There’s no doubt about it: solar panels can be pricey. Even though solar technology is getting more affordable, and the right solar energy plan could potentially reduce your energy costs, installing panels on your home is no small endeavor.
Thankfully, there are several ways to curb the expenses of installing solar panels in Texas, including a statewide property tax exemption, federal solar tax credit, and local net metering programs.
Interested in cutting costs on your solar installation? Keep reading for Gexa Energy’s guide to Texas solar rebates and incentives.
Tax Incentives for Solar Panels in Texas
Nobody likes paying taxes—especially more than necessary!
These Texas solar panels incentives can ease your tax burden as you reap the many benefits of solar energy.
Federal Solar Tax Credit
Homeowners across the United States have been able to claim the federal solar tax credit since 2006. The current solar tax credit is 30%. Here’s a breakdown of the available credit depending on the timeframe of your solar installation:
The federal solar tax incentive program credit has increased to 30% (from 26%) for installations completed after Dec. 31, 2021, and the 30% credit is sustained until Dec. 31, 2032. The credit will drop to 26% in 2033, to 22% in 2034, and to 0% in 2035 and thereafter.
If you’re thinking about switching to solar energy, now is the time to take the plunge while this tax incentive is still available. Get started by shopping for energy plans from Gexa, powered by renewable energy.
Related: Learn all about Solar Tax Credits
Property Tax Exemption for Residential Solar Panels in Texas
The Texas property tax exemption is another popular solar power incentive for residents of the Lone Star State. According to the Texas tax code, residents can enjoy a 100% exemption on the appraised value of eligible solar, wind, and biomass energy devices.
Why is this important? With this exemption, your property taxes won’t go up due to solar energy, even if your home increases in value. According to a 2019 study, solar panels increased home re-sale values by an average of 4.1%. If you plan to resell your home, you can be confident that you are making a wise choice by adding solar panels.
How Net Metering Could Save You Energy and Money
One interesting fact about how solar panels work is that they often produce more energy than a house consumes at one time. For example, let’s say you have solar panels on your roof, and you work during peak sunshine hours. Even though your home will be using little energy at that time, your solar panels will still generate energy.
When this happens, the extra energy gets sent back to the grid through the utility meter. The meter reports this exported energy to your provider, and if you are signed up for a net metering plan, you will receive credits for the extra energy on your bill.
Gexa offers a Net Energy Metering plan, empowering you to get the most value out of your rooftop solar panels.
What About Solar Batteries?
Another way to manage surplus energy is with a solar battery. A solar battery is connected to your panels to absorb extra energy. You can then use this stored energy as a backup during non-peak hours, so you won’t draw from the grid.
Related: Learn About Solar Energy
Solar Panel Cost Trends and Potential Savings
Solar energy is generally becoming more affordable, with an 85% price drop in modules since 2010. In March 2021, the U.S. Department of Energy (DOE) announced initiatives to slash solar costs by 60% by 2030. And according to the DOE, switching to solar often results in lower monthly energy costs.
FAQs About Texas Solar Power Incentives
Is there a Texas solar tax credit?
No, currently the only available solar tax credit for Texans is the federal one
How do I qualify for the federal solar tax break?
We recommend consulting with a tax professional to determine your eligibility. You may be eligible if you own the solar panel system, and it is an original installation.
Expenses included in the tax credit include the cost of solar equipment, contractor labor costs, and eligible sales taxes.
What is net metering for solar panels?
Net metering is a popular Texas solar incentive program and is offered by Gexa. In essence, net metering subtracts your generated solar energy from your electricity consumption, meaning you only pay for the difference.
Can I finance my solar panels in Texas?
Yes, you do not necessarily need to pay for your solar panel system upfront, since financing lets you pay for the system over time. Because you are still obligated to pay the full cost, you can claim the solar tax credit on a financed solar panel system. However, you cannot get the tax credit if you lease the solar panels.
There are several cost-saving incentives, promising trends, and flexible payment options to ease the costs of choosing solar energy.