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Congratulations! You've found the ultimate guide to going solar in Texas

2018 Policy Grade


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Your 2018 guide to going solar in Texas

This page is a complete guide to the complicated and sometimes confusing process of installing solar panels on your Texas home. Since there's a lot to consider, we've separated the page into sections to help you find what you are looking for. If you find this page useful, please share it with someone who might also find it interesting!

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** What's new for 2018 **

Solar in the Lone Star State is great in 2018... unless you're thinking about going solar in El Paso.

See, El Paso residents who install solar panels are now on the hook to pay a minimum monthly bill of $30, which takes a bite out of their potential savings. The good news is people who already went solar in El Paso won't be subject to the new monthly fees until at least January, 2038.

As for the rest of the state: other cities and utility companies have not yet imposed fees on new solar owners, and some places like Austin and Dallas still have solar rebates available.

If you're thinking about going solar in Texas, it might be time to act before your utility company changes the deal. Connect with a Texas solar expert to take advantage of current rates and get solar installed for as little as $0 down.

The Solar Strategy section is focused on the 3 ways of paying for solar in Texas, so you can decide which is best for you. We've created a tool that asks you a few questions and recommends whether you should pursue a solar lease, loan, or outright purchase. Then, we provide detailed analysis of how each works.

The Solar, Step by Step section is a guide to everything that happens from before you get solar quotes to the time when the panels are on your roof and you're getting ready to claim that sweet solar tax credit.

The Policy Information section contains all our latest research on the rules set by lawmakers in Sacramento and the Public Utilities Commission, which determine how easy it is to go solar in Texas. These policies and rules govern everything from renewable energy mandates to interconnection, and have a huge effect on the viability of solar.

Finally, the Solar Incentives section includes information about money-back rebates and grants, tax credits, and tax exemptions for going solar in Texas.

Click any of the boxes below to go to that section of the page, or scroll down to read the page in order.

Your Solar Strategy in Texas

Figuring out the best way to go solar in Texas can be a little daunting. From loans and leases to power-purchase agreements, there are a lot of options out there. To help you pick the one that might be best, we've created the handy decision tool below.

We'll ask you a few simple questions about you and your home. Once you're done, we'll recommend a good option. Further down this page, we provide cost estimates and example return-on-investment calculations for all the various options:

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Your 3 Options for Going Solar in Texas

The chart above shows the 25-year returns for an investment in solar whether you choose to purchase a system with cash or pay over time with a loan or lease. One thing it's important to note is: solar makes you a lot of money in Texas. Yes, we said "makes!" You see, Texas gets so much sun, its relatively low electricity prices are no match for the awesome energy-generating ability of solar panels. Going solar in Texas starts paying off right away, and with great state and federal tax credits, solar has never been cheaper.

Now, because of the state's deregulated energy marketplace, it's a little more difficult to write this kind of one-size-fits-all review of the potential for solar. For one thing, there are some places where you can buy electricity from two dozen different companies, and some places, where you have to purchase it from your city's municipal energy company. That means you might get a better deal per kilowatt-hour (kWh) in Dallas, but you might get a bigger rebate on solar in Austin or San Antonio. So we've tried to use examples that are very neutral and use conservative estimates for how much you're paying.

Now let's discuss that chart above. We've examined three scenarios for going solar in Texas, including a solar lease, buying solar with a home equity line of credit (HELOC), or buying solar with cash. As you can see, the cash purchase option leads to the highest dollar-amount returns over time, but look a little closer. Taking a HELOC and paying for the system over time (the orange bars) means you'll spend thousands of dollars less over time, while reaping a big financial benefit in year 1.

That's because you take a loan for the system, but you still get all the benefits of paying up front. In Texas, that means a 30% federal tax credit, and big annual energy savings. With those incentives, you'll actually come out way ahead after the first year. And even though you'll be making loan payments for 15 years, the first-year windfall is so big, you'll only begin spending your own money in year 9.

Finally, take a look at the blue bars. They represent a solar lease or Power-Purchase Agreement (PPA), which are also called third-party ownership. With a lease or PPA, the solar installation company puts panels on your roof at no cost to you, and you make monthly payments that save you about $11 per month from what you had been paying the utility company for their dirty energy. Leases in Texas are awesome, because the state's high electricity prices mean you start saving money right away. Your savings will start small but finish big, because the lease cost will rise by less than the electric company's annual rate hikes. Third-party ownership is an excellent option even if you have equity or cash to put down, because it can save you tons of money!

Read more below about each of three very good options for solar in Texas.

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Option 1: Paying cash for solar

An outright purchase used to be the only way to get solar, and it's still the option that provides the "biggest" financial returns. The reason we put "biggest" in quotes here is because it's technically true—with lower equipment costs and that big Federal tax credit, solar costs less than ever before, and a solar installation pays itself off in 11 years. But if you're interested in solar as an investment, taking a loan to pay for the system is a better option.

With a loan, you can make monthly payments instead of putting $16,000 down on a solar system, which means you save money on electricity as you pay down the cost of your panels. If you have equity in your home or can get a large loan with an interest rate of 5% or less, a loan is the option to go with. It's like being able to start a business that is sure to succeed, just by having a roof. Read about loans below.

If you've got cash and you prefer to pay up front, you'll have to plunk down $16,250, but tax breaks and energy savings will erase a bunch of that after just 1 year. Over 25 years, your system will have produced over $21,000 in income, after your system cost is paid back. The reason this works is that solar offsets your electricity costs—enough to save you $842 in year 1—and it just goes up from there. As the electric company raises rates, you save more and more, and more...

Here’s how the numbers work for a 5-kW rooftop solar system in Texas:

  • Installing a typical 5-kW solar system should start at about $15,500. That's cheaper than solar has ever been, but it still might seem like a big investment. Don’t worry, because after tax breaks and energy savings, your first-year costs will be considerably less than that.
  • The Federal government offers a great income tax credit of 30% of system costs. That's $4,650 you won't be paying to Uncle Sam this year, and it brings your first-year investment down to $10,850
  • After that tax credit, we subtract your first year’s energy savings, which we estimate to be $794. That reduces your cost after the first year to only $10,056—a savings of about 35% off the cost of your system. That's a huge cost reduction!
  • Those electricity savings will quickly pile up, and your system will pay for itself in year 12. But your panels carry 25-year warranties, and they'll likely keep on kicking out kilowatts for a few decades or more. You'll see a total net profit of $17,232 by the end of that warranty. The internal rate of return for this investment is an amazing 8.8%. That's well above the return of an investment in index funds, and it's more reliable, too!
  • And here's a nice bonus to consider: your home's value just increased by $16,848, too—your expected electricity savings over 20 years—and thanks to Texas's property tax exemption for solar, none of that is subject to taxation!.
  • In addition to all that cash (and home value), you’ve created some green for the earth as well by not using electricity from fossil fuels. It's like planting 127 trees a year, every year your solar power system is humming.
Keep in mind, the numbers above are based on an average home in Texas. If you're ready for a custom quote for a solar panel system, our network of experts are on call to assist you. Simply sign up for personalized assistance on our special solar deals page.

Option 2: Using a loan to pay for solar

You don't need $16,000 sitting around to pay for solar. As long as you have equity in your home, you can still own solar panels and reap all the benefits. Heck, even if you do have the cash, getting a loan to pay for solar is by far the best option when it comes to percentage return on investment.

That’s because, in Texas, using a loan to pay for solar is like investing in a business that's sure to succeed, and also earns you a tax break!. You'll come out thousands ahead this year, and you'll see a spectacular profit over the 25-year life of your system. The reason this works so well is that you're paying over time, but reaping all the benefits now. Your yearly energy savings will offset over half the cost of the loan payments, too, which might sound like it's too good to be true... so let's take a look at the numbers.

A solar purchase like this will make sense for you if the following is true about you and your current situation:

  • You can get a home-equity line of credit (HELOC) for $16,250, with a fixed rate of 4.5% or lower and a 15-year repayment period. Don't be put off if you're offered a higher rate. It just means a tiny bit less of the thousands of dollars you'll make with solar.
  • You love making money without much risk.

