Austin, TX Solar Panels
Solar Power in Austin
Austin homeowners enjoy over 300 sunny days each year—ideal conditions for home solar panels. With Texas electricity prices increasing 28% from 2020 to 2024, understanding solar installation in Austin can help you make informed decisions about your home’s energy future.
This guide covers the essentials of going solar in Austin, from local incentives and installation processes to system sizing and long-term savings potential.
How Much Do Solar Panels Cost in Austin, TX?
Our calculator uses real installation data from Austin homes—including neighborhoods like Cedar Park, Round Rock, Pflugerville, and Georgetown—to show you accurate solar costs. Get personalized estimates based on actual local projects, not generic national averages.
System
Cost
Savings
You can still access the solar tax credit through Palmetto. Talk to us today to find out how.
Key Takeaways
- Austin receives over 300 sunny days annually with 5.4 peak sun hours daily, creating ideal conditions for solar energy production year-round.
- Texas electricity rates increased 23% from 2021 to 2024. Solar panels lock in predictable energy costs, protecting your budget from future rate increases.
- A typical 10 kW system in Austin costs around $27,296 and can save approximately $79,000 over 25 years with a payback period of about 11 years.
Austin Electricity Prices
Understanding electricity costs helps Austin homeowners plan their energy budgets. The data reveals important trends worth considering for your home’s long-term energy strategy.
Texas electricity rates have climbed from 12.1 cents per kilowatt-hour in 2021 to 14.9 cents in 2024—a 23% increase in just three years. Austin homeowners have felt this impact on monthly utility bills.
Solar panels generate electricity at a fixed cost over their 25+ year lifespan, creating a hedge against these rising rates. Your system produces power at the same cost whether grid rates increase or not.
Over two decades, this rate stability can result in substantial savings. While utility rates continue their upward trend, solar-equipped homes maintain predictable energy costs, protecting household budgets from future price increases.
Price of Energy: Texas vs National Average
Austin Area Utility Providers
Austin-area homeowners benefit from electricity rates below both state and national averages. Based on 2023 data, Austin Energy charges 13.0¢ per kWh, while Bluebonnet Electric and Pedernales Electric offer rates of 11.1¢ and 11.7¢ respectively.
These rates fall below Texas’ 2023 average of 14.5¢ per kWh and the national average of 16.0¢ per kWh. Austin’s competitive pricing reflects the region’s diverse energy mix and efficient municipal utility operations.
While current rates remain favorable, electricity costs have risen significantly in recent years. Solar installation allows Austin homeowners to lock in predictable energy costs and reduce dependence on utility rate fluctuations over time.
Austin Utilities Electricity Rates
Texas Solar Incentives
Austin homeowners can reduce solar installation costs through state and local programs. These solar incentives in Texas help make clean energy more accessible.
Texas offers a property tax exemption that prevents your home’s assessed value from increasing due to solar panel installation. Additionally, while Texas lacks statewide net metering laws, most Austin-area utilities credit you for excess energy your system generates at retail rates.
Review the incentives below carefully, as programs can change. Understanding what’s currently available helps you plan your solar investment with confidence and accuracy.
| Incentive | Type | Description | Source |
|---|---|---|---|
| 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 |
Texas offers a property tax exemption for solar and wind-powered energy devices installed on your property. This exemption prevents your local appraisal district from adding the value of your solar energy system to your property’s assessed value for tax purposes. Without this exemption, installing solar panels could increase your property taxes since they add value to your home. With the exemption in place, you won’t pay additional property taxes on the increased value that your solar installation brings to your property.
To qualify for this exemption, you must own the solar energy device and it must be installed on property you own in Texas. You’ll need to apply with your county appraisal district using Form 50-123 (Exemption Application for Solar or Wind-Powered Energy Devices). The general deadline for filing exemption applications is before May 1st. Once approved, this exemption continues as long as you own the property and the solar system remains installed. Since property tax rates and home values vary by county in Texas, the actual dollar amount you save will depend on your local tax rate and the added value your solar system brings to your home. Contact your local county appraisal district for specific guidance on applying for this exemption and to understand your potential savings.
Net metering and net billing policies in Texas vary significantly by utility provider, as the state operates a deregulated electricity market in most areas. Unlike traditional net metering where excess solar energy is credited at full retail rates, most Texas utilities now offer net billing programs that credit exported solar energy at lower wholesale rates, typically ranging from 3 to 8 cents per kilowatt-hour. The specific compensation you receive depends on your local utility or the Retail Energy Provider (REP) you choose in deregulated areas.
