Solar Financing in Texas
Lease vs. Buy vs. PPA — Complete financing guide for TX homeowners
Urgent tax credit deadlines
- Section 30D EV credit (up to $7,500) — expires June 30, 2026 (12 days left).
- Section 48E solar ITC safe harbor — construction must start by July 4, 2026 (16 days left).
Going solar in Texas? With electricity rates averaging 14.5¢/kWh and excellent solar resources, choosing the right financing option can save you $26,775 or more over 25 years. This guide breaks down every option available to Texas homeowners.
Avg Rate
14.5¢
per kWh
Solar Resource
Excellent
TX
Typical System
9kW
residential
Payback
~10.3 yrs
estimated
Solar Incentives & Tax Credits in Texas
Texas homeowners can take advantage of the following solar incentive programs:
Federal Solar Investment Tax Credit
30% federal tax credit via Section 48E for qualifying projects (leases, PPAs, commercial) that begin construction before July 4, 2026. The residential ownership credit (25D) expired December 31, 2025.
30% of system cost
Solar Property Tax Exemption
Texas allows a 100% property tax exemption for the appraised value of solar or wind devices (Tax Code Section 11.27).
100% property tax exempt
Oncor / Utility Solar Rebates
Oncor's Residential Solar PV Program and other municipal utilities (Austin Energy, CPS Energy) offer per-watt rebates.
Up to ~$2,100
Property Assessed Clean Energy (PACE)
Texas PACE financing allows property owners to finance solar and energy improvements via a special property assessment.
PACE financing
Net Metering in Texas
Texas has no statewide net metering mandate. Some municipal utilities and cooperatives offer solar buyback programs at varied rates (e.g. TXU, Chariot, Octopus).
✓ Texas offers a property tax exemption for solar installations, meaning your property taxes won't increase despite the added home value.
Compare Financing Options in Texas
See how cash purchase, solar loan, lease, and PPA compare based on Texas's average rates:
Solar Financing Comparison for Texas
Based on 14.5¢/kWh electricity rate and a 9kW system
Cash Purchase
Pay upfront — maximum long-term savings
- Upfront Cost
- $18,900
- Monthly Savings
- $152/mo
- Tax Credit Eligible
- Yes
Solar Loan
$0 down — own the system over time
- Down Payment
- $0
- Monthly Payment
- $185/mo
- Net Monthly
- $-33/mo
- Tax Credit Eligible
- Yes
Solar Lease
$0 down — provider owns the system
- Down Payment
- $0
- Monthly Payment
- $117/mo
- Net Monthly
- $35/mo
- Tax Credit Eligible
- No
Power Purchase Agreement
$0 down — pay per kWh produced
- Down Payment
- $0
- Annual Savings
- $1,134/yr
- Tax Credit Eligible
- No
Estimates based on average Texas (TX) rates and system costs. For a personalized comparison, use our full financing calculator.
Lease vs. Buy vs. PPA in Texas
Buying (Cash or Loan)
Best for: Maximizing long-term savings and home value.
- You own the system and all electricity it generates
- Eligible for the 30% Federal Tax Credit (~$8,100 on a 9kW system)
- Property tax exempt in Texas
- Increases home value by an average of 4.1%
- Highest 25-year savings: ~$26,775
- You handle maintenance (panels need little)
Solar Lease
Best for: Zero upfront cost with predictable payments.
- $0 or low upfront cost
- Fixed monthly payment (no surprise bills)
- Maintenance and repairs typically covered
- Not eligible for tax credits or incentives
- Lower 25-year savings (~$10,575)
- May complicate home sale (lease transfer)
Power Purchase Agreement (PPA)
Best for: Paying only for what you produce, $0 down.
- $0 upfront cost
- Pay a per-kWh rate (typically lower than utility)
- Provider owns and maintains the system
- Not eligible for tax credits
- Rate escalates 2-3% annually (read the contract)
- Lowest 25-year savings of the three options
Solar Financing FAQ — Texas
Is solar worth it in Texas?
Yes, solar is a worthwhile investment in Texas. With moderate electricity rates averaging 14.5¢/kWh and excellent solar resources, a typical 9kW system can offset most of your household electricity usage. The estimated payback period is 10-12 years, after which you enjoy more than a decade of largely free electricity. texas has no statewide net metering mandate is the main policy factor to verify with your utility.
What solar incentives are available in Texas?
Texas residents can claim the 30% Federal Solar Investment Tax Credit (worth $8,100 on a typical 9kW system). The state also offers Solar Property Tax Exemption, Oncor / Utility Solar Rebates, Property Assessed Clean Energy (PACE). Texas offers a property tax exemption, so your property taxes won't rise despite the added home value.
Should I lease, buy, or get a PPA in Texas?
Buying your solar system (cash or loan) maximizes long-term savings and qualifies you for the 30% Federal Tax Credit. On a typical 9kW system in Texas, that's about $8,100 back. Buying yields roughly $26,775 in net savings over 25 years. Leasing or a PPA requires $0 down and includes maintenance, but you won't get tax credits and your 25-year savings will be much lower (around $10,575). If you can afford the upfront cost or qualify for a low-rate loan, buying is the clear winner in Texas.
How much does a solar system cost in Texas?
A typical 9kW residential solar system in Texas costs approximately $27,000 before incentives. After the 30% Federal Tax Credit (~$8,100), the net cost drops to about $18,900. Actual costs vary based on equipment quality, installer, roof complexity, and whether you add battery storage. Texas offers a property tax exemption, so your property taxes won't rise despite the added home value.
Does Texas have net metering?
Texas has no statewide net metering mandate. Some municipal utilities and cooperatives offer solar buyback programs at varied rates (e.g. TXU, Chariot, Octopus).
What is the solar payback period in Texas?
The typical solar payback period in Texas is approximately 10-12 years. With a net system cost of about $18,900 after the federal tax credit and annual electricity savings of roughly $1,644-$2,010 (based on 14.5¢/kWh), most Texas homeowners see full payback within 12 years and enjoy 13+ years of largely free electricity thereafter.
Related Solar Tools
Estimates are based on Texas average rates, system costs, and the 30% Federal Solar Investment Tax Credit. Actual savings vary by installer, equipment, roof, and utility policy.