Here’s how the numbers pencil out for a Texas homeowner who makes a solar purchase with a HELOC:

  • Installing a typical 5-kW solar system should start at about $15,500. That's how big your loan will need to be to cover it.
  • The electricity you'll save in the first year of operation would have cost $794, but your annual loan payments will be $1,376, meaning you would spend about $600 on solar this year, but...
  • You'll get a huge tax break! Uncle Sam will give you 30% of the cost of your system back as an income tax credit, which in this case means $4,650 you won't be paying the Feds this year.
  • Getting that tax credit means you'll come out $4,068 ahead after year 1, and it's pretty smooth sailing from then on out. Your yearly net cost (electricity savings minus loan payments) for solar will be $561 in year 2, and will shrink as the cost of electricity rises but your loan payments don't.
  • By the time you've paid off your loan in 2031, you'll see yearly savings of about $1,200. After 25 years, your total profit will be $12,095! Really awesome for a $0-down investment.
  • On top of the green that will stay in your pocket, your system will mean green for the environment, too—127 trees-worth, every year!
Keep in mind, the numbers above are based on an average home in Texas. If you're ready for a custom quote for a solar loan, our network of experts are on call to assist you. Simply sign up for personalized assistance on our special solar deals page.

Option 3: Buying the electricity, not the panels with a Power Purchase Agreement (PPA)

PPAs are a great way to go solar if you haven't got stacks of cash or oodles of equity in your home. It's possible to get solar panels for $0 down and see big savings over 20 years!

As for PPAs in Texas: the electricity costs here aren't very high—we're actually a bit lower than the national average—but the sun shines brighter here than almost anywhere else in the country! That means a lease saves you money starting on day 1. For now, the payments on a leased 5-kW solar system should be around $650 per year, but the energy the panels generate will save you $794 per year. That's $142 you get to keep in your pocket this year, just for saying yes to solar!

And those savings will only get larger over time. As the utility company raises rates, your lease costs will go up by a smaller amount, meaning you'll see greater annual savings. Over 20 years, our estimate shows a total savings of $3,991. And the best part is the panels will be owned and maintained by the installation company, so all you have to do is brag to the Joneses down the street about your green habits!

Here's a little more about how a Texas solar PPA works:

Keep in mind, the numbers above are based on an average home in Texas. If you're ready for a custom quote for a solar PPA, our network of experts are on call to assist you. Simply sign up for personalized assistance on our special solar deals page.

How much can you save with $0-down solar?

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Is solar right for your Texas home?

A beautiful home with solar panels

If you answer “yes” to each of the following questions, you’re probably a good candidate for solar.

  • Do you own your home?
  • Does your roof get direct sun for most of the day?
  • Does your electricity bill bother you (specifically how much you have to pay)?

The ideal home for solar has a south- or west-facing roof that gets little to no shade throughout the day. The roof can be covered with anything from asphalt shingles to clay or slate tiles, but the easiest roofs to work with are asphalt and standing-seam metal roofs.

Even if your home does not completely meet these conditions, you may still see huge savings from going solar. Your installer will take everything into account when providing you with a savings estimate.

We get more in-depth with roof shape, covering, and orientation in two useful articles:

The step-by-step process for going solar in Texas

The most important thing to know about the entire process of going solar is that your solar installer is good at this stuff.

They'll make sure all the T's are crossed and the I's are dotted during the whole process:

Step 1: Getting and Comparing Quotes

There are now many slick solar estimate tools online. Some have you draw lines on your roof from satellite imagery to place your panels and explain your savings. Others pit solar companies against each other in an automated battle for your dollars. Others still track the sun over the course of the year to show you your electric production with the panels you just struggled to draw on your roof.

In our view, they're all a waste of time. If you're serious about installing panels, the best way to get an accurate view of your costs and savings is to get actual quotes instead of messing around with these online tools.

After all, you're not a solar PV designer, it's better to let an expert who knows what they're doing use their own fancy tools for you (believe us—they have fancy tools).

Also, nothing beats a human connection from a trusted source. We've been forging relationships with strong partners and installers since 2007. They know what they're doing, and they're good people.

When you complete our form, we'll connect you with them. You’ll quickly get an accurate reflection of how much electricity your roof can make, how much your system will cost, and how long it will take before you see a profit. In Texas, with a loan or PPA, you'll be in the green immediately.

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What you should look for in a solar installer

Solar customers with a contractor looking at contract

If you seek solar quotes directly from providers without our help, be sure to judge them by the following criteria. All partners in our network are:

  • Trained and Skilled - The standard for solar installers is certification by the North American Board of Certified Energy Practitioners (NABCEP for short). That means they’ve undergone training and passed tests that ensure they know what they’re doing.
  • Experienced - How many solar systems has the company installed? A minimum of 10 is a good number to shoot for, unless you know they company well. Of course, choosing Tesla or Sunrun means you’re with a company that has installed thousands of systems, but their process can seem less personal, and their prices are often higher than smaller companies.
  • Well-regarded - Look at reviews of solar providers on Yelp and Google and other review sites. Or simply ask the salesperson to speak with one of the company’s former clients. Solar owners generally love talking about their systems, and you can benefit from their experience.
  • Licensed, bonded, and insured - Make sure the installation crew includes a licensed electrician, because if not, that can be a surprise charge to get the system hooked up.And of course, the company you’re going with has to be bonded and insured in case they do any damage to your home.

The solar quote process

Your first contact with one of our solar providers will be over the phone. They’ll take a look at a satellite photo of your roof and verify some simple details about you and your home. Many will be able to provide you a complete estimate without coming to your house. If you prefer, you can review your estimate in person.

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Information included in solar quotes

A sample solar quote

Your quote will include information about how many panels will be used, how much electricity they can produce, your expected savings over time, and more.

  • System size - System size isn't just about the square footage the panels will occupy on your roof. In the solar industry, size refers to the number of watts your system can produce in full sun. The average solar panel puts out 250 watts at a time, so your installer would call a system of 20 panels a "5-kW system."
  • Energy production - Your solar panels' energy production is measured in kilowatt-hours (kWh), just like your electricity usage is measured by your utility company. The quote will include an estimate of the average kWh your system will produce per year, and might even show you how the seasons affect expected production by month.
  • Cost and incentives - Solar system prices are quoted as "total cost" and "dollars per watt." For example, a 5-kW system that costs $15,500 has a $3.10 cost per watt. These are the first figures to compare what you’re being offered. The installer should also show you the available incentives that being the net cost of the installation down. Everyone is eligible for the federal solar tax credit of 30% of the system's cost, but there may be local incentives available, as well.

    Note: if you're considering a PPA, you won't be eligible for incentives, and the cost section will include your expected costs per kWh.

  • Equipment - Not all solar panels are created equal, but nearly all the panels used by reputable installers should be able to reliably make electricity for the next 25 years. The options are numerous, and your installer should be able to provide you quotes for a few different kinds. For example, if having panels made in the USA is important to you, your installer should be able to offer you a quote for a system using panels from the USA and panels made elsewhere.
  • Warranties - A solar system has multiple warranties that cover the panels, the inverter, and the installer’s work on your roof. What can change between quotes is the length of the warranties and what they cover. Read our full post on solar warranties and what they cover.

Deciding which solar quote is the best

Now for the easy part: choosing which solar company has the best offer. If one installer offers a lower cost per watt using great equipment, they might be the best choice. Just keep in mind that important considerations other than price set solar companies apart.

Larger installers are all about full service and efficiency, making the process of going solar fast and streamlined. They all offer in-house financing options and multiple ways to pay, and they might also throw in bonuses like free monitoring equipment and long-term warranties.

Smaller installers don’t have the overhead of national solar companies, so they can compete more on price. You might even develop a meaningful relationship with a member of your community who has been doing this for a while, and if something goes wrong with your system, it might feel better to pick up the phone to call them rather than an 800 number tied to a high-volume call center. Just keep an eye on their financing offerings. Third-party lenders for solar financing sometimes include finance charges or higher interest that can mean you save less in the long run.

For more of our guidance on choosing an installer, check out these useful articles:

Step 2: Financing your system

Pile of cash

If you plan to pay up front, this step is easy. Just get your checkbook out and make it happen, high-roller! But if you’re interested in a loan or PPA, it’s time to explore options.

