Solar Panels in Texas: Cost and Savings

Solar power is a green energy source that can lead to increased energy independence and long-term electricity savings. Solar in Texas is growing quickly, with ideal conditions for solar generation during much of the year. The Lone Star State is an industry leader in solar power generation. It began investing in solar energy in the late 1970s and has become the second-largest generator of solar power in the nation today.

With the rising popularity of residential solar systems, many homeowners are left asking whether solar is worth it. In short, yes. There are many benefits of installing solar panels, from long-term savings to energy independence and environmental factors. With various financing options, solar is accessible for more families than ever before. Texas also offers competitive incentives to help lower the overall installation costs.

You can significantly lower your energy costs by investing in solar panels. Enter some basic information below and we’ll provide an instant, free estimate of solar cost and savings for your home.

Solar panels are measured in dollars per watt, and Texas’s average price per watt is $3.33, according to data from Find Energy. For the state’s average 9-kilowatt (kW) system, the total price amounts to $29,970. With the Residential Clean Energy Credit, you could recoup 30% of the cost of your solar panels on your taxes after purchasing, bringing the average net cost of Texas solar to about $20,979. 

Cost factors for a residential solar system include the size, configuration, type of solar panels, local installation price differences, and more. Depending on the company you work with, you may have the option of financing or leasing your solar panels, which will also affect your overall price tag.

The following table shows a range of solar system sizes and costs at Texas’s average price per watt of $3.33.

Solar panels can be a significant investment, but financial incentives help ease the cost burden. The Residential Clean Energy Credit, formerly known as the Investment Tax Credit (ITC), allows homeowners who install solar panels on their primary or secondary residence to claim a 30% tax credit. There is no maximum limit set on this credit. 

Texas residents may be eligible for other incentives based on municipality. A few solar incentives available to Texas residents include:

Check with your local government and electric company to find out what solar incentives are available in your Texas city. You can also research your area’s available incentives through the Database of State Incentives for Renewables and Efficiency (DSIRE).

Solar incentives in Austin

Austin homeowners are eligible for a $2,500 rebate when they install solar panels on their property. Solar owners must complete a solar education course to qualify. The Austin Energy Residential Solar PV Rebate program can help reduce your overall installation costs while increasing your solar education.

Solar incentives in Dallas

Dallas has a city resolution requiring all new city buildings larger than 10,000 square feet to meet set energy efficiency standards. Solar panels qualify as a renewable technology for this resolution, which can help Dallas reduce its carbon footprint. Homeowners in Dallas may also be eligible for net metering credits, depending on their local electric company.

Solar panel setup

When it comes to getting your solar system set up, there are several types of equipment you’ll need for your solar array to work, including:

• Solar panels: The panels are the most important part of your solar setup. The most common types of solar panels are monocrystalline, polycrystalline, and thin-film. Each type of solar panel comes with unique costs and efficiency.
• Racking and mounting equipment: You’ll need a fixed mount system to keep the solar panel roof installation in place. Ground installations require other mounting equipment. 
• Solar panel inverter: The solar inverter takes the energy from the solar panels and converts it to the correct type of electricity to power your home outlets.
• Battery: Although they aren’t required for your solar system to function, solar batteries provide essential backup power. Solar batteries can store the energy from your solar panels to use when direct sunlight is unavailable or you experience a power outage

Choose Energy can help you get connected to a reputable solar panel company near you. To get started with your free quote, call our solar experts at the number on your screen to explore your solar energy options.

In addition to the savings provided by tax credits and rebates, you can save money on your electric bill when you switch to solar. Electricity is calculated in cents per kilowatt-hour (kWh). The average electricity rate in Texas as of March 2023 is 14.46 cents per kWh. When your home is powered by solar energy, you can avoid the bulk of that cost. Solar power can reduce your electricity bill by 50% or more, depending on electricity rates in your state. 

The average electricity bill in Texas is about $160 per month. Over the course of a year, that adds up to about $1,920. If you initially paid the average Texas solar system cost of about $29,970, it would take about 11 years for your system to pay for itself with electric bill savings. Since solar panels last anywhere from 25 to 30 years, you could save thousands on electricity costs during your solar panels’ lifespan.

One great benefit of solar panels is the potential to achieve more energy independence. Energy independence means you won’t solely rely on the electricity grid to power your home. When you provide your own power with solar, you can achieve a lower monthly electricity bill. It can also make it easier to more accurately predict monthly bills without wild rate swings. 

