When is solar worth it in Texas?
Solar pays best when most of these are true. The more boxes you check, the better your odds.
- 1Open NREL’s free PVWatts calculator
It’s run by the National Renewable Energy Laboratory, a federal lab. Oncor uses it to set its solar incentives. Open PVWatts.
- 2Enter your address and system size
Use the size from your quote, and set the direction your roof faces.
- 3Bring the yearly kWh back here
Type it into the payback calculator below to see your real payback.
Why does solar take longer to pay off in 2026?
The 30% federal credit paid for almost a third of a system. The IRS says it isn't available for property placed in service after December 31, 2025.
An example only. Bars start at zero. Your payback depends on your price, usage, roof and buyback plan.
Texas homes paid about $3.27 a watt in 2025, Austin Energy’s records show, so a typical 8 kW system runs about $26,000. Some utilities still help: Austin Energy pays a $4,000 rebate, and Oncor’s 2026 program pays installers, with or without a battery. See what solar costs in Texas and every incentive in Texas solar incentives.
How much does each solar kWh save me?
It depends on where the power goes. Power you use at home saves your full price. Extra power sent to the grid earns whatever your buyback plan pays.
Bars start at zero. 15.88¢ is the Texas average price (EIA, July 2026). AEP Texas warns that some electric companies pay nothing for extra solar power, so check a plan’s fact label first.
Bars start at zero. Example: 12,000 kWh a year, 60% used at home, the 15.88¢ Texas average price (EIA) and $3.27 a watt (Austin Energy, 2025). Try your own numbers below.
That's why the buyback plan matters so much in Texas. Compare plans in our solar buyback plans guide, and check what a fair price per kWh is. Not sure you can pick a plan? Use our utility finder.
Be careful with big lifetime-savings claims in ads. They depend on guesses about your price, your buyback plan and future rates, so run your own numbers below. A battery can also store midday power for the evening; see is a home battery worth it?
Will solar pay off for my Texas home?
Use the numbers from a real quote if you have one. The starting numbers are examples. No 30% credit is applied, because it's gone for 2026 installs.
Cost: $26,160. Yearly savings: about $1,383. Over 25 years: about $8,400 ahead.
Production comes from your quote. Savings assume today's prices with no rate increases, no panel wear and no loan costs. Not financial advice.
Should I buy, finance or lease solar?
How you pay changes the math as much as the panels do.
Cash usually saves the most over time. Loans add interest, and some loan quotes hide a dealer fee in the price, so ask for the cash price too.
No upfront cost, but you pay for 20 years or more, often with yearly price increases. See the catch with free solar.
What does the new Texas solar sales law do?
Senate Bill 1036 took effect September 1, 2025. It covers solar sales and leases, and it gives you real protection.
- 15 business days to cancel
Every solar contract must let you cancel within five business days, with no penalty.
- 2Your loan cancels too
If you cancel the contract, a third-party lender must cancel the loan.
- 3Sellers must register
Solar retailers and salespeople must register with TDLR starting September 1, 2026.
- 4Real penalties
Fines can reach $10,000 per violation, and up to $100,000 for repeat offenses against seniors.
What should I ask before I sign a solar contract?
Five questions that catch most bad deals.
- 1"What's the price per watt?"
Total price divided by system watts. Austin homes averaged $3.27 in 2025. Under $3 is strong; over $4, ask why.
- 2"How much will it produce?"
Ask for the yearly kWh estimate and a shade report for your roof.
- 3"What buyback rate did you assume?"
Savings that assume a 1:1 plan won't hold on a low buyback plan.
- 4"Does my roof need work first?"
Removing and reinstalling panels later costs extra. See roof costs.
- 5"Are you registered with TDLR?"
Registration is required starting September 1, 2026. See how to vet a Texas solar company.
Is solar worth it? Questions, answered
Is solar worth it in Texas in 2026?
It can be, especially for homes with big bills, sunny roofs with years of life left, and a good buyback plan. With the 30% federal credit gone for 2026 installs, payback takes longer, so run your own numbers with a real quote before you sign.
How long does solar take to pay off in Texas?
It varies a lot. In our example, a $26,000 system saving $1,800 a year pays off in about 14.4 years without the credit, compared with 10.1 years when the 30% credit applied. Your price, usage and buyback plan change the answer.
