Palmetto

Texas

Solar Guide
Nathan Healy
Certified by Nathan Healy
Quality Solar Solutions Since 2011
Palmetto has served 20,000+ customers across 31 states with an approval rating over 85%.
01

Solar in Texas

Looking to harness Texas’ abundant sunshine with home solar panels? With electricity prices in Texas rising 28% since 2020, more homeowners are discovering the financial benefits and energy independence that solar provides.

As the Lone Star State climbs to 7th nationally for residential solar installations, now is the perfect time to understand how solar installation works in Texas’ unique energy landscape.

TEXAS by the Numbers

7th Most residential solar in the United States
122k Households have installed solar panels
~$8k Texas average solar rebate savings
~$91k Texas average savings over 25 years
02

Key Takeaways

  • Texas ranks 7th nationally for residential solar with abundant sunshine, rising electricity prices, and incentives making it an ideal state for solar installation.
  • The average solar system in Texas pays for itself in 7 years and saves homeowners approximately $91,345 over the 25-year system lifetime.
  • Texas offers valuable solar incentives including property tax exemptions and the 30% federal tax credit, saving homeowners an average of $8,189.
03

Palmetto Reviews

04

Solar Cost in Texas

Discover the true cost of solar installation in Texas with our calculator powered by real installation data from Houston, Austin, Dallas, and more. Palmetto’s transparent, local insights help you make informed decisions about clean energy for your home.

System Size
Recommended System
9.72 kW
Typical for your home size in TX
This system size is designed to offset approximately 100% of the average electricity usage for a home of this size in Texas.
Cost Breakdown
System Cost
$27,296
Federal Tax Credit (30%)
$-8,189
Final Cost
$19,107
Savings
Monthly Savings
Average utility bill reduction
$208
Payback Period
Break-even point
7.0 years
25-Year Savings
Total financial benefit
$91,345
05

Texas Electricity Prices

Texas utility companies offer varying electricity rates, mostly below the 2023 national average of 16.0¢/kWh. Understanding these costs helps homeowners make informed energy decisions, especially when considering solar alternatives.

Most Texas utilities maintain rates below both state (14.50¢/kWh) and national averages, with Magic Valley Electric offering the lowest at 10.30¢/kWh. Only Xcel Energy exceeds the state average at 14.7¢/kWh.

While Texas electricity rates remain competitive, they’ve increased significantly since 2020. Solar installation provides a fixed-cost alternative that can shield homeowners from future utility rate hikes while leveraging Texas’ abundant sunshine.

Texas Utilities Electricity Rates

El Paso Electric
13.50¢
-16%
Austin Energy
13.00¢
-19%
Bluebonnet Electric
11.10¢
-31%
CPS Energy
12.10¢
-24%
CoServ Electric
12.80¢
-20%
Magic Valley Electric
10.30¢
-36%
PEC
11.70¢
-27%
Tri-County Electric
14.10¢
-12%
Entergy
13.20¢
-17%
SWEPCO
11.90¢
-26%
Xcel Energy
14.70¢
-8%
TX Average
14.50¢
-9%
US Average
16.0¢
06

Texas Solar Incentives

Texas offers significant solar incentives in Texas that make going solar more affordable, including property tax exemptions and potential net metering benefits.

These incentives work alongside the federal solar tax credit to substantially reduce your initial investment. The property tax exemption alone can save homeowners hundreds of dollars annually on a typical system.

Remember that incentive programs can change. Research current offerings and consult with solar experts to maximize your savings potential before making your decision.

Save an average of

$8,189

in solar rebates in Texas

INCENTIVE TYPE DESCRIPTION SOURCE
Residential Clean Energy Credit Federal tax credit A federal tax credit worth 30% the cost of a solar panel system in the year it’s installed Learn More
Property Tax Exemption State tax exemption No property tax increase from solar installations. Example: $20k system saves ~$400/year at 2% tax rate. Learn More

The Residential Clean Energy Credit lets people claim a tax credit worth 30% the cost of a solar panel system in the year it’s installed. The credit can only be used against taxes you owe or have already paid that year, but any excess credit can be rolled over to future years.

The credit is broadly available, though there are a few restrictions — you must own the panels and they must be on a house you live in — so be sure to consult a tax professional about your situation.

Texas offers a valuable Property Tax Exemption for solar and wind-powered energy devices that can significantly reduce your property tax burden. When you install qualifying solar panels or wind energy systems on your property, the added value of these renewable energy systems is exempt from property tax assessments. This means you won’t pay additional property taxes on the value these systems add to your home.

To qualify, you must own a solar or wind-powered energy device that converts energy from the sun or wind into thermal, mechanical, or electrical energy. The exemption applies to both residential and commercial properties. You’ll need to file Form 50-123 (Exemption Application for Solar or Wind-Powered Energy Devices) with your local county appraisal district. While there’s no specific deadline mentioned in the program details, it’s recommended to apply as soon as possible after installation to maximize your tax benefits. This exemption remains in effect as long as you own the qualifying system and the property.

Net Metering and Net Billing in Texas vary significantly depending on your utility provider. These programs allow solar system owners to receive credit for excess electricity their systems produce and send back to the grid. However, unlike states with standardized policies, Texas utilities each set their own rules and compensation rates.

Most Texas utilities offer either Monthly Net Metering or Net Billing (Export Credit). With Monthly Net Metering, excess electricity is typically credited at a 1:1 ratio against your consumption within a billing period. With Net Billing, exported electricity receives a specific credit rate, usually between 3-8 cents per kilowatt-hour. Some providers like Shell Energy recently reduced their export credit from 15 cents to 7 cents per kilowatt-hour starting April 2024.

