June 24, 2022

Texas solar: tax credits, incentives, and rebates

Texas Solar

Texas Solar Incentives

Solar is booming in Texas: As of 2021, there was enough solar in the Lone Star State to power more than 1.7 million homes! But even though solar costs have dropped more than 80% over the last decade, there can still be significant financial barriers for those going solar. However, there are several attractive incentives and programs designed to reduce solar costs for Texans. In this article, you can learn about some of the programs offered in Texas.

Rebates on installing solar panels in Texas

Multiple Texas distribution utilities offer financial rebates for homeowners installing solar panels in their service territories. If you are a customer of AEP, Austin Energy, or CPS Energy, you may qualify for a solar rebate of more than $2,500. Here’s a quick breakdown of each utility’s solar rebate:


Qualifying AEP customers are eligible for a rebate of up to $3,000. AEP uses a tiered system based on system size. Here’s a handy table with the latest rebate amounts:

System Size Rebate Amount
0.001-2.999 kWdc 50 cents per watt
3.0-4.999 kWdc $1,500
5.0-7.499 kWdc $2,250
7.5-30 kWdc $3,000


Austin Energy

Austin Energy offers a rebate of $2,500 to customers who purchase a solar system and pass a solar education course. The solar education course is a great resource for those who want to build their solar know-how and become a more informed buyer. Upon completing the course, you’ll take a short quiz and pick a participating contractor to complete your rebate application.

CPS Energy

CPS Energy offers $2,500 (up to 50% of the system’s total cost) for qualifying home solar systems. Homeowners may also receive a $500 premium for installing local modules. If you go non-local, the rebate is reduced by 25% and you won’t receive the additional $500 premium.

Contact your utility provider for more information about rebates available to you.

Texas solar tax credit 

In addition to cash rebates, Texans can also benefit from solar tax incentives and exemptions that reduce the overall cost of installing home solar.

Property-tax exemptions

If you have a solar system installed on your property, you can apply for an exemption on your property taxes. Under Texas House Bill 2500, the appraisal of a solar system may be exempt from your property taxes. Although property taxes are assessed locally in Texas, you must apply for the exemption through the state’s Comptroller Office here.

Federal Solar Investment Tax Credit (ITC)

The federal solar investment tax credit (ITC) is a great opportunity for Americans in any state - including Texas - to save on solar system costs. Through the ITC, you may be able to claim 26% of the installation cost of your solar system on your tax return. This amount will be deducted from your taxable income, which essentially translates to a 26% discount on your system. Heads up: The solar ITC is set to expire at the end of 2023, so the best time to go solar is now! You can learn more about the federal ITC in this article.

Texas Net metering

Although there is no statewide net metering program in Texas, many municipalities and utility companies offer net metering options for their customers. Through net metering, you can earn credits on your utility bill for the solar energy that you export to the grid. These credits can translate to monthly bill savings!

TXU Energy Renewable Buyback Plan

TXU’s Energy Renewable Buyback Plan is one example of a local net metering program. In addition to providing homeowners with bill credits for their exported solar energy, the program connects participants to other renewable sources to help keep their electricity stay green, even when their own system isn’t producing energy.

Check with your utility provider to learn more about your net metering options.

Ready to go solar and save?

There are many rebate and cost saving opportunities for those looking to go solar in the Lone Star State. Utility rebates reduce the upfront installation cost, tax incentives. With lower cost barriers for solar systems, homeowners of Texas can enjoy the benefits of reduced energy bills, increased energy independence, and a smaller carbon footprint.

Ready to go solar? Contact Enphase to learn more.

LEGAL NOTICE: (c) 2022 Enphase Energy, Inc. All rights reserved. This information is based upon various rules and regulations currently in effect and information available as of May 26, 2022. Such rules and regulations are complex and often change, and results may be different based on particular facts and circumstances. The information herein is general in nature and may not apply to your circumstances, and Enphase is not in a position to assure any particular result. You should seek appropriate professional advice as to how these rules and regulations apply to your situation. Enphase assumes no obligation to update this article in light of new information or on future events.

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