Are Solar Panels Worth It In Texas?

Nov 9, 2022 | Renewable Energy

As Texans face higher electricity bills, more and more people are considering investing in a solar power generation system for their homes. Generating your electricity offers many benefits. Not to mention that with over 200+ sunny days every year, Texas is the perfect environment to capture solar power.


However, installing solar panels doesn’t make sense in every situation. If you’re renting, your home isn’t positioned to receive enough direct sunlight. Or if the numbers don’t add up for you, then installing solar panels may not be advantageous. So let’s take a closer look at how, when, and if solar panels are worth it in Texas.


Solar Power In Texas

Solar power has been around for decades, but it wasn’t until recent years that the cost of the technology reached a point where residential installations were viable. And now, solar has taken off. It’s estimated that about 4 million photovoltaic units will be installed in 2023 — and Texas is second in the country for solar installations. 


How Much Does Solar Cost?

As of October 2022, Texas’s average solar panel cost is $2.75/watt. This means that the average cost for a 5 kilowatts (kW) system would be $13,750. Add in installation costs, and Texas homeowners pay an average of $30,935 to install solar panels or $21,654 after the 30% federal tax credit. This is in line with the national average. Contributing factors to the price of solar include the size of the system, the quality and type of the panels, the difficulty in installing on your roof, the labor costs of the individual installation company, and permitting and interconnection fees.


Benefits of Solar Power In Texas

Renewable energy sources like solar power provide many benefits. Installing solar panels on your home can lower monthly bills, reduce your carbon footprint, and minimize your reliance on the power grid. Solar also lets you lock in energy rates for the system’s lifespan. Let’s break it down and look at everything that’s drawing Texans to solar power.


Money Savings

Texas households use an average of 1,132 kWh monthly and pay $132.59. If you can eliminate your electric bills, that saves over $1,500 every year! Keep in mind that most people don’t eliminate their electricity bill. They cut it in half because they still need to use electricity from a retail electricity provider during the nighttime and cloudy days when the panels don’t have sun exposure to generate electricity. Still, those monthly savings add up to about $21,350 over the system’s lifetime.


Taxes & Financial Incentives

A few incentives are available for Texas residents, the biggest being the federal solar investment tax credit. The federal solar tax credit for 2022, also known as the Investment Tax Credit, or ITC, gives homeowners a credit of 30% of the installation cost. Solar panel systems installed in 2023 will be eligible for an incentive of 23%. In Texas, the typical ITC is $9,211, which reduces the average installation from $30,935 to $21,654. Unfortunately, Texas doesn’t have a statewide tax incentive, but many utility companies offer solar installation rebate and buyback programs.


Net Metering

You might have heard that having solar panels lets you become an energy producer and sell your excess electricity to the grid, a concept known as net metering. Texas doesn’t have a statewide net metering program, but some individual power companies do. Energy Texas customers with solar panels can participate in the Sun-Jacinto Solar Buy Back and get paid for power generated from their home’s solar panel system.


Protection From Outages

Solar panels can keep your power on even if the grid gives out. But, again, remember that solar panels only produce electricity when the sun is out, so you’ll have to install a battery backup system at an added cost to maintain power during times of no sunlight.


Disadvantages of Solar Panels in Texas

Solar panels have many upsides, but they’re not right for everyone in every situation. In addition to whether you use enough energy to justify solar panels and if your home even gets the necessary sun exposure, below are a few other factors to consider when you’re thinking about outfitting your home with solar panels.


High Upfront Costs

While Texas is the second most popular state for solar conversions, solar panels aren’t right for every home in Texas. It still costs over $21,000 to install. The time spent recouping costs is the payback period. In Texas, the average solar panel payback period is 13 years. Don’t forget about the maintenance costs as well. The national average cost of inspection and cleaning a 2kW, ten-panel system runs $300–$700.


Moving Before Costs are Recouped

Solar panels are a long-term investment. What if you move out of your home before it pays off? That’s a common issue, with most homeowners moving right around that 13-year mark. You could take your solar panels with you, but that could complicate the selling process and add significant expense.


Not All Deals Make Financial Sense

When you’re evaluating costs, beware of companies that offer “free panels,” bad lease programs, and power purchase agreements (PPAs). These arrangements don’t increase your home value, take a long time to pay off, and don’t allow you the federal solar tax credit. 


Energy Texas Lets You Enjoy the Benefits of Solar Without the Huge Investment

There’s no question that investing in a solar panel system to produce your own clean, green electricity sounds like a great idea, and in some situations, it is a great idea. But it’s not without its caveats, especially the large cash outlay upfront. If you move before the payback period is complete, you might never recoup your investment.


Homeowners who care about the environment will be happy to know that solar energy is available from Energy Texas. Sign up for any of our electricity plans to reduce your carbon footprint, fight global warming, and decrease pollution with 100% renewable energy made right here in Texas. Enter your zip code below and check out the plans we have available in your area.


Additional Frequently Asked Questions About Solar In Texas


Can solar panels survive extreme weather conditions?

Solar panels are made from durable materials that are waterproof and can withstand heat and cold. After all, their very nature is to have the sun beating down on them. Lightning strikes can transmit high voltages into the system breaking down conductors, PV panels, and other components. Surge protection systems can protect against lightning. Contact your insurance provider to determine what your homeowner’s policy covers.


Does going solar save you money?

In most cases, solar panels will save you money, but only if you buy them outright or finance them. The panels will pay for themselves in about 13 years. The remaining 12+ years of your system will save an average of $21,350. Your savings will be lower with a solar loan and nonexistent with a lease or power purchase agreement.


Does solar improve home value?

According to data from Zillow, solar panels increase property value by about 4%. The average home value in Texas is shy of $290,000, which means an increase of nearly $12,000. This is even higher in markets like Dallas, Fort Worth, Houston, and San Antonio. Additionally, homeowners can receive a property tax exemption equal to the appraised value of the solar system.


Can I install my solar panels in Texas?

DIY solar panel installation is not recommended. Working on the roof with electricity is dangerous, and the project is best left to an experienced, reputable installer. Additionally, permits are required to install solar panels in Texas, and most installation companies handle the permitting process.


How long do solar panels last in Texas?

Most manufacturers provide a 25-year warranty. However, the actual lifespan of a solar panel depends on the quality of the panel, the amount of sunlight it receives, how much extreme heat or cold it’s exposed to, and other factors. A properly maintained system can last up to 30 years (or longer).


Recent Posts