Texas Solar Panels
In This Guide
Solar in Texas
Rising electricity costs hit hard. For Texas homeowners, rates have jumped 28% from 2020 to 2024—turning monthly bills into a growing burden. That’s why more families across the state are looking at solar panels for their homes as a way to take control of their energy costs.
This guide covers everything you need to know about solar installation in Texas, from how the process works to what makes sense for your specific home and budget.
Texas Solar Panel Cost
Our calculator uses real installation data from Texas homeowners in cities like Houston, Dallas, Austin, and San Antonio. Enter your details below to see accurate solar costs based on actual projects we’ve completed in your area.
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Cost
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Key Takeaways
- Texas electricity rates jumped 23% from 2021 to 2024, making solar panels an increasingly smart way to lock in predictable energy costs.
- A typical 9.72 kW system in Texas costs around $27,296 and can save homeowners approximately $79,000 over 25 years.
- Texas offers property tax exemptions for solar installations, so your panels won’t increase your annual property tax bill.
Looking for More Detailed Texas City Guides?
Explore our comprehensive solar guides for major cities across Texas to find location-specific information on incentives, installers, and solar potential.
Texas Electricity Prices
Electricity costs in Texas have climbed steadily in recent years. Understanding these trends can help you make informed decisions about your home’s energy future.
From 2021 to 2024, Texas electricity rates increased from 12.1 cents per kilowatt-hour to 14.9 cents—a 23% jump in just three years. That translates to higher monthly bills for the average household.
Solar panels generate electricity at a fixed cost, shielding homeowners from these rate increases. Once installed, your system produces power at the same price for decades, regardless of utility rate changes.
Over a 25-year period, this protection from rising rates can result in substantial savings. Many Texas homeowners find that solar helps create predictable energy costs while reducing their dependence on the grid.
Price of Energy: Texas vs National Average
Texas Area Utility Providers
Texas electricity rates vary widely by provider. According to 2023 data, most major utilities in the state charge between 10.3¢ and 14.7¢ per kilowatt-hour—generally below both the state average of 14.5¢ and the national average of 16.0¢.
Texas benefits from abundant natural gas resources and a deregulated energy market in many areas, which helps keep rates competitive. However, prices can spike during extreme weather events, and rates have been trending upward as demand grows across the state.
Understanding your utility’s rates helps you calculate potential solar savings. When you generate your own electricity, each kilowatt-hour produced offsets what you’d otherwise pay your utility—creating predictable energy costs that don’t fluctuate with market conditions or seasonal demand.
Texas Utilities Electricity Rates
Texas Solar Incentives
Texas offers financial incentives that make solar more affordable. From property tax exemptions to net metering programs, these solar incentives in Texas help offset installation costs.
The state’s property tax exemption prevents your home’s value increase from solar panels from raising your property taxes. Meanwhile, net metering programs from most Texas utilities credit you for excess energy your system generates at retail rates.
These incentives change regularly. Research current programs in your area and act promptly when beneficial incentives are available to maximize your savings.
| 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 home’s appraised value and result in higher annual property taxes. With the exemption in place, you pay property taxes as if the solar system wasn’t there, providing ongoing savings throughout the life of your system.
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 is before May 1st, though you should contact your local appraisal district to confirm specific requirements and timing. Since property taxes in Texas are assessed and administered locally by counties and school districts, the actual tax savings will vary based on your local tax rates and your system’s added value. This exemption continues as long as you own the property and the solar system remains installed.
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 the full retail rate, most Texas utilities offer net billing programs that credit exported solar energy at lower wholesale rates, typically ranging from 3 to 10 cents per kilowatt-hour. The specific program available to you depends on your local utility or Transmission and Distribution Utility (TDU) company and, in deregulated areas, your chosen Retail Energy Provider (REP).
In deregulated areas served by major TDUs like Oncor (Dallas), CenterPoint (Houston), AEP Texas, and TNMP, homeowners typically work with REPs like Shell Energy or Green Mountain Energy. Shell Energy’s Buyback Plan, for example, credits exported energy at 7 cents per kWh (as of April 2024), with excess credits rolling over monthly but forfeiting each December without payout. Some municipal utilities and cooperatives offer more favorable terms—Grayson Collin Electric Cooperative provides true 1:1 net metering with credits that carry over year to year, while CPS Energy (San Antonio) offers monthly net metering with credits valued at approximately 2 cents per kWh in summer and 1.65 cents per kWh in winter. Austin Energy uses a unique “Value of Solar” model, crediting all production at 9.91 cents per kWh regardless of when it’s used.
