Solar incentives in Texas
Federal tax credits, Texas rebates, utility programs, and No statewide mandate (retailer-dependent buyback) net metering - everything that lowers your solar payback.
Incentives & rebates
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Federal Residential Clean Energy Credit (Section 25D) - ENDED
The 30% federal Residential Clean Energy Credit (IRC Section 25D) expired for property placed in service after December 31, 2025, under the One Big Beautiful Bill Act. Homeowners who purchased and installed solar by year-end 2025 can still claim it on their 2025 return. Cash and loan purchases made in 2026 receive no federal tax credit.
Federal Commercial ITC (Section 48E) - via Lease / PPA
Section 48E (the commercial Clean Electricity Investment Credit) survives at 30% and is still available to third-party owners of residential systems under solar leases, PPAs, and similar TPO structures. The TPO company claims the credit and typically passes the savings through to the homeowner via lower monthly payments. To qualify, projects must begin construction by July 4, 2026; otherwise they must be placed in service by December 31, 2027. Foreign Entity of Concern (FEOC) sourcing rules also apply.
Texas Solar Property Tax Exemption (Tax Code §11.27)
Texas exempts 100% of the appraised home value added by an installed solar energy device from property tax (Tax Code §11.27). The exemption is permanent for as long as the system is in place, but you must file Form 50-123 with your county appraisal district to claim it (the deadline for the current tax year is generally April 30).
Local Utility & Co-op Solar Rebates
Several Texas utilities and municipal/co-op providers offer upfront solar or battery rebates and solar buyback plans (for example Austin Energy, CPS Energy, and various co-ops). Availability and amounts vary by service territory and change frequently - confirm current programs with your retail provider.
Net metering: No statewide mandate (retailer-dependent buyback)
Texas has no statewide net-metering law. In deregulated ERCOT areas, compensation for exported solar depends on the retail electricity provider and the specific solar buyback plan selected; some plans credit at near-retail rates and others at lower wholesale-style rates. A few municipal utilities and co-ops offer their own net-metering or buyback programs.
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