Important considerations include: monthly settlement is common with most excess credits not rolling over year to year; many utilities forfeit any remaining credits in December without payout; some utilities charge additional monthly fees for solar customers; and compensation rates may change annually based on the utility’s avoided costs. Before installing solar, check with your specific utility provider to understand their current policy, as these can significantly impact your system’s financial performance.

Ready to start saving with solar?

Speak with a Palmetto solar expert to find out exactly how much you can save with Texas incentives.

Get a Free Quote
07

Texas Solar Irradiance

Solar panel production varies throughout the year based on daylight hours, weather patterns, and sun intensity. Texas’ abundant sunshine, seasonal variations, and diverse geography create unique solar production patterns, making it an excellent state for solar panel installations year-round.

What Can the Average Texas Solar System Power?

Summer Production (July)

54 kWh/day

In July, your 10 kW system could power:

  • 3.6 average Texas homes (15 kWh/day per home)
  • or Run central AC for 18 hours AND power all other appliances
  • or Fully charge 5.4 Tesla Model 3 electric vehicles

Winter Production (December)

30 kWh/day

In December, your 10 kW system could power:

  • 2 average Texas homes (15 kWh/day per home)
  • or Keep your home heating system running for 15 hours
  • or Fully charge 3 Tesla Model 3 electric vehicles

Annual Production

14,600 kWh/year

Over a year, your 10 kW system could:

  • Offset 10 tons of carbon dioxide emissions
  • or Equal the environmental benefit of planting 175 trees
  • or Save approximately $4,234 in electricity costs

Want to know exactly how much solar can power your home?

Get a personalized solar analysis based on your actual home, energy usage, and roof characteristics.

Get My Custom Estimate
08

Solar Installations in Texas

Discover how Texas communities are embracing solar energy! We’ve meticulously mapped solar installations across the state to show you just how many of your neighbors have made the switch. Explore our interactive heatmap below to see solar adoption in your area and join the clean energy movement.

09

Leasing Solar Panels

In Texas, Palmetto offers flexible financing options through our LightReach program. Depending on your utility provider, you may qualify for either a solar lease or Power Purchase Agreement (PPA). Most major utilities like Oncor Energy, CenterPoint Energy, and AEP Texas offer PPA options, while many electric cooperatives like Pedernales and Bluebonnet provide lease arrangements.

Unlike traditional ownership, Palmetto’s LightReach program eliminates upfront costs and maintenance responsibilities. We handle everything from design and installation to ongoing maintenance with an all-inclusive price. Your system includes premium black solar panels, high-efficiency inverters, and comprehensive protection with a 90% Production Guarantee.

This worry-free approach gives you immediate energy savings without the responsibilities of ownership. Palmetto maintains the system throughout its lifetime, ensuring optimal performance while you enjoy lower energy bills from day one.

Go solar without the investment

With LightReach, there are no investment costs to recoup, loan payments to manage, or maintenance needs to take on. As soon as your panels are active, your solar savings are too!

Learn More
10

Frequently Asked Questions

Yes, solar makes excellent sense in Texas due to abundant sunshine and high electricity rates. The Lone Star State ranks 7th nationally for residential solar installations, with systems typically paying for themselves in just 7 years.

With generous incentives like the 30% federal tax credit and property tax exemptions, plus protection from rising utility rates (which increased 28% since 2020), Texans can save approximately $91,345 over a system’s 25-year lifetime.

Texas doesn’t have a statewide net metering policy. Instead, compensation for excess solar energy varies by utility provider. Most Texas utilities offer either Monthly Net Metering or Net Billing (Export Credit) programs with rates typically between 3-8 cents per kilowatt-hour.

Important considerations include monthly settlement (most credits don’t roll over year-to-year), credits often forfeited in December without payout, and potential additional monthly fees for solar customers. Check with your specific utility provider before installation as their policies significantly impact your system’s financial performance.

Yes, solar panels typically increase home value in Texas. According to a Zillow study, homes with solar panels sell for approximately 4.1% more than comparable homes without solar.

For the average Texas home valued around $300,000, this represents a potential $12,300 increase in resale value. This appreciation, combined with Texas’ property tax exemption for solar installations, makes solar panels a valuable investment for homeowners considering long-term property value.

In Texas, the average cost of a residential solar system is $27,296 before incentives for a 9.72 kW system. After applying the 30% federal tax credit ($8,189), the final cost drops to approximately $19,107.

This investment typically pays for itself in 7 years and generates about $91,345 in savings over the system’s 25-year lifetime. Local utility rates, roof characteristics, and specific equipment choices will affect your actual costs.

Yes, solar is financially worthwhile in Texas with systems typically paying for themselves in 7 years. The average system saves approximately $91,345 over its 25-year lifetime while protecting homeowners from utility rate increases.

With Texas electricity rates rising 28% since 2020, solar provides stable energy costs while adding approximately 4.1% to home value. The 30% federal tax credit and property tax exemptions further enhance the financial benefits.

As a national company with a strong Texas presence, we’ve completed over 3,810 installations across the state since 2020. Our focus on quality installations and customer satisfaction has made us a trusted choice for Texas homeowners.

We offer some of the best financing options in the industry, making solar accessible to more homeowners. Our extensive install network ensures professional service throughout Texas, from system design to installation and ongoing support.