Texas Solar Incentives 2026: A Homeowner's Playbook

If you have shopped solar in Texas lately, the advice you get from friends is all over the map. One neighbor swears by a $2,500 Oncor rebate. Another says "the tax credit is gone, forget it." A third is mid-argument with her HOA about a ground mount. All three are partly right.

Texas is a strange, wonderful solar market. It has no statewide rebate program. It has no statewide net metering mandate. And yet it is the number two state in the country for new residential solar installs in 2025, behind only California.¹ The reason is that Texas stacks several quiet-but-powerful incentives on top of very good sun, very high summer electric bills, and a deregulated retail market that forces electric providers to compete for your surplus kilowatt-hours.

Here is the 2026 playbook for a Texas homeowner running the numbers.

What Changed Federally in 2026

Before we get to Texas-specific rules, the federal piece matters. The 30% Residential Clean Energy Credit (Section 25D) expired at the end of 2025 for cash buyers and loan buyers who own their system. That was the headline. But Section 48E (the Clean Electricity Investment Credit) is still in place for third-party-owned systems, which is why you are seeing a wave of 2026 lease and Power Purchase Agreement (PPA) offers in Texas.² Many Texas installers now quote two prices: a cash price without the credit and a PPA where the credit is baked into a lower monthly rate.

The choice between the two is no longer obvious. We have a walk-through of loan vs. lease vs. PPA that applies directly to the Texas market, and the solar savings calculator at energyscout.org lets you run either scenario.

The Texas Property Tax Exemption (Quietly the Biggest Win)

Texas Tax Code §11.27 grants a 100% property tax exemption on the added appraised value of a solar or wind-powered energy device installed on your property.³ In a state with some of the highest effective property tax rates in the country (2.0–2.3% in many Dallas–Fort Worth and Austin suburbs), this exemption is a meaningful, multi-decade subsidy.

Example: a $28,000 system on a home in a 2.1% effective property tax jurisdiction would otherwise add about $588 to the annual tax bill. Over 25 years, that is roughly $14,700 — more than a California SGIP battery rebate in absolute dollars.

To claim it, you file Form 50-123 with your local appraisal district after installation. Most installers include this paperwork as part of the handoff; if yours does not, push back. The deadline in most counties is April 30 of the first year you want the exemption, though late filings are often accepted.

The HOA Protection You Need to Know

If your HOA has sent you a "no rooftop solar" letter, they are almost certainly overreaching. Texas Property Code §202.010 (the Texas Solar Rights Act) prohibits HOAs from banning solar devices outright. They can impose reasonable aesthetic conditions — panel location, roof-color match, ground-mount screening — but they cannot prohibit the system or set rules that would reduce estimated production by more than 10%.⁴

If your HOA tries to block your install, three paths typically work. First, ask the board for the specific section of your deed restrictions they are relying on, then compare it against §202.010. Second, get your installer to provide a shading analysis showing the requested alternative location would cut production by more than 10% (this is often decisive). Third, the Texas Attorney General has issued opinions siding with homeowners in close cases, and several 2023–2025 district court rulings have expanded protections further.

We keep a running state-by-state HOA summary if you want to see how Texas compares to California, Florida, and New Jersey.

Utility Rebates (Where They Exist)

Texas does not have a statewide rebate, but four utility programs are still worth checking in 2026.

Austin Energy offers the Value of Solar Tariff, which credits residential solar production at about $0.0972/kWh (reset annually based on avoided cost). This is not net metering — your entire production is credited at the VoS rate while all of your consumption is billed at retail — but it generally comes out in the homeowner's favor for well-sized systems.⁵

CPS Energy (San Antonio) runs a residential solar PV rebate, though the per-watt amount has stepped down each year. In early 2026 it is roughly $0.25–0.35/W for systems up to 25 kW, subject to annual budget caps. Apply through a CPS Energy–approved installer.

