The Latest Guide For Texas’ Excellent Solar Incentives
“Everything is bigger in Texas,” and so are the solar incentives! One of the best places to invest in solar is in the Lone Star state, with an average of 230 to 240 sunny days per year. Suffice to say, there’s plenty of sunlight wherever you are in Texas. As such, many homeowners and businesses look to take advantage of Texas’ abundant sunlight by investing in new solar panel systems. Best of all, Texas’ federal, state and local solar incentives make adopting solar one of the most energy-conscious and cost-effective decisions you can make.
Inflation Reduction Act
The Inflation Reduction Act approved in 2022 included a significant revamp of the Investment Tax Credit (ITC) for solar energy, now called the Residential Clean Energy Credit. Prior to this law, some of the federal tax credit programs for solar were being gradually eliminated. Nevertheless, the Inflation Reduction Act renewed the value of the country’s solar tax credit program for a span of 12 years. The law allows individuals who install new solar panels to receive a tax credit equivalent to 30% of the installation cost. This credit will be valid until 2033, after which it will gradually decrease to 26% in 2034, 22% in 2034, and ultimately expire in 2035.
Net Metering Programs
Unfortunately, Texas lacks a full-scale net metering program run through the state. However, that doesn’t mean net metering isn’t available for solar producers! Many of Texas’ primary utility companies continue to offer excellent net metering programs and benefits, including El Paso Electric, CPS Energy, Green Mountain Energy and more. Here’s how net metering works:
- As your solar panels convert sunlight to electricity, the power your property doesn’t use is returned to the local energy grid.
- The energy sent to the grid is then redispersed to other homes and businesses in your area.
- Based on the amount of extra energy your produce, your local utility company will compensate you through energy credits and money savings on your monthly energy bill.
- For days when solar production is less than the energy used by your household, your home’s energy systems draw on power from the grid. As long as you’ve earned extra energy credits from previous days of solar production, you won’t need to pay for the energy you “borrow” from utility companies.
After an ideal month of solar energy production, you’ll only pay your utility company for net usage, which is the difference in energy produced by your panels and energy used from the grid. Solar producers often find they drastically reduce and sometimes eliminate their energy bills through net metering programs!
Tax Exemptions
As the primary solar incentive Texas offers, their property tax exemption is hard to beat! Whether you’re a new solar adopter or a long-time producer of solar energy, you won’t pay any extra in property taxes. Solar producers won’t see their property taxes rise due to property value increasing with the addition of solar panels.
Local Incentives
Some of Texas’ best solar incentives and programs can only be found locally. As previously mentioned, most Texas utility companies offer some form of net metering program for residents. Additionally, solar rebates are only available through specific city governments and local municipalities. For example, in Austin, TX, residents can receive a rebate of $2,500 when switching to solar. Austin Energy’s Value of Solar Tariff also pays solar producers $0.097 for every kWh of energy your panels generate. Many of these same or similar programs can be found throughout Texas’ vibrant and sunny communities.
ADDITIONAL SOLAR PROGRAMS
While West Bay Energy can cover Texas solar incentives in broad strokes, there are simply too many for us to discuss here! Dozens of electric co-ops and municipal utility companies in the Lone Star State offer unique solar programs and incentives to homeowners and businesses nearby. To find some of these solar programs in your area, visit the Database of State Incentives for Renewables & Efficiency or call West Bay Energy!