Many installers will offer you financing at this point. Compare their offer to the other options you have. If they offer third-party financing, it might be time to explore a HELOC with your bank before you sign their financing arrangement.

We discussed the options in the section on loans above, but here’s a quick refresher:

  • Home Equity - Probably the best way to pay for solar, because you control it, the rates are lower, and you can repay it in a more flexible way.
  • Solar loans - Most installers will offer some kind of financing. The big guys like Sunrun, Vivint and Tesla/Solarcity have their own loans they can offer you, but most mid-sized installers work with a solar loan provider like Mosaic. These loans are usually structured with the solar tax credit as a balloon payment after 1 year, and the balance of the system cost as a long-term loan at 5%-7% interest.
  • PACE loans - Property-Assessed Clean Energy financing is good for people who don’t have amazing credit or tons of equity, but who plan to live in their home for years to come and don’t mind slightly higher interest rates. The loan is repaid through your property tax bill, the interest is often tax-deductible, and repayment can be spread across as many as 25 years.
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Don't forget about PPAs

If you don’t mind giving up a little control and letting your solar company own the panels, choose a PPA instead. These are only available through an installer, since they’ll be the ones who own the system.

Again, a PPA is best if you don’t have enough income to take advantage of the 30% federal solar tax credit, but it can work for anybody. It’s generally simpler than owning your own system. You just sign on the dotted line and start getting lower cost electricity from your solar company.

Step 3: Signing a contract, and what happens after

hands signing a contract

So, you’ve settled on a solar installer, and lined up the funding to pay for your shiny new panels! After you sign on the dotted line, it’s time for the pros to begin their work!

Site Inspections

First up, you’ll be seeing a few folks out for site inspections. There will be a master electrician out to look at your main circuit panel and wiring, a solar contractor to do a detailed analysis of your roof and determine the best placement for the panels, and a roofing contractor to examine the structural integrity of your roof.

Design and permitting

Following the inspections, the system designer will get to work on a digital design for your system. Your solar company will finalize the design and components, and give you a final price for approval. Once you’ve authorized the final design, your solar installer will finalize the documents and submit them to your locality for permitting.

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Step 4: Installation, Inspection & Interconnection

Two workers install solar panels on a roof

Texas is a mature solar market and most installers have their procedures down pat. Installation, which used to take several days, now usually takes between 4 and 8 hours. Unless your roof is complicated or your electrical systems need updating, your crew should arrive, perform their duties, and be done within one day.

Installation day

Your installer will have already completed their site surveys and the workers on the truck will know exactly what they're installing and where. The crew will arrive at your home, set up their gear and get to work on your roof.

The first thing they'll do is mark off all the places the solar panel mounts will be placed, then attach those mounts to your roof. If you'd like to know more about the big metal bolts that will be screwed into your rafters, check out an article on how solar panels are attached to your roof.

The crew will then install the racks and panels, making connections that either wire the panels together in strings, or bring the wires from the micro-inverters together. If the crew includes a master electrician, that person will make the final connections between the panel, inverter, and your main AC panel (you may have to wait a day or two for the master electrician to finish the wiring).

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What the heck are micro-inverters?

Traditionally, solar panels are wired in a series and connected to a single inverter box, which converts the electricity from DC to AC so it can be used in your home. Those large inverters work great for most people, but tend to make the system overall a tiny bit less efficient. Also, if a shadow or cloud passes over and blocks sunlight to some of your panels, the whole system suffers.

Micro-inverters, on the other hand, are attached to the back of every panel, which ensures that the maximum energy output of each panel reaches your home wiring. They cost a little more, but for a house with a partially-shaded roof, they can pay for themselves quickly.

Here's an infographic showing how the two types of inverters differ:

A string of solar panels with one shaded produces only half its rated power With micro-inverters, one shaded panel doesn't affect the whole bunch, allowing more electricity to get to the meter

Inspection and Interconnection

After your system is installed, it needs to be connected to the grid, and for that, you’ll need to have it inspected. Your installer will line all this up for you, too, and it may take between a couple days and a couple weeks to get the final inspections scheduled and completed.

An inspector examines and electrical box

Your city may require an inspection from the fire department, but the most important inspection will come from the utility company, who will send out someone to examine your system’s components and wiring and install the new electric meter that will record your solar kWhs.

At this point, you might even get a chance to turn the system on yourself!

Step 5: Operation, Maintenance, and claiming your tax credit

A squeegee cleaning solar panels

So you’ve got a shiny new solar system installed and it’s working. Now what? To be honest, not much. Solar panels are the platonic ideal of a Ron Popeil creation: set it and forget it. Still, you might find yourself compulsively checking your monitoring software to ensure those panels are working as promised.

After the deep breath of fresh air that comes with seeing your new electric bills, you'll relax into a state of solar bliss. During other moments, you'll smile as you think of all the acreage of forest you basically just planted using only the few hundred square feet of your roof.

There are a few important things to know after your panels are installed:

How to maintain your solar panels

Maintaining solar panels is a breeze. Solar panels are designed to handle rain, wind, snow, hail, and whatever nature throws at them for 25 years or more. All the maintenance a solar panel system needs is a yearly rinse and squeegee to take off extra dust and grime; maybe 2 or three times yearly if you live in a very dusty place. You can get by with a hose, if you need to.

If you own the system, either with a loan or having paid cash, you can expect to do (or contract out) the work yourself. If you have a solar PPA contract, this annual or semi-annual cleaning may be included as part of your agreement, or you may have the responsibility to do any cleaning yourself. Be sure to look for this information as part of a PPA offer.

How to tell if your solar components are working

Other than cleaning, you may someday experience the failure of one or more components. Right off the bat, you should be able to see whether your panels are delivering energy on the panel of your inverter or net meter.

Read the user manual of your inverter to find out how to access the proper information, but most inverters will have a real-time production number on an LCD readout right on the front.

If you have a system with a central inverter, you will likely need to replace it after 10-15 years. If, instead, you have micro-inverters attached to each panel, they should last for the life of your system, and if not, they’re usually covered by 25-year warranties.

A micro-inverter attached to the underside of a solar module

Micro-inverters, like the one shown above, coupled with monitoring software can make it easier to tell when a panel isn't producing enough energy

Your installer may also have included monitoring software as part of your installation, either on a screen attached to your system or on the web. The monitoring software will tell you if the system is functioning properly, and, if you have micro-inverters on each of your panels, can even tell you if any panels are not working as they should.

If you discover that one or more of your panels isn’t working, it’ll be time to file a warranty claim.

What to do if your panels stop working

If you’ve done a good job by choosing one of our installer partners, you’ve got warranties that cover the installation (e.g., watertightness of roof penetrations and structural integrity of your roof), the panels (manufacturing defects) and the energy (production guarantee).

Your first step is to figure out who to contact. If you have a PPA contract, that step is simple: call your installer or contact them via their customer portal. That might also be the case if you sign up for a solar loan from a big installer. Oftentimes, the loan comes with a similar kind of protection.

a cracked solar panel

This isn't supposed to happen, so if it does, know who to call.

If, however, you went with a different installer, perhaps sourced through a different website, you’re probably stuck looking through the paperwork you got with the system to find the manufacturers of your panels, inverter, or other components.

How to claim the federal tax credit for solar

Claiming the Federal Solar Investment Tax Credit (ITC, for short) is easy, just have your personal assistant fax all the necessary paperwork to your accountant in the Caymans, and wait for your huge refund.

A fanned-out stack of a few 1040 tax forms

Oh wait, you don't have millions in an offshore account? Then we've got the necessary info for you. The ITC is claimed by filling out a special schedule, Form 5695, and entering the credit amount from that into your 1040 form.

For your edification and convenience, we've prepared a step-by-step guide to claiming the solar tax credit.

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Texas Solar Policy Information

Ever wonder why solar seems to be everywhere in some states, but not in others? We did too.

State legislatures and public utilities commissions can enact rules to make solar power accessible for everyone. Favorable rules explain why some of the cloudiest states—New York, New Jersey, and Connecticut, are doing so well with solar, and yet some of those with the most natural solar resources—like Alabama, Mississippi, and Georgia—are doing so poorly.

Below is important information about the public policy, rules, and economic reasons that affect your ability to go solar here in Texas.


