2026 · No Federal Tax Credit · NREL + EIA Data
Solar Panels in Texas: Cost, Payback & ROI (2026)
Is solar still worth it in Texas after the 30% federal tax credit expired? These pre-computed estimates use NREL PVWatts production data and current 14.2¢/kWh Texas electricity rates for a typical home using 900 kWh/month.
Section 25D (30% federal solar tax credit) expired December 31, 2025
All numbers below reflect 2026 math with no federal residential credit. State incentives, where applicable, are noted in the section below.
Texas Solar at a Glance
Based on a 900 kWh/month home ($128/mo electric bill at 14.2¢/kWh), 100% offset, no state rebate applied.
6.5 kW
For 900 kWh/month home
$19,309
At $2.95/W (LBNL 2024 avg)
11.3 years
Without state rebate
$1,534
Estimated annual savings
$49,043
Cumulative before rebate
$29,734
Savings minus system cost
14.2¢/kWh
near average vs. 16.0¢ U.S. avg · EIA 2025
1,650 kWh/kW/yr
strong · 5.1 peak sun hrs/day · NREL PVWatts
Is Solar Worth It in Texas in 2026?
Texas has an outstanding solar resource (1,650 kWh/kW/year) and moderate electricity rates of 14.2¢/kWh, which create solid but not exceptional economics. Unlike most states, Texas has no state solar income tax credit or statewide rebate program. However, several utilities offer their own incentives: Austin Energy provides a $2,500 rebate, and CPS Energy (San Antonio) has historically had a rebate program. The ERCOT grid's volatile pricing makes battery storage increasingly attractive.
For a typical Texas home consuming 900 kWh per month, our calculation shows a 6.5 kW system needed for 100% offset. At the current national average installed cost of $2.95/W (LBNL Tracking the Sun 2024), that's $19,309 gross before any state rebates. Year-one savings of $1,534 grow each year as electricity rates escalate — the model assumes 2.5%/year (EIA AEO 2024).
The 11.3 years payback period is moderate — within the national average range of 8–12 years. Over 25 years — the standard warranty period for most premium panels — a Texas homeowner following this profile would save an estimated $49,043 total, for a net benefit of $29,734 after recovering the system cost.
Year-by-Year Savings Snapshot: First 10 Years
Based on 6.5 kW system, 0.5%/yr degradation, 2.5%/yr rate escalation, no state rebate.
| Year | Production (kWh) | Annual Savings | Cumulative |
|---|---|---|---|
| Year 1 | 10,800 | $1,534 | $1,534 |
| Year 2 | 10,746 | $1,564 | $3,098 |
| Year 3 | 10,692 | $1,595 | $4,693 |
| Year 4 | 10,639 | $1,627 | $6,320 |
| Year 5 | 10,586 | $1,659 | $7,979 |
| Year 6 | 10,533 | $1,692 | $9,671 |
| Year 7 | 10,480 | $1,726 | $11,397 |
| Year 8 | 10,428 | $1,760 | $13,157 |
| Year 9 | 10,375 | $1,795 | $14,952 |
| Year 10 | 10,324 | $1,831 | $16,783 |
System cost to recover: $19,309. Table shows savings without state rebate applied. Use the interactive calculator to enter your actual bill and any rebate.
Solar Incentives in Texas (2026)
Texas's main statewide solar benefit is a property tax exemption on the added home value — you pay no additional property tax on the value solar adds to your home.
- Property tax exemption on added home value (statewide)
- Austin Energy rebate ($2,500 for qualifying systems)
- CPS Energy rebate program (San Antonio, check availability)
- Oncor and other utility solar programs (vary by territory)
Incentive programs change frequently. Verify current offerings at dsireusa.org or directly with your utility before making any purchasing decision.
How We Calculate Texas Solar ROI
These estimates use the same methodology as our interactive solar ROI calculator, applied to Texas-specific data:
System cost
$2.95/W installed
LBNL Tracking the Sun 2024
Solar production
1,650 kWh/kW/yr
NREL PVWatts v8
Electricity rate
14.2¢/kWh
EIA Residential Rates 2025
Rate escalation
2.5%/year
EIA Annual Energy Outlook 2024
Panel degradation
0.5%/year
NREL (Jordan & Kurtz, median)
System lifetime
25 years
Standard warranty period
No Section 25D (federal residential solar credit) is included — it expired December 31, 2025. State incentives are not reflected in these pre-computed figures; use the interactive calculator to enter specific rebate amounts.
Calculate With Your Actual Numbers
The figures above use statewide averages. Enter your actual monthly bill, any Texas rebate amounts, and your offset target in our interactive calculator for a personalized estimate.
Frequently Asked Questions — Solar in Texas
Compare Other States
Estimates are based on NREL PVWatts v8 production data, EIA 2025 electricity rates, and LBNL 2024 installed cost benchmarks. Actual savings vary by roof pitch, shading, utility rate structure, and local permit costs. This is not financial advice. Consult a licensed solar installer before making any purchasing decision.