Eligibility typically requires installing an approved solar system and enrolling in your utility’s distributed generation program. Many utilities charge additional monthly fees for solar customers, ranging from $4.95 to $30 per month, which can significantly impact your overall savings. It’s important to understand that most Texas programs settle monthly, meaning excess credits don’t accumulate long-term value, and any unused credits are typically forfeited at year-end. Before installing solar, contact your specific utility provider to understand their exact compensation structure, as rates and policies can change annually and vary widely across the state’s diverse electricity landscape.
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Get a Free QuoteTexas Solar Irradiance
Solar panel production varies throughout the year based on daylight hours, weather patterns, and sun intensity. Texas enjoys abundant sunshine year-round, though summer heat can slightly reduce panel efficiency. Seasonal sun angles and occasional weather variations affect monthly output, but Texas remains excellent for solar energy production.
What Can the Average Texas Solar System Power?
Summer Production (July)
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)
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
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 Installations in Texas
We’ve mapped every solar installation across Texas to help you explore the clean energy revolution happening in your community. Click any area to see how many of your neighbors have already made the switch to solar power.
Leasing Solar Panels
Texas homeowners have flexible options for going solar beyond purchasing a system outright. Palmetto’s LightReach program offers both solar leases and Power Purchase Agreements (PPAs) depending on your utility provider.
With a solar lease, you pay a fixed monthly amount for your system—predictable costs that don’t change with the seasons. A PPA works differently: you pay per kilowatt-hour of electricity your panels produce, similar to how you pay your utility now. Your bill varies with production, typically higher in summer when panels generate more power. Both options eliminate upfront costs and include installation, maintenance, and monitoring—all managed by Palmetto.
Availability varies by location. Most Texas utilities support PPAs, while several electric cooperatives offer leasing options. Some areas like Austin Energy and San Antonio’s CPS Energy currently don’t support third-party ownership programs. Understanding which financing option works for your utility helps you make the right choice for your home.
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 Texas. The state’s abundant sunshine and rising electricity rates create favorable conditions for solar investment.
With electricity costs jumping 23% from 2021 to 2024, solar panels help lock in predictable energy costs. Texas homeowners typically see payback periods around 11 years, with average 25-year savings of $79,000. The state’s property tax exemption for solar installations further improves returns by preventing tax increases from your system’s added home value.
Texas doesn’t have a statewide net metering policy. Instead, compensation for excess solar energy varies by utility provider and location.
Most Texas utilities offer net billing programs that credit exported energy at wholesale rates (typically 3-10 cents per kWh) rather than full retail rates. For example, Shell Energy’s Buyback Plan credits exports at 7 cents per kWh in areas served by major providers like Oncor and CenterPoint. A few utilities like Grayson Collin Electric Cooperative offer true 1:1 net metering with year-round credit rollover, while others like CPS Energy provide monthly netting with seasonal rates around 1.65-2 cents per kWh.
Yes, solar panels increase home value in Texas. Research from Zillow shows homes with solar panels sell for about 4.1% more than comparable homes without solar.
For a typical Texas home valued at $300,000, that translates to an additional $12,300 in resale value. Thanks to Texas’ property tax exemption for solar installations, you gain this value increase without paying higher property taxes while you own the home.
A typical solar installation in Texas costs around $27,296 for a 9.72 kW system, which works out to about $2.81 per watt. This size system is designed to offset approximately 100% of electricity usage for an average Texas home.
The actual cost varies based on your home’s energy needs, roof characteristics, and local installation factors. Most Texas homeowners see payback periods around 11 years, with average savings of $79,000 over 25 years.
For most Texas homeowners, solar delivers strong financial returns. With electricity rates up 23% since 2021 and continuing to rise, solar panels lock in predictable energy costs for decades.
A typical Texas system costs around $27,000 and pays for itself in roughly 11 years through electricity savings. Over 25 years, homeowners save an average of $79,000. The state’s property tax exemption means your home value increases without raising your annual tax bill.
At Palmetto Solar, we’ve completed 3,810 installations across Texas since 2020. We combine national resources with local expertise to deliver quality solar solutions throughout the state.
We offer flexible financing options and work with trusted local installation partners to ensure your system is installed correctly. Our approach focuses on making solar straightforward and accessible for Texas homeowners.