3% by 2015 (exceeded)

Grade: D

Texas's Renewable Portfolio Standard grade

A Renewables Portfolio Standard (RPS) requires utilities in the state to eventually source at least a certain percentage of their electricity from clean, renewable sources like solar panels.

Normally an RPS sets targets for a certain percentage of total energy generation to come from renewables, but in Texas, the targets are amounts of electricity produced, measured in megawatts (MW). The Texas RPS was first passed in 1999 with a target of 2,000 MW of energy from renewable resources. In 2005, the legislature increased the requirement to 5,880 MW by 2015 and set a voluntary goal of growing this capacity to 10,000 MW by 2025.

But wind power in Texas is hugely profitable, and by 2009, Texas had already surpassed their 2025 goal. As of 2015, the state has 15,635 MW of installed wind capacity. Despite wildly exceeding even their voluntary "pie-in-the-sky" 2025 goal, the state has yet to increase their RPS targets.

and while 15,635 MW of wind capacity may seem like a lot, it actually accounted for only 10.6% of total electricity generated in the state. In fact, Texas leads the country in total energy consumption, which may seem unsurprising given its size. Yet, the Lone Star State still ranks in the top five for energy consumption when distributed per capita.

For any state—especially one that is as power hungry as Texas—10.6% is far too low of a goal for renewable generation. We’ve seen other high-population, high-energy demand states like New York (30% by 2015) and California (33% by 2022) set much loftier goals, and there are even states (Hawaii) taking aim at 100% renewables by mid-century.

Texas’s RPS is critical to strong renewable energy policy. Utility companies aren't really all that gung-ho about you producing your own power. After all, it costs them money when you use less of their electricity. They also don’t naturally want to give you big payments for energy you're feeding back into the grid. The main reason the utilities are aiding your transition to lower electric bills and offering you incentives to put solar on your roof is because the state forces them to. If the utilities don't hit their RPS numbers, they have to pay large fees back to the state.

What's an RPS? Your state legislature paves the way for strong solar energy incentives to flourish by setting standards for renewable energy generation within their territories. Those standards are called the state’s renewable portfolio standard (RPS). If utility companies do not meet these standards, they must pay alternative compliance fees directly to the state. Many utilities then determine the best ways to source their energy from renewable sources that are less expensive than this fee.

An RPS is a mandate that says "Hey utilities! Y'all now have to make a certain percentage of your electricity from renewable sources. If not, you'll have to pay us huge fines." The consequences are good, because utilities usually try to meet these RPS standards by creating solar power incentives for you, the homeowner. Read more about Renewable Portfolio Standards.

RPS solar carve out


Grade: F

Texas's Solar Carve-out grade

Though Texas requires at least 500 MW of their 2015 goal come from renewable resources other than wind (since about 96% of their renewable energy was sourced from wind in 2015), they do not specify that it must come from solar and this target remains largely voluntary. If the RPS contained specific carve-outs for clean and efficient technologies like solar panels, or mandates for the environmentally necessary increases in distributed generation, you’d see even stronger incentives for residential solar power.

What's a solar set aside? A solar set aside guarantees a specific portion of the overall renewable energy mix generated comes from the sun. For those states with progressive standards, high alternative compliance payments, and clear solar carve outs, the faster those areas become ripe for solar.

Some states have higher alternative compliance fees than others, and some states have more progressive alternative energy standards and deadlines than others do.

For instance, New Jersey has an overall RPS of 22.5% by the year 2021. That requires local utilities to source 22.5% of their energy mix from renewable sources by the year 2021. Pretty good. However, New Jersey also has a specific solar set aside of 4.1% by 2028. That’s the type of firm commitment which really gets the industry rolling forward. No wonder why New Jersey is one of the hottest solar markets right now!

Texas Electricity Prices


Grade: D

Texas's Electricity cost grade

Electricity runs about 12 cents per kilowatt-hour (kWh) here, but you might pay more or less than that, because of the companies who are selling in your area within Texas's deregulated market.

12 cents is just under the national average of 13 cents/kWh, but by our standards that national average is far too cheap. Energy is cheap because it’s generated from dirty-burning fossil fuels, at giant power plants that emit greenhouse gases by the billions of tons.

We’re already seeing energy prices start to rise as we become more and more aware of the effects of all those fossil fuels. As the price of energy continues to climb, the savings on your solar power system are going to rise along with it. Just remember to thank us for the tip when you’re spending all that cash on vacations instead of electricity.

Why are electricity prices so important? Because that is what solar power is directly competing against. The cost to produce power with solar is relatively constant (of course how much sun hits your area has an effect), so if you are paying $0.40 per watt for power, then you make FOUR TIMES AS MUCH as the guy or girl paying $0.10 per watt electricity.

The caveat here is that if the $0.10 per watt person has a HUGE rebate, they may be better off than the $0.40 per watt person. Because of that, states without any renewable standards tend to be heavily reliant on cheap coal for electricity, and also have very low electricity prices. When electricity prices are artificially low, that hinders the ability of solar energy to achieve meaningful payback in the state.

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Texas Net Metering


Grade: D

Texas's Net Metering grade

Net Metering requires your utility to monitor how much energy your solar power system produces and how much energy you actually consume, and make sure you get credit for the surplus.

Net metering in Texas is … wait what?! There is no net metering here?! Yikes! We’ve seen some states that don’t do much to incentivize solar power at the legislative level, but even most of those states still have a statewide net metering law! Sadly not Texas.

A smattering of localities do offer their own net metering laws -- and more are popping up. In the cities of Austin, Brenham, El Paso (El Paso Electric), and San Antonio (CPS Energy), net metering is available to residential solar power systems and any surplus is credited to future bills at the avoided-cost rate. In addition, customers of Green Mountain Energy are eligible for net metering, with surplus energy production credited to future bills at Green Mountain’s retail rate.

What is net metering? Net metering is the billing arrangement where you can sell excess electricity back to your utility for equal the amount you are charged to consume it. The more customer friendly net metering policies, the higher the grade.

The grade here specifically reflects individual solar system capacity, caps on program capacity limits, restrictions on “rollover” of kWh from one month to the next (yep just like cell phone minutes), metering issues (like charges for new meters), Renewable Energy Credit (REC) ownership, eligible customers and technology (the more renewables the better), being able to aggregate meters across the property for net metering, and safe harbor provisions to protect customers from solar tariff changes.

Texas Interconnection Rules


Texas's Interconnection Standards grade

While most of Texas does not ensure that you can have your energy consumption and production monitored for potential surplus, the state does have regulations designed to help ensure that you can get connected to the grid. Texas provides for standard interconnection procedures for all systems up to 10 MW. The regulations prohibit the utilities from requiring pre-interconnection studies, set 4-6 week time limits on how long the utilities can take to consider your application for interconnection, and offers fast-track pre-certification procedures to speed up the interconnection process.

That’s not too shabby. We’d like to see a prohibition on the requirement of redundant external disconnect switches and separate liability insurance, but compared to the rest of the state’s legislation, interconnection is a big step in the right direction.

Interconnection rules are a little technical, but they basically allow you to “plug in” to the electric grid with solar panels on your roof. The more complex, out of date, or nonsensical the state rules are for plugging into the grid, the lower the grade.

Specifically, the grade reflects what technologies are eligible, individual system capacity, removing interconnection process complexity for smaller systems, interconnection timelines and charges, engineering charges, prohibiting the requirement of unnecessary external disconnects, certification, spot interconnection vs. wide area interconnection, technical screens, friendliness of legalese, insurance requirements, dispute resolution, and rule coverage.

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Solar Incentives in Texas

Texas Solar Power Rebates


Grade: C

Texas's Solar Rebates grade

As we mentioned earlier, Texas lacks any statewide rebate program. Given that most folks outside of big cities have their choice of electric company through the state's open energy marketplace.

