Solar Panel Costs and Savings in Texas (2026 Guide)
Texas solar in 2026 is a shopping exercise: with no statewide net metering and a deregulated market, the retail electricity plan you pick can swing your savings as much as the hardware you buy.
Texas solar at a glance (July 2026)
| Metric | Figure |
|---|---|
| Avg. residential electricity rate | 16.99¢/kWh (EIA, April 2026) |
| Avg. peak sun hours | ~5.3 per day (NREL-based estimate) |
| Typical installed cost | ~$2.40–$3.35 per watt before incentives (2026 national range) |
| Export compensation | No mandate — REP buyback plans range ~3¢/kWh to retail-match |
| Federal tax credit | None for purchases after Dec 31, 2025 (details) |
| Headline state incentive | 100% property tax exemption (Tax Code §11.27, Form 50-123) |
Your buyback plan is half the deal
About 85% of Texas is deregulated: you choose a retail electricity provider (REP), and each REP sets its own solar buyback terms. In 2026 those range from roughly 3¢/kWh on plans not designed for solar customers up to retail-match plans that credit exports one-to-one. On a system exporting a few thousand kWh a year, the difference between those two plans is hundreds of dollars annually — every year.
Practical rule: before signing an installation contract, price out at least two or three solar buyback plans available at your address, and re-shop the plan when its term ends. Our net metering guide explains the concepts these plans are built on.
The property tax exemption is real money
Texas has no state income tax (so no state credit), but Tax Code Section 11.27 exempts 100% of the value your solar system adds to your home from property tax. In a state with some of the country’s highest property tax rates, this compounds meaningfully over a system’s life. It is not automatic: file Form 50-123 with your county appraisal district, generally by April 30.
Local utilities add more: Austin Energy has offered a $2,500 rebate, Oncor has offered large battery incentives, and various municipal utilities and co-ops run their own programs — worth a check even outside the big metros.
ERCOT, outages, and batteries
Texas runs its own grid (ERCOT), and after the high-profile reliability events of recent years, many buyers treat battery storage as outage insurance first and arbitrage second. A battery also pairs naturally with time-of-use buyback plans — storing midday production to avoid expensive evening grid power.
Strong sun, big loads
At ~5.3 peak sun hours (higher in West Texas), production is strong, and Texas homes’ heavy summer cooling means plenty of daytime load for panels to serve directly. Size to your usage with our sizing guide and run the numbers in the calculator.
Bottom line
With the federal credit gone, Texas solar economics in 2026 rest on three things you control: a well-priced installation, the right buyback plan, and filing Form 50-123 for your property tax exemption. Get all three right and the case is solid; ignore the buyback plan and you can lose a third of your projected savings without touching the hardware.
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Frequently Asked Questions
- Does Texas have net metering?
- No statewide mandate. In the deregulated market covering roughly 85% of the state, export compensation depends entirely on which retail electricity provider and plan you choose — solar buyback plans range from about 3 cents per kWh up to plans that match the retail rate. Comparing buyback plans is as important as comparing installer quotes in Texas.
- What is the Texas solar property tax exemption worth?
- Under Texas Tax Code Section 11.27, 100% of the value a solar system adds to your home is exempt from property tax. If your system adds $20,000 in appraised value, you pay no additional property tax on it. You must file Form 50-123 with your county appraisal district — typically by April 30 — to claim it.
- Are there any solar rebates left in Texas in 2026?
- Yes, but they're local, not statewide. Austin Energy has offered a $2,500 solar rebate, Oncor has offered substantial incentives for battery storage, and other municipal utilities and co-ops run their own programs. Availability changes, so check your specific utility. There is no state tax credit (Texas has no income tax) and the federal residential credit ended December 31, 2025.