Texas Solar Savings Calculator

The single biggest change for Texas homeowners considering solar in 2026 is the expiration of the 30% federal Residential Clean Energy Credit (Section 25D). This credit, which previously reduced the cost of a homeowner-owned solar system by 30%, ended on December 31, 2025. For a typical 8 kW system costing $22,400, that is a $6,720 increase in out-of-pocket cost compared to 2025.

However, the Section 48E Investment Tax Credit (also 30%) remains available for commercial entities. This means solar installers who offer lease or Power Purchase Agreement (PPA) arrangements can still claim the credit on your system and pass the savings through as lower monthly payments. This fundamentally changes the buy-vs-lease calculation for 2026.

Buying (cash or loan) still makes financial sense if you plan to stay in your home for 15+ years. You retain ownership of the system, keep all electricity savings, and benefit from the property value increase (which is property-tax-exempt in Texas under Section 11.27). However, the payback period is now longer without the federal credit.

Leasing or PPA arrangements have become more competitive in 2026 because the installer can still access the 30% Section 48E credit. You typically pay no upfront cost, the installer handles maintenance, and your monthly lease payment is structured to be lower than your current electricity bill. The trade-off is that you do not own the system and do not build equity. If you rent, many newer Dallas apartments and Austin rentals already include energy-efficient features that lower your utility bills without any upfront solar investment.

Texas does not have a statewide net metering policy. Instead, retail electricity providers offer voluntary solar buyback plans with varying rates for excess energy you export to the grid. Most buyback rates range from $0.04 to $0.08 per kWh, significantly below the retail rate of $0.10 to $0.14 per kWh.

This means self-consuming your solar production is worth roughly twice as much as exporting it. Strategies to maximize self-consumption include running heavy appliances (dishwasher, laundry, EV charging) during peak solar hours, using a smart thermostat to pre-cool your home in the afternoon, and considering battery storage.

Texas Tax Code Section 11.27 provides a 100% property tax exemption for the appraised value added by solar energy devices. If your solar installation adds $20,000 to your home's market value, that $20,000 is completely exempt from property taxes.

With Texas property tax rates averaging around 2.1%, this exemption saves approximately $420 per year on a $20,000 system — a meaningful benefit that is often overlooked when calculating solar ROI. This exemption is automatic and does not require a separate application beyond your standard homestead exemption. Of course, renters avoid property taxes entirely -- find apartments across Texas and let the landlord handle taxes.