For those of you lucky enough to live in a place with a municipal electric company, there are some rebates available. Here's what we've found in the Lone Star state:

Utility Amount Notes
AEP Texas Central Company $1,050/kW Subject to additional requirements
AEP Texas North Company $1,050/kW Subject to additional requirements
Austin Energy $500/kW Maximum of $9,000. Incentive amounts decrease over time. Other requirements must be met.
City of Denton $750/kW Maximum of $30,000, not to exceed 50% of total costs. Additional $750/kW available if installation includes battery storage
City of San Marcos $2,000/kW, $5,000 max. Subject to additional requirements.
City of Sunset Valley $1,000/kW Must be eligible for Austin Energy rebate. Sunset Valley rebate offered in addition to Austin Energy rebate.
CoServ Electric Cooperative $1,000/kW Subject to additional requirements.
CPS Energy $600-$800/kW Amount varies based on whether system uses local components. $25,000 max.
El Paso Electric Company $750/kW 2015 fully subscribed. 2016 rebates TBD.
Farmer's Electric Co-op Up to $1,000 Must meet all program criteria.
Guadalupe Valley Electric Cooperative $1,000/kW Subject to additional requirements.
Oncor Electric Delivery $538.8/kW + $0.3462/kWh in 1 year Subject to additional requirements. Calculations for kWh per year are based on expected production. For example, a 5-kW array might produce 7,020 kWh in one year, and its owner would therefore be awarded $2430.32 in addition to the initial $2,694 rebate.

Since our last update, many rebates have come and gone, but there is still a lot of opportunity for solar savings in Texas thanks to these utility-based incentives. You can check your utility’s website for the most recent information on program status and application procedures. Or you can relax and connect with our expert partner installers in Texas, who'll make sure you get all the rebates and savings available.

How do solar rebates work? Similar to getting a rebate card from your local big box store for a dishwasher purchase, state legislatures also provide rebates for solar panel purchases to spur on investment and create new jobs. If you purchase the solar panel system yourself, you qualify for this free cash, which many times is a lump payment back to you. Some solar installers like to take this amount directly off the total installed price, and they'll handle the paperwork for you to make things a lot less complex.

The availability of state and utility rebates were sourced from the Database of State Incentives for Renewables and Energy Efficiency. The better the rebates, the higher the grade.

Texas Solar Power Tax Credits

No State Income Tax

Grade: None

Texas's Solar Tax Credits grade

Since Texas doesn’t have any income tax, there aren’t any solar tax credits to redeem! Luckily, you will still benefit from the 30% Federal Solar Tax Credit. Sample calculations follow below -- keep scrolling!

About state solar tax credits: State tax credits are not technically free money. However, they are 'credits' and not 'deductions' which means that if you have the tax appetite to take advantage of them, then they can be a 1-to-1 dollar amount off your taxes instead of a fraction of the cost of the system. So that means they can be an important factor to consider. In certain circumstances, state tax credits can provide a very powerful incentive for people to go solar.

(Keep in mind, we are not tax professionals and give no tax advice so please consult a professional before acting on anything we say related to taxes)

The availability of personal tax credits for solar energy were sourced from the Database of State Incentives for Renewables and Energy Efficiency. The higher the tax credit amount, the higher the grade.

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Solar Power Performance Payments


Grade: F

Texas's Solar Performance Payments grade

Texas lacks any performance payments for residential solar power systems. Not even individual utilities are offering them, as we’ve seen in some other states that lack a uniform system. See what we were saying about that weak RPS? If the target were increased to 30% or more of annual production, you can bet some of those utilities, maybe even the state, would start offering cash payments for renewable energy production.

Explanation of performance payments: Performance payments represent a big chunk of the financial rationale for going solar, and in many instances they make your decision a wise one. For certain states, if you’ve got solar panels on your roof, not only will you be cutting your electric bill down to size, but you'll be getting paid additional cash from your utility company. Pretty awesome, huh? Not only are you generating electricity for yourself, freezing your own popsicles with sun, and feeling like you’re doing something smart for your children or any of the other 4 reasons people go solar, but you are getting PAID!

Utility companies are paying people with solar panels on their roofs because their states say they have to, otherwise they will pay a fee. Therefore, the payment amount to homeowners is typically a little bit less than the amount they would be billed for by the state. For states with these alternative compliance fees, Solar Renewable Energy Credit (SREC) exchanges have popped up. In the above chart, we outlined an estimate of yearly payments a homeowner might expect from the utility company for the SREC credits from their solar energy system.

Expected SREC payments were calculated by using the latest trade values in the SRECtrade database. The availability of feed-in tariffs were sourced from the Database of State Incentives for Renewables and Energy Efficiency. The higher the expected monthly payments, the higher the grade.

If you don’t know what an SREC is, or how they work, check out this great SREC video

Property Tax Exemption


Grade: A

Texas's Solar Property Tax Exemptions grade

Finally! Score one for the Texas lawmakers -- coming through with a solid property tax exemption. When you install that shiny new solar power system, the resulting increase in home value (details on how much later) is exempt from 100% of the resulting property tax increase.

About solar property tax exemptions: Property tax exemption status is a pretty big factor when putting together your investment considerations. Many argue that solar power adds approximately 20 times your annual electricity bill savings (if you are owning the system and not leasing. Leasing still has a positive impact on the ability to sell your home though, in our opinion).

For many average-sized solar power systems on a house, that can mean $20,000 to your home value. (Edit April, 2014: Some companies, like Solar Mosaic, are starting to offer traditional style equity-based home loans for such a thing). An additional $20,000 in property tax basis in many states amounts to a big chunk of change owed back to the state. However, many states have complete exemptions from added taxes when you install solar on your home!

The availability of a property tax exemption for solar energy was also sourced from the Database of State Incentives for Renewables and Energy Efficiency. The stronger the tax exemption, the higher the grade.

Sales Tax Exemption


Grade: F

Texas's Solar Sales Tax Exemption grade

Now if only we could get a matching sales tax exemption. Sales tax ranges from 6.25% to 8.25% here, depending on the local tax rate. You may not notice it in small purchases, but that sales tax adds up for big-ticket items. A sales tax exemption is a simple and efficient way to save you a couple thousand bucks on those solar panels. No checks, no mess. Just discounts for you right off the top. Let’s get on that, lawmakers!

What's the deal with solar power sales tax exemptions? When states give you a sales tax break on solar, we notice. You should too. State sales tax exemption status for the purchase of solar energy systems were sourced from the Database of State Incentives for Renewables and Energy Efficiency. Sales tax exemptions, if present, were all 100%. A handful of states are completely exempt from sales tax regardless, and therefore received ‘A’ grades by default (OR, DE, MT, AK, and NH).

The consensus on Texas solar power rebates and incentives

Despite the lousy statewide regulations, those big fast utility rebates manage to keep the overall picture from being a total failure. The 12 year payback timeframe is, in fact, pretty decent. Normally that would be strong enough for a “C” grade from us. Unfortunately, with a poor showing on net metering and interconnection requirements, a return lower than average, and a minimal RPS keeping us in fear of closing rebate programs, we can’t bring ourselves to give the Lone Star State anything higher than a “D.”

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85 thoughts on “2018 Guide to Texas Home Solar Incentives, Rebates, and Tax Credits

  1. David says:

    One great solar installer in Dallas, TX is Sunfinity Solar. Right now they are located in Dallas, TX but I am hearing that they will be expanding into all areas of TX very shortly.

  2. David says:

    It’s 2017. Enough said. With elec. co-ops out here we have no access to subsidies. That is why the solar industry is not booming the way it should with our sun exposure. The leases are strange to those who are not in the know. Metering is still problematic, with some elec. providers not using net metering at all. If you are still coming here to read and educate yourself, take ONE minute to compose an email to your state rep and request more solar friendly legislation be enacted before our state congress disbands again later this year. Short state legislative window for opportunities. Just do it. You will feel better after you are done.

  3. jash says:

    I am wondering if houston light compny will buy excess power produced by indivual home owners?

    1. Ben Zientara says:

      Hi Jash-

      Houston Lighting & Power is now Reliant Energy, and they have a good solar buyback program. Read more here:

  4. jc says:

    if you want solar, check out the guys from Third Rock Solar and Water. They weren’t pushy when it came to getting solar and they were super down to earth. based out of austin but service texas and louisiana. is their website.