Oncor Electric Delivery offers a solar PV incentive through its TDSP (Transmission and Distribution Service Provider) program. The 2025 program offered $0.40–0.60/W depending on the census tract, with enhanced payments in low-income and energy-burdened neighborhoods. The 2026 program is expected to launch in late spring — check the Oncor Take A Load Off Texas website.

Guadalupe Valley Electric Cooperative (GVEC) and Bandera Electric Cooperative each run small-scale buyback and rebate programs for member-owners.

Most of the other ~70 utilities in Texas do not offer rebates but do offer some form of REP-based buyback plan. Which brings us to the most Texas-specific lever of all.

The REP Shopping Advantage

Texas deregulated its retail electric market in 2002, which means most Texans outside Austin, San Antonio, and the East Texas co-op zones can choose their retail electric provider (REP). If you install solar, you can — and should — shop for a REP with a generous solar buyback plan.

As of early 2026, competitive solar buyback plans include:

Rhythm Energy "Rhythm Rewards" — credits exports at the plan's energy rate, making it effectively 1:1 net metering. Chariot Energy "Chariot Zero" — solar-friendly, no monthly fee, renewable-sourced. Green Mountain Energy Renewable Rewards — 1:1 buyback with a small monthly credit adjustment. Gexa Energy Solar Buyback — pays a per-kWh credit on exports that is usually slightly below retail. TXU Renewable Buyback — similar, with variable terms.

The catch: most of these plans have slightly higher base rates than the cheapest non-solar plan, so the math requires actually running the numbers on your expected export volume. Use the incentive search at energyscout.org to compare plans against your ZIP code and modeled solar production.

What a 2026 Texas Install Actually Costs

Typical turnkey installed pricing for a 8–10 kW residential system in Texas in early 2026 runs $2.50–$3.10 per watt before any incentives. That is below the national average, reflecting competitive installer density in the DFW, Houston, Austin, and San Antonio metros.

Out the door for a typical 9 kW system: roughly $24,000–$28,000 cash, or a PPA at $0.10–$0.13/kWh over 20–25 years. Add a single Tesla Powerwall 3 or Franklin WH battery for roughly $12,000–$15,000 installed; Oncor and CPS incentive programs sometimes include battery adders in certain census tracts.

Winter Storm Uri is still a live memory for most Texans, and the resilience value of a battery is a separate calculation from economic payback. Our FAQ on sizing solar + battery walks through how to estimate it.

Putting the Playbook Together

A workable 2026 Texas strategy looks like this: get three competing quotes (cash and PPA) from installers using Tier 1 panels (Qcells, REC, Silfab, Canadian Solar, Jinko) and name-brand inverters (Enphase, SolarEdge, Tesla); confirm the property tax exemption is filed; shop three REPs for the best buyback plan that matches your expected export profile; and check whether Oncor, CPS, or Austin Energy rebates apply in your census tract.

If your HOA pushes back, cite §202.010 and the 10% production rule.

Run your own numbers using our free Texas solar calculator at energyscout.org. Enter your ZIP code and we will pull DSIRE's current incentive list, estimate production using NREL's PVWatts dataset, and compare PPA vs. cash across a 25-year horizon.

Sources

Footnotes

1. Solar Energy Industries Association (SEIA) & Wood Mackenzie, "U.S. Solar Market Insight 2025 Year-in-Review." https://www.seia.org/us-solar-market-insight ↩

2. Internal Revenue Service, "Residential Clean Energy Credit (Section 25D)" and "Clean Electricity Investment Credit (Section 48E)." https://www.irs.gov/credits-deductions/residential-clean-energy-credit ↩

3. Texas Comptroller of Public Accounts, "Solar and Wind-Powered Energy Device Exemption." https://comptroller.texas.gov/taxes/property-tax/exemptions/ ↩

4. Texas Property Code §202.010, "Regulation of Solar Energy Devices." https://statutes.capitol.texas.gov/Docs/PR/htm/PR.202.htm ↩

5. Austin Energy, "Value of Solar Rate." https://austinenergy.com/green-power/solar-solutions/for-your-home/value-of-solar ↩