Texans have seen just how important energy independence can be. In early 2021, Texas suffered a winter storm that left millions of residents without power — with some in the dark for many days. Customers with energy independence during the storm maintained their electricity without paying the exorbitant bills many others faced.

Installing batteries on your solar system can help you reach energy independence by storing excess energy. When the sun isn’t shining, you can rely on the power stored in your solar battery. Other alternatives for energy independence include installing a solar generator system or owning a portable power station for emergencies.

When buying a solar system, it’s important to thoroughly research and shop around for the best solar panels for your home or business. As you shop for your solar system, you will also want to consider:

• Roof angle. The U.S. Department of Energy states that solar panels work best on south-facing roofs with a slope of 15 to 40 degrees.
• Roof condition. You should not install solar panels on old roofs in poor condition. Any necessary roof maintenance or replacement will increase your total installation costs.
• Sun exposure. The more sun exposure your roof gets, the more money you can save on electricity. Remove tree branches or other objects obstructing direct sunlight from your panels for maximum efficiency.
• HOA. Your neighborhood’s homeowners association (HOA) might have rules around a solar system on your property or require approval before installation. Your solar installer can help you navigate potential restrictions.

Call the number on your screen to learn more about solar in Texas and how you can prepare your home to get maximum value from a solar installation.

Installing solar on your home is a big investment. You can buy solar panels up front, take a solar loan, enter a lease or power purchase agreement (PPA), or subscribe to a community solar program. You’ll save the most money in the long run by purchasing your panels. However, other financing options help make solar more accessible to many families who still benefit from electricity savings and green energy. Here’s a breakdown of the pros and cons of each option.

Texas has 617 solar companies operating across the state. You should receive quotes from multiple installers before signing a contract to ensure you’re getting the best deal. Here are some of the top solar installers available to Texas customers to consider during your research:

Traditional electricity generation emits greenhouse gas emissions, contributing to climate change and polluting the air and water. In contrast, renewable energy generation doesn’t emit greenhouse gasses. A green energy source like solar power can sustainably power your home while reducing your carbon footprint and helping the environment. 

Texas is a leader in renewable energy, ranking second in the nation for solar, behind only California. According to the U.S. Energy Information Administration (EIA), Texas is on track to have the most new solar capacity in 2023 — nearly double that of California. And according to the Solar Energy Industries Association (SEIA), Texas is expected to lead the country in solar generation in the next five years. The state anticipates adding an additional 34,324 megawatts of solar power, making Texas a solar energy powerhouse.

Solar installations and production in Texas have increased dramatically in recent years, going from nearly zero solar energy generation in the early 2000s to 17,247 megawatts of solar as of 2023 — enough solar to power nearly 2 million homes. Utilities comprise most of the growth, but residential solar systems have also increased steadily.

Do solar panels save you money in Texas?

Solar panels can save you hundreds of dollars annually on electricity, depending on how much energy you can retain and save. These savings can amount to thousands over a long period of time. Your exact savings depend on the size of your system, how much power your panels generate, and whether you acquire your panels with cash, a loan, or a lease.

How does solar power help the environment?

Solar power can help you positively impact the environment. Traditional electricity generation causes greenhouse gas emissions, contributing to climate change and pollution. But when you use solar power, you largely avoid those emissions and reduce your home’s carbon footprint, helping to preserve our environment.

Is it better to buy or lease solar panels?

When you install solar panels on your property, you can choose to buy, finance, or lease your system. While leasing might come with fewer upfront costs, it will make you ineligible for the federal tax credits that make solar installation attractive. You won’t own your panels or receive free electricity once you’ve paid the system off. Purchasing solar panels is the best long-term financial option.

What percent of Texas energy production is solar?

According to the SEIA, solar power makes up 4.81% of the state’s total electricity generation. However, according to the EIA, the state generates 16% of the nation’s solar power. As the demand for solar power increases, these statistics may rise.

Do solar panels save you money in Texas?

Yes, solar panels can save you money in Texas over the long term. While they require a higher investment, you could save thousands each year on electricity after you break even on the installation cost. 

What is the life expectancy of solar panels in Texas?

Generally, solar panels can last 25 to 30 years, making them an excellent long-term investment in Texas.