CPS Energy (San Antonio), plus rural co-ops, run their own programs entirely.

What you’re paid for what you export

There is no statewide net metering in Texas, and that's the single most important thing to understand before you buy. What you're paid for exported solar depends entirely on the specific REP plan you choose — they range from a few cents per kWh fixed, to plans pegged to volatile wholesale prices, to a handful of strong "solar buyback" plans that credit near retail. Choosing the right buyback plan is as consequential as choosing the panels, and it's a decision you can change later by switching REP.

Texas incentives & taxes in 2026

Texas has no state income tax, so there's no state solar tax credit — but it does exempt 100% of the home-value increase from your solar system from property tax (file Form 50-123 with your county appraisal district). Note the gap: Texas does not exempt solar equipment from sales tax, so you'll pay the full ~6.25%+ on hardware. Some city utilities and co-ops add their own rebates; check DSIRE.

The 30% federal credit ended on 31 December 2025 and can now only reach a homeowner indirectly through a lease or PPA. Check the current state and utility programs on DSIRE’s Texas list, then type any incentive into the calculator above to see how it shortens your payback.

What solar costs in Texas

Texas has some of the cheapest installs in the country — around $2.20 per watt on average, well below the national figure — thanks to a high-volume, competitive market and light permitting in much of the state.

The honest verdict for Texas

Cheap installs and the property-tax exemption help, but with no net-metering mandate and the federal credit gone, your Texas payback hinges on two things you control: locking in a good REP buyback plan, and using a lot of your own solar — which the brutal summer AC season actually makes easy. Shop the buyback plan as hard as the system.

Driving electric — or heating electric — in Texas?

Your home electricity rate also sets what it costs to charge an EV and whether a heat pump beats a gas furnace. See the Texas EV charging cost and the Texas heat pump vs gas comparison.

Other states

See all 50 states + DC →