Does Texas have net metering?
Not statewide. In deregulated areas, each electric company sets its own buyback terms. Some credit extra solar power at the same rate you pay, others pay a few cents, and AEP Texas warns some pay nothing. City utilities like Austin Energy and co-ops have their own rules.
Is there still a solar tax credit in 2026?
Not a federal one for homeowners. The IRS says the 30% Residential Clean Energy Credit isn't available for systems placed in service after December 31, 2025. Texas has no state income tax, so there's no state credit either.
Can I cancel a solar contract in Texas?
Yes. Since September 1, 2025, Texas law requires every residential solar sales or lease contract to let you cancel within five business days without penalty. If you cancel, a third-party lender must cancel the loan too.
Does solar raise my property taxes in Texas?
No. Texas Tax Code section 11.27 exempts the value a solar system adds to your home from property tax. File the exemption on Form 50-123 with your county appraisal district.
Is it better to buy or lease solar?
Buying with cash usually saves the most over time, and a loan works if the rate is low. Leases and power purchase agreements cost nothing up front, but you pay for 20 years or more, often with yearly increases, and you don't own the panels.
Will solar get rid of my electric bill?
Usually not completely. You'll still buy power at night and on cloudy days, and you'll still pay your utility's delivery charges. Solar shrinks the bill; a good buyback plan helps shrink it more.
Do solar panels work during a Texas power outage?
Not by themselves. For safety, most grid-tied systems shut off when the grid goes down. To keep power during an outage, you need a battery. See whether a home battery is worth it and what to do when the power goes out.
Should I wait for solar prices to drop?
There's no guarantee they will. Judge each quote on today's price per watt, your electricity price and your roof's condition. If the numbers work now, waiting means paying full price for power in the meantime.
Sources and updates
Sources (14)
- Internal Revenue Service, Residential Clean Energy Credit: not available for property placed in service after December 31, 2025.
- Texas Department of Licensing and Regulation, Residential solar retail sales now regulated by TDLR (September 3, 2025): the five-business-day right to cancel under SB 1036, and where to file complaints.
- Texas Department of Licensing and Regulation, Residential Solar Retailers at a glance: covered sales and leases, and registration beginning September 1, 2026.
- Texas Legislature, SB 1036, 89th Legislature: the solar sales law, including the right to cancel, lender cancellation and penalties.
- Austin Energy, Austin Energy Solar Programs (October 20, 2025): a 2025 residential average of $3.27 a watt without storage.
- Lawrence Berkeley National Laboratory, U.S. Distributed Solar and Storage, 2026 Data Update: 2025 home system sizes and prices nationwide.
- U.S. Energy Information Administration, Electric Power Monthly, Table 5.6.A: the Texas average residential price of 15.88¢ per kWh, July 2026.
- AEP Texas, Solar energy: electric companies set buyback terms, some pay nothing, and most solar panels shut off during an outage.
- National Renewable Energy Laboratory, PVWatts Calculator: estimates the yearly output of a solar system at any address.
- Oncor, 2026 Solar Program Manual: home options with and without storage, and incentives calculated with PVWatts.
- Austin Energy, Power Up with Sunshine (August 24, 2026): the $4,000 home solar rebate.
- Texas House Research Organization, Solar energy in Texas: Texas ranks first in the nation in solar resource potential, according to the State Energy Conservation Office.
- Texas Legislature, Tax Code, Chapter 11 (Section 11.27): the property tax exemption for solar energy devices.
- Texas Comptroller, Form 50-123: the application for the solar property tax exemption.
Changelog · last updated October 5, 2026 · 1 update
- October 5, 2026: Guide published: when solar pays in Texas without the federal credit, what each solar kWh saves, how the buyback plan changes payback, buy versus lease, the SB 1036 sales law and a 2026 payback calculator.
How to cite this page: The Day Company, "Is solar worth it in Texas in 2026? The honest math", updated October 4, 2026, https://theday.company/tx/is-solar-worth-it.
Payback figures are illustrative and depend on your price, usage, roof, production and buyback plan; this is not financial or tax advice. Prices come from Austin Energy’s 2025 rebate records. Legal details summarize SB 1036 and TDLR guidance. The Day Company is not affiliated with any installer, utility or electric company named here.