  5. Bailey Cale says:

    Hello my name is Bailey Cale.  I’m currently seeking employment, not just a job but a career. I have been in the oil and gas industry for 7 years now. I’m looking for a dependable and stable career. I’m very interested in a career in the new future, solar power and going green. I’m very interested in applying and getting a job in this industry. I’m a dependable worker and work as a team player. I’m just looking for a opportunity to get my foot in the door and work my way up. I was just wondering if yall might have some entry level positions open? Where can I send my resume ? I look forward to speaking with yall and hopefully one day having a career with this company.  Thank you Bailey Cale  254-300-2785

  6. Denise says:

    We live in Texas and are considering solar. However, in the covenants and bylaws, it states we can not have solar panels on our roofs. Someone told me that the courts passed a

  7. gary klucken says:

    Six homes on our residential street are wanting solar. Can we expect a price break by using the same installer/equipment provider?

  8. Alex Saracay says:

    SolarCity is dominating DFW

  9. Anonymous says:

    I use the VA hospital in Shreveport LA. This summer they installed big solar panels over thier big parking lot. Do you know how that is working out?

  10. Anonymous says:

    I enjoyed reading this page about the different regulations in different states. It is written in an amusing, easy-to-understand style. Apparently, people who are switching to solar energy are taking away the profits of the coal-fired energy plants, forcing the Big Guys to discourage solar power. It is the lobbyists for the old-guard who are convincing state governments to withdraw incentives to switch to solar. Here is an article I read today in which some experts proclaim that “old energy” is in a death spiral. “Old Energy Is Doing Everything It Can To Stop The Rise Of Solar”–2014-9 I would rather buy than lease solar panels. Thanks for this webpage, however. I learned a lot from it.

  11. Anonymous says:

    Are you smoking crack dude?! If I had ten or twenty thousand in the bank I’d drop half of it to buy stock in this company! Why? Because unless they go under from really horrible management it is as close to a ‘sure thing’ investment as you can get. similar to buying electric company stock, only BETTER because I unlike the electric company, the growth rate of a company like this has the ability to go through the roof because of a virtually untapped market! They literally can’t lose because you WILL pay your electric bill, you WILL save money and your neighbors WILL want in on this, so their business goes up again! outside of faulty equipment costs and related maint., its like their a bank giving you a car loan, just less likelihood of you defaulting! Government/state rebates etc reduces polution which means less health related problems nationwide. I could go on, but you get the point. QUOTE__Anyone asking for government “rebates” to buy and install what amounts to private property is asking a for a handout from someone else. Government has no money except what it steal from individuals under threat of loss of their home if they don’t pay. It’s a SCAM! See if you let this truth through, moderator. I suspect not because it conflicts with your agenda.__UNQUOTE

    1. The government subsidizes things it thinks are in the best interests of the country. We give tax breaks to home buyers because we are all better off when we have more home owners. We give tax credits to movie makers because we are all better off when they film movies in the United States, generating billions of dollars in economic activity. And we give tax credits for solar installations because it not only creates jobs and reduces household expenses, it reduces health care costs by reducing air pollution, etc. But soon, the tax credits for solar will expire and given the current political situation, it probably isn’t wise to assume that congress will be able to function well enough to renew them, so now is the time to get a solar system installed.

  12. Anonymous says:

    fyi, 10kw wouldn’t be wasteful, your home will suck all of the electricity up from those panels and still be using power from your utility company! p.s. website admin, I tried to reply to the author of the quoted comment using thr reply function but it FAILED to work using two different browsers on my tablet! QUOTE__Credits seem to be limited value if you aren’t using them up by the time they try and expire them. Like to do a 10kw on new home, though will do 5kw if no way to make sure excess isn’t wasted since battery storage is still too expensive.__UNQUOTE

    1. Your installer will use software tools to project what your system output will be for each month of the year and compare that to your historic electric bills for those months and ensure that your system isn’t sized too large for your needs. Depending on your utility, you might be able to roll over your credits for one month, one year, or forever, and that will also help determine the best size of your system. The best approach is work with your installer to determine the best system size.

  13. Anonymous says:

    Who can do Solar Leases in McAllen, Texas?

    1. The easiest way to get a quote on a solar lease in Texas is to go to and fill out the short form there.

  14. Anonymous says:

    Quick Note about Sales Tax Credit in Texas. Although we do not have a sales tax credit in Texas, we can tax the Federal Sales Tax credit because we do not have a state income tax. So it’s a Federal tax credit for sales tax paid in Texas.

  15. Anonymous says:

    Quick Note about Sales Tax Credit in Texas

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  17. Dilip says:

    So are the options in Houston area(CenterPoint) limited to getting credit thru the 3 utilities listed on for my area? No one is paying cash? Credits seem to be limited value if you aren’t using them up by the time they try and expire them. Like to do a 10kw on new home, though will do 5kw if no way to make sure excess isn’t wasted since battery storage is still too expensive.

  18. TateRehmet says:

    very interesting article, I may try to contact oncor about the rebate program in Dallas.

  19. Marcus Joo says:

    This needs to be updated.
    Oncor’s Take a Load Off Texas Rebate program is back online and people in the DALLAS-FORT WORTH area can take advantage of great solar prices now.

  20. Anonymous says:

    I’m in Melbourne Australia. Igot a1.5system installed for 3 grand and in the first year I payed 95 bucks for elctrisity

  21. Roy says:

    I do wish Texas would get more on the bandwagon with green energy..I truly do envy the folks living in Austin. They have a good deal going down there.

  22. enphase m215 says:

    Lets go GREEN Texas. The rebates are getting better. Payoff in ten years is pretty awesome. Plus saving our planet for our CHILDREN is pretty awesome.

  23. There should not be any payment to be made if someone uses solar unless it is for public use. I prefer solar Perth to be installed by myself. I am choosing solar powered systems because I don’t want to think of the costly electricity bill so these extra charges are really confusing because it defeats the purpose of installing a solar.

  24. PJ says:

    Reading all of this makes things sound really good and I would love to jump on board and have panels on my roof..I’ve been looking at a lot of sites regarding solar energy for a couple of years but the cost to do it is out of my reach …I also am seeing east texas is not included in the ares served

  25. Mike says:

    Can this be used on a commercial basis? And do the same rebates apply?

    1. Dave Llorens says:

      Mike, solar is different everywhere, sometimes all the way down to the neighborhood level. In general, yes, solar is worth exploring for commercial entities. Some places they look better than a home, financially, others, the opposite. Fill out the form to get a quote and if there is someone who can quote you commercial in the area the will give you a buzz.


  26. harvey says:

    The Austin lady sounded like she received a great deal from her utility company. What about someone from College Station Texas?

  27. Tom O'Donnell says:

    Hi, is the $2000 per kw still available in Texas, great forum thanks

  28. Dave says:

    Anyone asking for government “rebates” to buy and install what amounts to private property is asking a for a handout from someone else. Government has no money except what it steal from individuals under threat of loss of their home if they don’t pay. It’s a SCAM! See if you let this truth through, moderator. I suspect not because it conflicts with your agenda.

  29. ktp says:

    Just wanted to add my recent experiences installing PV system through Austin Energy. Systems have gone down significantly in price compared to just a few years ago. We got our 6.2KW system through Longhorn solar for just $20K, no battery system though, just 26 panels and the inverter box plus hookups and meters to the grid for selling excess back. With the Austin rebate of $15K and the tax credit, it came down to $3.5K out of pocket, which is very reasonable. With a saving of about $900 a year on electricity, everything should be paid off after 4 years and start earning money. That’s a pretty good deal.

  30. kev says:

    What amount of energy kW’s does a 3000 sq foot house use a year or say a 5k sq foot house?
    How much would a system described above generate?
    Then I can calculate after rebates how long the net cost takes me to earn back in savings?
    Do the prices include install, and all other equipment required i.e. 100% full system?

  31. Kim says:

    I live in Dallas Texas, another city that is suffering through this horrible heat wave and drought. We are starting to see rolling blackouts. I just bought my first home a month ago, but adding solar panels seems like it should be a first upgrade investment. I am looking through databases and am shocked that I don’t see a city as big as Dallas on any of the incentive lists for grants or tax rebates. Is there something out there that I am missing, or are we really not being incented to go green with power in Dallas or am I just missing us on the lists?? If I install now, without incentives, will I be eligible to be grandfathered in for a rebate at a later date?