In deregulated ERCOT areas served by major transmission companies like Oncor (Dallas), CenterPoint (Houston), AEP Texas, and TNMP, homeowners typically work with REPs like Shell Energy, which offers a buyback plan crediting exports at 7 cents per kilowatt-hour as of April 2024. These credits reduce your current month’s bill, with excess credits rolling over monthly in a “buyback bank” until December, when any remaining credits are forfeited without payout. Shell Energy charges an additional $4.95 monthly fee on top of your transmission company’s delivery charges. Some cooperative utilities like Grayson Collin Electric Cooperative offer more favorable terms with true 1:1 net metering and credits that carry over year to year, while others like CPS Energy (San Antonio) and Austin Energy have unique programs with seasonal rates or “Value of Solar” structures.
Eligibility typically requires installing an approved solar system and enrolling in your utility’s distributed generation program. Important considerations include understanding that most Texas programs settle monthly rather than annually, meaning excess summer production won’t offset winter usage in most cases. Additionally, some utilities charge monthly fees ranging from $10 to $30 for solar customers, and export credit rates can change annually based on wholesale energy costs. Before installing solar, contact your specific utility or REP to understand the exact compensation structure, as policies differ dramatically across the state’s 20+ utilities with solar programs.
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 QuoteAustin Solar Irradiance
Solar panel production varies throughout the year based on daylight hours, weather patterns, and sun intensity. Understanding how seasons affect your solar system helps set realistic expectations for your investment.
Austin’s abundant sunshine and clear skies create excellent solar conditions year-round. While summer heat slightly reduces panel efficiency, high sun angles maximize energy production, making Austin ideal for solar.
Solar Production in Austin by Month
What Can Your Solar System Power?
Summer Production (July)
In July, your 10 kW system could power:
- 3.6 average 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)
In December, your 10 kW system could power:
- 2 average 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
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 EstimateSolar Panel Systems in Austin
We’ve mapped every solar installation across Austin to help you explore which neighborhoods are embracing clean energy. Click any hexagon to see how many homes in that area have made the switch to solar!
Leasing Solar Panels
Austin homeowners served by Austin Energy currently cannot access traditional solar leasing or power purchase agreements (PPAs). However, most surrounding areas in the Austin region have access to Palmetto’s LightReach program, which offers lease options through providers like Pedernales Electric Co-op, Bluebonnet Electric Co-op, and Guadalupe Valley Electric Co-op.
With a solar lease, you pay a fixed monthly amount instead of purchasing the system outright. Your leasing company handles all maintenance, repairs, and system monitoring—removing the burden of upkeep from your shoulders. This means no unexpected costs for equipment failures or performance issues over the life of your system.
Leasing can make solar accessible without the upfront investment required for cash purchases. While you won’t own the system, you’ll still benefit from lower electricity costs and contribute to clean energy. Learn more about whether leasing or buying makes sense for your situation.
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 MoreFrequently Asked Questions
Yes, solar makes strong financial sense in Austin. With over 300 sunny days annually and 5.4 peak sun hours daily, Austin provides excellent conditions for solar energy production year-round.
A typical 10 kW system costs around $27,296 and can save approximately $79,000 over 25 years. With Texas electricity rates rising 23% from 2021 to 2024, solar panels lock in predictable energy costs while protecting your budget from future rate increases.
Austin’s net metering policies depend on your utility provider. Austin Energy uses a “Value of Solar” system that credits all production at $0.0991/kWh while charging retail rates for consumption, with excess credits rolling monthly until December when they’re forfeited.
Surrounding areas like Pedernales Electric Co-op and Bluebonnet Electric Co-op offer net billing, crediting exports at approximately 6 cents/kWh on an instantaneous basis with monthly settlement and no annual true-up.
Yes, solar panels increase home value in Austin. Research from Zillow shows solar panels increase home values by 4.1% on average. For a $400,000 Austin home, that’s approximately $16,400 in added value.
Texas offers a property tax exemption that prevents your assessed value from increasing due to solar installation, so you gain home value without higher property taxes. This combination makes solar a smart investment for Austin homeowners planning to sell in the future.
Solar panel costs in Austin vary by home size. A small home (up to 2,000 sq ft) typically needs a 7 kW system costing around $20,256. Medium homes (2,000-3,000 sq ft) require approximately 10 kW systems at $27,296, while large homes (over 3,000 sq ft) need 13 kW systems costing about $35,795.
These prices reflect actual installation costs in Austin and surrounding areas like Cedar Park and Round Rock. Your final cost depends on your roof size, energy usage, and system specifications.
Yes, solar is financially worthwhile in Austin. A typical 10 kW system costs around $27,296 and generates approximately $79,000 in savings over 25 years, with a payback period of about 11 years.
With Texas electricity rates increasing 23% from 2021 to 2024, solar panels lock in predictable energy costs and protect against future rate increases. Austin’s abundant sunshine—over 300 sunny days annually—maximizes your system’s production and long-term financial returns.
We’re proud to serve Austin homeowners with quality solar installations. As a national company with local expertise, we’ve completed 3,810 installations across Texas since 2020.
Our approach combines competitive financing options with a reliable installation network. We handle everything from design to activation, making the solar process straightforward for Austin residents.