State solar incentives

Switching smart: Solar incentives in Texas

Texas is second after California in the top solar-generating states. It might become number one in the next 5 years. Why did solar energy get so popular there? Electric prices go up like never before. Our advice: go solar ASAP but do it the smart way: read our article about Texas solar incentives and make use of them.

Why go solar in Texas: Power outages, storms and sun

Texas is a huge energy factory. In 2022, the state produced 12% of the U.S. electricity, twice as much as second-place Florida. It also generates over 12% of solar energy in the United States. SEIA believes that it is going to outpace California by 2028. The solar industry blooms in Texas, with Mission Solar growing to be the face of American-made high-quality solar panels.

Texas sun shines bright all year long

5.73

average number of peak sun hours in Texas

The first obvious reason for this is a lot of sunlight. Texas gets 135 clear days a year and about 5.73 peak sun hours a day. What is more, Texas is located in the south and gets enough peak sun hours both in summer with a maximum of 6.29 in August and in winter with a minimum of 4.11 in December. A 7-kilowatt solar system will generate over 30 kWh/day of AC for half a year, enough to fully power a medium-sized house.

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Texas has the most power outages in the US

More than 9,500 tornadoes were reported in Texas between 1950 and 2021. About 120-130 tornadoes hit Texas every year, according to data from the National Oceanic and Atmospheric Administration (NOAA). They often lead to destruction and power outages. Solar panels are a great choice for a tornado-heavy state: they withstand winds of at least 140 mph and add a layer of protection to your roof.

A solar system with batteries makes a lot of sense in Texas because of the high number of power outages. Texas experienced more power outages than any other state, according to Climate Central. Of the 1,542 weather-related outages documented in the U.S. over the study’s 20-year analysis, 180 were in Texas. The ice storm that hit the state in February 2021 left more than 4.5 million homes and businesses without power, some for several days. The crisis caused at least 246 casualties. 

Watch our video about the best batteries on the market!

Texas electricity prices spike up

An average Texas household, consuming 1,094 kWh per month, pays $158.19 on electricity. This is close to an average bill across the US. The prices are rising rapidly though: the price per kWh jumped 11.34% from 12.82 ¢/kWh in 2022 to 14.46 ¢/kWh in 2023

In late June, Texas broke a new temperature record with Rio Grande Village hitting 119 degrees. Electricity prices doubled amidst the heat wave from $2,500 per mWh to $5,000, pushed by soaring demand for cooling.

Solar system owners enjoy their freedom from terrifying bills. With a PV system completely satisfying your energy needs, you’ll save $1,500-2,000 a year and recoup your purchase costs in 5-7 years. Upfront costs of going solar become smaller when you consider Texas solar energy programs.

How to go solar in Texas: Solar incentives, credits, and rebates

There are many benefits for those who choose solar energy. We’ll guide you through the most important ones.

IncentiveSummary
Federal Solar Tax Credit (ITC)
Claim 30% of the solar system cost as an income tax deduction.
Property tax exemption
Install a solar system and keep the property tax the same.
Net metering
Sell solar energy to your utility company at a 1-for-1 rate.
Solar rebate programs
Benefit from rebates provided by your utility company.

Claim 30% of your solar system cost with Federal Solar Tax Credit

With the Solar Investment Tax Credit (ITC), homeowners can deduct 30% of not only the solar system’s cost but also its shipping and installation from their income taxes. If your system costs $10,000, you can get over $3,000 back through a tax deduction.

Learn how to claim Solar Tax Credit in 5 minutes with our Youtube video!

Freeze your property tax with Property Tax Exemption

4%

that’s how much solar panels increase your home value on average

A solar system increases the value of your home by 4% on average. But with the property tax exemption, you don’t have to pay extra taxes on it. The value of your home increases, while the property tax remains the same. Win-win! To claim this exemption, fill out Form 50-123 and check the Solar and Wind-Powered Energy Device Exemption and Appraisal Guidelines for more information.

Sell excess electricity with Net Metering Program

On sunny summer days, your solar panels generate more electricity than your home needs. You can sell this extra energy to the grid for credits and receive an electricity bill reduction. In the best case, one kilowatt-hour given to the grid is one kilowatt-hour off of your next utility bill.

Net metering — a billing mechanism that credits homeowners for the electricity they give to the grid

Although Texas doesn’t have a statewide net metering program, there are many utility companies offering this opportunity. Here are some of them:

• El Paso Electric
• City of Brenham
• CPS Energy
• Green Mountain Energy (commercial)

Save up to $3,000 with solar rebate programs

Texas doesn’t have an initiative encompassing the whole state, but some local authorities and utility companies provide homeowners with nice rebates:

• Austin Energy offers a $2,500 rebate after completion of their free educational course. With this course, the company wants to help its customers make an informed choice about solar power.
• City of San Marcos offers a $2,500 rebate for the installation of grid-tied renewable energy systems. To qualify for the rebate, your system should be pre-approved by the utility and meet certain energy efficiency criteria. For more information, visit the program website.
• AEP Texas North Company and AEP Texas Central Company offer up to $3,000 rebates for installation of solar systems. The system should be new and meet the minimum estimated performance requirements (80% of optimum). Please refer to the Program Guidebook for additional details.
• Oncor Electric Delivery also offers rebates for the installation of solar systems. The systems should be new and equipped with batteries. For more information, visit the program website.

Ask your utility company about the rebates they provide. A couple of thousand dollars saved will make the purchase of your solar system even better.

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SHOP SOLAR PANELS

Years of experience in translation and a love of nature help Julia find the right words to encourage going solar. She joined the team in 2023 and is happy to make her contribution to a greener future.

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