Solar resource
Your solar production in Houston
4.82 avg peak sun hours/day
Monthly avg solar radiation (kWh/m²/day) — Austin, TX. Bars update to show estimated kWh production when you use the calculator above.
Utility rate
CenterPoint Energy service area (ERCOT deregulated) electricity rate
$0.13/kWh residential
- Utility
- CenterPoint Energy service area (ERCOT deregulated)
- Residential rate
- $0.13/kWh (blended)
Houston is in Texas's deregulated electricity market (ERCOT). Retail rates vary by provider (Constellation, Reliant, TXU Energy, etc.) and plan type. The $0.130/kWh figure reflects a typical fixed-rate residential plan. Competitive rates can range from $0.10 to $0.17/kWh. There is no standard utility-wide net metering — each Retail Electric Provider sets its own solar buyback rate (typically $0.03–$0.07/kWh for exported energy under available buyback plans).
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Incentives
Available solar incentives in Houston, TX
Federal + state + utility
| Incentive | Type | Value | Scope |
|---|---|---|---|
| Federal Solar Investment Tax Credit (ITC) | Tax Credit | 30% of system cost | Federal |
| Texas Solar Property Tax Exemption | Exemption | 100% of added home value from solar | State |
| REP Solar Buyback Programs | Net Metering | Varies by provider — typically $0.03–$0.07/kWh for exported energy | Utility |
Incentive amounts and eligibility rules change. Verify current terms with your installer and a tax professional before installation.
System cost
Cost breakdown (6 kW default)
- Gross system cost
- $17100
- Federal ITC (30%)
- −$5130
- Net system cost
- $11,970
- Installed cost per watt
- $2.85/W
Lawrence Berkeley National Laboratory Tracking the Sun 2024 — Texas median installed cost for systems 3–10 kW
Payback & long-term value
25-year outlook
- Annual savings (yr 1)
- $1,051
- Simple payback period
- 11.4 years
- 25-year net savings
- $14305
- Assumed annual rate increase
- 2.5%/year
25-year estimate uses flat electricity rate for conservative baseline. Accounting for 2.5% annual rate increases, lifetime savings increase substantially.
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How it works
How solar savings work in Houston
- Your panels capture sunlight Solar panels convert sunlight into DC electricity. Houston averages 4.82 peak sun hours per day — strong production year-round thanks to the Gulf Coast's long sunny seasons, with peak output in the June–August summer months.
- An inverter converts DC to AC A solar inverter converts the DC power from your panels into the AC electricity your home uses. Modern string inverters and microinverters achieve 96–99% conversion efficiency.
- You use solar power instead of buying from the grid Every kilowatt-hour (kWh) your system produces during daylight reduces what you buy from your Retail Electric Provider at approximately $0.130/kWh. A 6 kW system produces about 8,082 kWh/year in Houston — enough to offset most of a typical home's usage.
- Excess power flows back to the grid via your REP When your panels produce more than your home uses, excess electricity flows to the ERCOT grid. In Houston's deregulated market, your Retail Electric Provider (REP) sets the buyback rate — typically $0.03–$0.07/kWh. Choosing a REP with a competitive solar buyback plan can meaningfully improve your return.
- You claim the federal tax credit In the tax year your system is installed, you claim a 30% federal tax credit on the full installed cost. On a $17,100 system, that's $5,130 off your federal income taxes — reducing your net cost to $11,970.
- Your savings grow over time As retail electricity rates rise (historically ~2.5%/year in Texas), your solar savings increase while your system cost stays fixed. Over 25 years, a 6 kW system in Houston nets roughly $14,300 after repaying the installation cost.
FAQ
Common solar savings questions for Houston, TX
How much can I save with solar panels in Houston, TX?
A 6 kW system — typical for a Houston home — produces about 8,082 kWh/year and saves approximately $1,051/year at a typical retail rate of $0.130/kWh. After the 30% federal tax credit, the net system cost is around $11,970, with a payback period of about 11–12 years and 25-year net savings near $14,300. Houston's high summer air conditioning loads make solar particularly valuable from May through September.
How does solar work in Houston's deregulated electricity market?
Houston is served by CenterPoint Energy for electricity delivery (wires and poles), but you choose your own Retail Electric Provider (REP) for generation. REPs such as Constellation, Reliant, TXU Energy, and Green Mountain set their own solar buyback rates for excess energy you export to the grid. Rates typically range from $0.03 to $0.07/kWh — lower than what regulated utilities in other states offer. Comparing REP solar plans before going solar is an important step.
Is there a state solar incentive in Texas?
Yes. Texas Tax Code §11.27 exempts 100% of the appraised value added to your home by a solar installation from property taxes. On a typical Houston solar installation, this can avoid $300–$500 per year in property taxes. Texas does not have a state income tax credit for solar, and Houston has no city-level solar rebate program as of 2026.
How much does a solar system cost in Houston?
A 6 kW system in Houston costs approximately $17,100 before incentives ($2.85/watt installed, per Lawrence Berkeley Lab 2024 data for Texas). After the 30% federal Investment Tax Credit ($5,130), the net cost is about $11,970. Prices vary by installer, equipment tier, and roof complexity. Houston has a competitive installer market, so getting 3–4 quotes is recommended.
Does Houston get enough sun for solar panels to be worth it?
Yes. Houston averages 4.82 peak sun hours per day annually — strong solar irradiance driven by long summers and generally clear skies. While the Gulf Coast sees more cloud cover than inland Texas cities like Austin or Dallas, solar production is still excellent by national standards. Houston's high electricity consumption (especially for summer AC) means more energy to offset, making solar financially attractive.
How many solar panels do I need for my Houston home?
A typical Houston home using 1,200–1,500 kWh/month (higher than the national average due to summer AC demand) needs a 7–10 kW system. A 6 kW system works well for a smaller home or one with efficient HVAC. Use the calculator above to enter your monthly bill and get a system size tailored to your usage.
Sources
Data sources and freshness
- https://pvwatts.nrel.gov/
- https://openei.org/apps/USURDB/
- https://www.eia.gov/electricity/data/browser/
- https://statutes.capitol.texas.gov/Docs/TX/htm/TX.11.htm
- https://emp.lbl.gov/tracking-the-sun
- https://www.energy.gov/eere/solar/homeowners-guide-federal-tax-credit-solar-photovoltaics
- https://dsireusa.org/
- https://www.puc.texas.gov/industry/electric/retail/netmetering.aspx
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Disclaimer: This calculator provides estimates for informational purposes only — not financial or investment advice. Solar savings depend on actual shading, roof orientation, energy usage patterns, rate changes, and equipment performance. Consult a licensed installer and a tax professional before making purchasing decisions. Verify incentive eligibility with official sources. Data last verified 2026-04-13.