  32. Debbie says:

    Iv’e had solar going on 12 years now and i’m sick of replacing these expensive batteries that are way to heavy for me to move.Is there not a easier,simpler way to store energy? I don’t recommend solar if your a woman and live alone and don”t understand electricity dc/ac no electric available where i live unless I can come up with $175K upfront. help any solutions to my problem???

  33. Georgia says:

    don’t see on PEC’s website that they off any type of incentive program. Was wondering if anyone out there knew if they did but just did not advertise it? I am going to email them, looks like with all the hill country customers they have it would be a cinch. We are leaning hard on the lease programs…..anyone out there tried it yet?

  34. Joe says:

    I might have missed this in the above answers.I have txu and use about 2kwh per month and I would like to know as of now is it worth the expense to install solar on my home in Houston. Also how long would it take to pay off

  35. Maria says:

    Thanks for the info, living in Houston seems to be creating issues, but with as much sun as we get and with the grid going down so often, they should be paying us to put panels on our roofs!!! I’m still searching for the right fix for me. My contract with Reliant ends in 2 weeks and I’m looking at leasing solar panels (new options), but that isn’t even truly available in Houston yet (mostly in California only). Why is the Houston energy market so darn difficult? It can’t be ERCOT, b/c look at Austin and San Antonio! TXU might be my best bet with their contract with SolarCity, but still seems cost prohibitive…..HELP!

  36. Phillip Kearn says:

    San Antonio offers the best rebate through CPS Energy (solar panels). For Commercial projects, they pay $3.00 per watt for up to $100,000. Residential is the same with a cap of $30,000. Most of the companies there are “mom and pops” so do your research. Uptown Solar and 1BG are the larger companies I recommend.

  37. edgar says:

    Were can i get info on who to sell energy from my solar panels in Laredo TX?

  38. tim says:

    I am looking to ease into the Solar Business and am looking for eduactional / training resources in Texas. Any suggestions would be appreciated.

    1. Tim,

      I’m not familiar with anything in Texas, but check out Solar Energy International based in Colorado, a very reputable place. They have some on line courses that would help you on your way and then perhaps you get some hands-on experience nearby. Hope that helps. Also, check out Solar Living Institute if you want to take a trip to California.

  39. Rose says:

    My only option in East (less than 15 minutes from down town Dallas) Texas is to be vitimized by my electric co-op. My co-op not only has numerous complaints against them according to PEC (not like PEC can do anything to them)but they also have some of the highest rates in any Texas co-op. They are NOT on any rebate lists that I can find & according to complaints I have heard/read from others, there is so much red tape bullcrap with HOAs & wind turbines, ‘good luck!’ Our co-op ‘claims’ they offer green energy incentives BUT only if your not in any kind of HOA violations?!?!?! Not too mention other ‘rules & regulations’ to qualify. Since when did the co-op & the HOA take over my rights to be green? The co-op ‘board’ still houses the same ‘good o’le boys’ from years past. As I know fully they will NEVER vote for deregulation, how can I make my one voice heard above the ‘good o’le boys’ on the co-op board? I would host functions, pass out flyers, makes calls ect, to do whatever it would take to push the co-op OUT! Can someone advise me as to where to start? I have checked Right To Choose, ERCOT, Americans For Prosperity & several others but the message seems to be the same. I’m moreless at the mercy of my co-op. Someone PLEASE help me!

  40. Murray says:

    Texas has probably one of the best Solar Environments in the Country. AEP just started offering last week a 2.50 a DC Watt rebate. See

    When combined with the programs recently announced by TNMP, Entergy and Xcel a vast majority of the state has very lucrative incentives. Much better than many other states though it is fragmented. Problem areas are the COOPS, El Paso and the Houston Market.

  41. ray eytcheson says:

    I found the thread very informative. It’s sad that Texas is so backward in having a unified policy regardless of provider. But the solar client is more interested in cost containment, than revenue generation anyway. We invest, we save!

  42. ray eytcheson says:

    Since there is no true correlation between watts and amps, how do we correctly determine the size of system that is necessary to assure a minimum of 100 amp availability via solar

  43. Murray says:

    Kevin, we have structured a tax lease for non-profits so other entities (usually us) can use the tax benefits which can then be passed along to the non-profit in the form of a lower priced unit at purchase option time. If you wish to know more about how this works contact me.

  44. Murray says:

    Dave, Txu through its Oncor subsidiary offers a 2.46 per watt grant. Since February we have been installing systems all over the Oncor system as an Oncor certified installer. Give us a call and we will walk you through the steps.

  45. Harrison says:

    Say, using the example at the beginning of this thread, I would like to install a 3 kW system that would be about $27,000 ($9.00/Watt x 3,000 Watts). In this example I wouldd be in line to receive the maximum incentive of $13,500. The Fed offers a 30% incentive in the form of a tax credit with no cap. Assuming you have the tax liability, you’re in line to deduct another $8,100 (30% x $27,000).

    Assuming that the above price is applying for a grid-tie system (no batteries). Now, I want an off grid system with batteries installed. Does the incentive apply to the initial batteries cost too ? When you say “system”, is it referring to the entire system or just the solar panel ?

    Dan Hahn mentioned that solar panels are guaranteed to be producing at at least 80% of their capacity at year 25. How often the batteries need to be replace within these 25 years. Will the batteries replacement cost is getting incentive too?

    David mentioned : “If your system is grid-tied, it will go down if the grid goes down”. Why ? Technically, I think even it’s a grid-tied system, solar panels generate their own power, why we can’t use it. Assuming this is something that the monopoly wants to control, we probably need a system that automatically tie (to sell) and untie (to use). It would be nice.

    Think about someday, every single house has its own solar power system, we maybe able to share electricity through the network…just like the internet…

  46. kevin says:

    Does anyone know if churches qualify for the 30% tax credit or are there any other incentives for churches?

  47. Dave says:

    Looking to install a 5 KWH system in Plano, but I’m wondering what effect coming (maybe) federal laws might have or if I’m looking at only the IRS “30%” thing. TXU utilities seems to be totally ignorant on the subject..

  48. Murray says:


    There will continue to be much confusion on this issue until the IRS finally issues their REG’s on this matter. This may take a while as some states have gotten to be very creative in their promotion of Solar with Paid-In-Tariff’s, Grants, State Rebates, State Credits over multiple years. I have discussed this matter with a couple of my contacts at the DOE and it could be several months before all these issues have finally been addressed in the first draft with probable multiple clarifications to follow because of the complexity of the law / issue itself.

    I advise our dealers to provide clients with this background when explaining the 30% Federal Credit and to be on the conservative side until the IRS regulatons finally come out.

  49. kevin says:

    There seems to be much confusion about how the federal and utility rebates are applied. Some web sites show the federal tax rebate as (cost – utility rebate) * .3, while others show it as cost * .3. Which is correct?

  50. MINS says:

    do any of you know any websites with people who had tried unsuccessfully to use ‘green power’ or solar power if know plz comment.

  51. Dan Hahn says:


    Thanks for the link, we’ll be on it once this bill gets signed and we get a little more info!

    – Dan

  52. Murray says:

    Our company has installers in many Texas Markets.

    Texas is about to move up to at least a 4 star if not a 5 star once this bill is signed by Gov Perry. As a 30% rebate, 500 million will install alot of solar systems in Texas.

  53. Dan Hahn says:


    Thanks for your question and your real estate work. Appraisers are still getting their act together on this one and they may vary a bit from one to another, but according to The Appraisal Journal, home value increases by about $20 for every $1 reduction in annual utility bills. Said another way, solar energy adds 20 times yearly energy savings to resale value.

    Regardless, as I think that 20x multiplier is actually a little conservative. Solar panels are guaranteed to be producing at at least 80% of their capacity at year 25. They’ll actually be working for 40 to 50 years. However, your utility prices aren’t going anywhere but up. The 20x multiplier doesn’t even take that into account. The more your electric rates go up, the more valuable your investment becomes because you’re offsetting that much more power with your own power.

    Hope that helps,

    – Dan

  54. Lydia says:

    I’m looking forward to the increasing affordability of solar power in our state. As a Realtor, I’d like to know where you get the statistic about a home value rising 20x the annual electric bill savings. I sell a lot of homes and have never heard of this kind of increase in property value. Is there something to back this up?

  55. Dan Hahn says:


    Great name BTW. It seems as though your heart and head is in the right space. I recommend networking into business groups where there is venture capital flowing. I’m not sure who is involved in Texas, though I wish you the best of luck!


    – Dan

  56. Dan says:

    To whom it may concern, I would like to help people with renewable energy and reside in Texas. I have been working towards openning people’s eyes in the US but in Texas potential funding resources that would help to get this concept off the ground have made their fortune in fossile fuel with no intention of deviating from this. Do you have any ideas or suggestions on how to go about raising startup funds for a organization geared towards making newable energy affordable to everyone including the poor with an opportunity of freedom? I have not been evolved in non-profit organizations but my heart is into the renewable energy cause as a movement towards freedom for people whom want to be free from reliance on something else to provide them what they need farely. Thank you very much in advance. Dan

  57. Sheryl Stedman says:

    I live in Magnolia. What companies are coving this area if any? After reading the previous emails I am wondering if all this is too risky for me. I just want to be able to run my air conditioner this summer and pay the bill.

  58. bryan says:

    Contact your legislative officials and demand Texans are allowed to purchase and use solar panels for their homes to save on green house gases. Senate bill 403 bypasses hoa’s to be able to install the panels.

  59. bryan says:

    its about time for everyone to get smart on energy and the monopolies wont turn this over to the consumer without a fight . you see millions of dollars are going to be lost when this happens. Finnally the little people will get a break on energy prices. After all to be a competative market all sources of energy should be allowed to compete> thats my 2kws

  60. Cindy says:

    We are starting a company that installs solar for pool heating in Dallas. I am wondering if there is any legislature yet that prohibits homeowner associations from denying a homeowner the right to install the panels on roof?

  61. Dan Hahn says:


    Thanks for your local Austin expertise! We’re sure all our readers appreciate it.

  62. JR says:

    Compiled Q&A thus far:
    Q Gary: What rebates target Houston?
    A JR: 30% Federal rebate

    Q John: How do i contact the PG&E Solar division about employment?
    A David:

    Q Kathy: What rebates target Fort Worth?
    A JR: Encore is offering a ~$2.40/Watt rebate in 2009

    Q TGR: How well do panels hold up horrible Texas hail?
    A JR: Solar panels are rated to take 1” hail at 95 mph. They protect your roof.

    Q QDI: What is the payback period?
    A JR: Green City Solar LLC ( offers an instant payback financial model in most Texas rebate markets. In federal incentive only markets, payback is 25-30 years.

    Q Rose: Why does Austin have the best incentive?
    A JR: Austin Energy is a publically owned cooperative with an overcapacity demand. Residents successfully lobbied AE to introduce a solar incentive program instead of building a new utility plant, after a professional study argued the cost, national security, and environmental impacts justified the program. This leadership has attracted a large scale solar manufacturing plant (Heliovolt) to add jobs to the local economy.

    Q Jim: What rebates target Laredo?
    Q Julie: Also remomber the cost benefit of solar as back-up power.
    A David: If your system is grid-tied, it will go down if the grid goes down.
    A JR: If your system is grid-tied, add a battery back-up system to prevent power outages.

    Q Brandy: I live in Houston. How am I saving money?
    A JR: You aren’t. In terms of cold, hard cash flow in non-rebate markets, it takes 25-30 years to justify system ownership. Wait until mid-2010 to buy a system, prices will dramatically drop. *NOTE* rebate customers should NOT wait for the price drop as the rebates will go away and they will end up paying MORE.

    Feel free to email with additional questions.

  63. Mark V says:

    Yes, Brandy, Dan is correct. You can recieve INSTANT increase in the value of your property with a Solar System(PV-electric). For the full value of your cost. Its a great way to hedge on the increasing cost of fuel/electric prices. Depending on the size of your home, Solar system, power usage and energy efficency level. It can take as long as 25 years or as short as 5 years to recoup your costs. BUT as of next week JAN 1 2009. We will be able to take a federal tax credit of 30% with out the $2000 limit. So a 3000 watt solar system ($30,000)- $9000=21,000 will produce about $3000 of electricity …not too bad. And its the right thing to do.

  64. Dan Hahn says:

    Hi Brandy,

    The best way to determine if solar is worth it for you is to get an evaluation and an estimate from a licensed contractor. An easy way to do that is to click the link at the top of the page.

    Keep in mind, your home value will immediately increase by 20x your annual electricity savings once you connect your solar panels to the electricity grid. As the cost of electricity continues to rise, so does your property value. Added bonus = your property value increase is tax exempt.

    When you say “small 1000 package” what are you referring to?



  65. Brandy says:

    If installation for a small 1000 package with Houston Renewable Energy is 12,000 dollars and the rebate is only 2,000 dollars per home installation for a one time incentive that expires in December how am I saving money? I’m worried that if I had to finance the installation I would wind up paying more than my electricity bill. I’m really interested in solar energy, but at the moment I’m not sure if it is cost effective for me.

  66. Hi Julie. If your system is grid-tied, it will go down if the grid goes down. Off-grid systems are more expensive but can be necessary in areas where dropping a new power line can be cost – prohibitive, or you just REALLY NEED to be off the grid for some reason.

    the most cost effective solution is usually to get a grid tied system, and then if power outages worry you, just purchase a generator for $500.


  67. Julie says:

    When thinking about pay-back periods, you also need to consider the convenience of not losing electric power. I have a friend in Houston with a system and he’s one of the few people who didn’t lose power as a result of Hurricane Ike.

    I’ve come home to find my neighbors all standing in the street, talking about not having electricity. One neighbor was locked out of her house because her garage door opener didn’t work. If the outage had lasted longer, they’d have been having dinner at my house as I was the only person on the block with electricity for about two hours.

    As the electric grid in Texas gets stretched thinner and thinner, solar power for backup electricity will start to make good financial sense, even without utility rebates.

  68. Jim says:

    Is there a convenient way to find what the solar rebate would be on a 5KW system installed in Laredo, Texas?

  69. Rose says:

    Why is it the capitol city has the best incentives? Why can’t the rest of the state share in the benefits? We it across the country and world. Help us all get in on saving the world for the future generations!

  70. Steve Krivan says:

    Gary, For Houston there is a state commercial 10% Deduction from profits and/or 100% Deducted from capitol. This is off of Texas Franchise taxes. The Federal Govt offers 30% Tax Credit.
    Residence only get the 20% Federal in Houston. No Utility Cos offer a rebate in Texas except Austin Energy and CPS in San Antonio, which are Municipal Utilities. See my website for all the details on Solar Panels in Texas, Solar Systems in Texas and Solar Rebates and Tax incentives for Solar in Texas. or

  71. GDI says:

    I wonder what the pay back period is for a typical residential installation?

  72. EJ Barron says:

    It appears as if Texas wants to keep us energy dependent on companies which contribute to global warming and increase the air pollution. Coal energy and petroleum based generation plants to our detriment. I could not find out why other states are more forward-thinking than Texas. I thought we were leaders not backward thinking! Given the problems with Enron I’m shouldn’t be surprised…makes me sad to be native Texan.

  73. TGR says:

    How well would Solar panels hold up in the horrible hail we get here in Texas?
    I was considering solar but your information has discouraged me from doing it here. I have Co-op elec & they dont have any poiliy to buy solar from me if I did put it in.

  74. Randal Vidal says:

    why doesn’t GVEC have a rebate on solar electric or hot water installs and why does it not buy the available electric from owners who produce electric and why isn’t there any low interest loans to get the jobs done

  75. Steve Krivan says:

    In Texas, Austin Energy and CPS Energy in San Antonio offer Solar PV Rebates. They are good ones and make it easier and quicker to pay your system off. See for more information. Also write your state reps and State Senator. Ask for a State Rebate for Solar PV Systems like NY, NJ, CA and CO. These states offer excellent state rebates. Not Texas, Yet!

  76. Kathy says:

    Does Fort Worth offer similar options and is solar recommended for this region?

  77. I’d have to say check PG&E’s website? Honestly, sorry but no help here :-(

  78. John says:

    How do i contact the PG&E Solar division about employment?

  79. gary says:

    Need to know how is the rebate available for houston texas

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