What Is the Cost of Solar Panels in Texas?

Highlights

• Solar panels in Texas cost about $13,353 to install, but a typical range is $11,140 to $15,640.
• Several common factors that determine the cost of solar panel installation include the size of the system, the type of panels, the brand, the installation company, the cost of labor, and tax incentives, among others.
• Many homeowners opt for solar energy as their preferred source of power since a solar panel system can increase their home’s value, decrease energy costs, and reduce their carbon footprint.
• Any project involving electrical work that directly connects to the utility power source is best left to professionals who are familiar with installation and handling techniques that will ensure the safety of the workers and efficiency of the system.

Installing solar panels can be an effective method to avoid typically high energy bills that homeowners in the sunny state of Texas experience. Because of the abundant amount of sunshine and the wide variety of solar program incentives, Texas is one of the best states for those interested in solar panels for home installation. Depending on their location, homeowners can reach out to Dallas, Houston, or San Antonio solar companies for local solar estimates.

The cost of solar panels in Texas is about $13,353, though cheap solar panels may cost around $11,140 and larger systems can cost up to $15,640. However, the average price of solar panels can vary depending on a variety of factors, especially federal investment tax credits that can reduce the price by about 30 percent. Before starting a solar panel installation job, homeowners are encouraged to learn more about the factors that influence the cost of installing solar panels in Texas.

Factors in Calculating the Cost of Solar Panels in Texas 

The average cost of solar panels in Texas is primarily determined by the size of the system, the type of panels, and the type of roof, as well as the angle and condition of the roof. Other factors that can influence the cost include the purchase method, incentive programs, tax credits, labor rate, permit costs, and the prices set by individual installation companies. Homeowners will want to weigh these factors carefully when putting together a budget for this job.

System Size

The main cost factor for homeowners to consider when budgeting for a solar panel system is the size of the solar system. The size is typically determined by the total amount of kilowatt output per day. Knowing how much power a home uses each day will help homeowners estimate how many solar panels they need to power their house, and thus the size of the system. The more panels that are needed to complete the job, the higher the cost of the installation for the materials and labor.

To calculate the system size based on the number of panels needed, homeowners can divide the total kilowatt hour (kWh) usage for 1 year by an average production output ratio of 1.3. Then they can divide that number by an average of 320 watts (W), which is the average wattage output per solar panel. The average home in Texas uses about 1,132 kWh per month or about 13,584 per year.

Number of panels = system size / production ratio / panel wattage

This calculation provides the following information for Texas solar panel needs:

Number of panels: 13,584 kWh / 1.3 / 320 W = 32.65

This means that the typical household would need at least 33 solar panels to keep up with the demand for energy. Homeowners can work with a solar panel installation company to determine the size of system they need. They can then use the following average costs to budget for their system, though they’ll need to speak with a few solar professionals to receive accurate estimates for their property.

System Size	Average Cost (Materials and Labor)
3 kW	$7,863 to $8,160
4 kW	$10,485 to $10,880
5 kW	$13,106 to $13,600
6 kW	$15,727 to $16,320
7 kW	$18,348 to $19,040
8 kW	$20,969 to $21,760
9 kW	$23,590 to $24,480
10 kW	$26,211 to $27,200

Purchase Method

The way in which a homeowner purchases a solar panel system can also impact the overall cost of the project. An up-front purchase is the least expensive option available, but it may not be feasible for everyone. It’s more common for a homeowner to take out a loan or sign a lease to help pay for the solar panel components and cover the installation costs.

Another option is power purchase agreements (PPA) which may be an option in certain areas and circumstances. This type of financing allows customers to only pay for the actual electricity that the system generates using a predetermined rate, while ownership of the system belongs to a third party. Some homeowners may opt to cash-out refinance their mortgage for the purpose of freeing up investment funds for the solar system.

Panel Type, Brand, and Quality

As with other products, the type, brand, and quality can affect the price. Premium brands will cost more than less popular brands, even if the solar panels are essentially the same. For example, Tesla enthusiasts will find that a Tesla solar roof costs between $60,000 and $150,000—much higher than the average $13,353. And solar shingles cost between $35,000 and $75,000, though their thinner profile is appealing to many homeowners.

Since solar panel roof costs vary widely, homeowners are encouraged to research the best solar companies in Texas to get an idea of the brands and services available, such as SunPower and ADT Solar. However, even products from the same company or brand may differ in quality, so it’s important for homeowners to research the products before investing. Additionally, the cost can fluctuate based on the type of solar panel chosen; these include monocrystalline, polycrystalline, and thin-film.

• Monocrystalline solar panels are the most costly choice, though they are also the most energy efficient. For the materials alone, homeowners will spend between $6,000 and $9,000 for a 6 kW monocrystalline solar panel system.
• Polycrystalline solar panels are the most common option due to the energy efficiency and midrange price. While these panels are a step down in quality from monocrystalline solar panels, homeowners will only need to pay about $4,500 to $6,000 for a 6 kW polycrystalline solar panel system before installation.
• Thin-film solar panels are the least efficient choice and will require more solar panels than average. They are typically installed on industrial or commercial buildings due to the space requirements. The quantity required can offset the savings, so the average price ranges between $4,500 and $6,600 for a 6 kW thin-film solar system.

Roof Type, Angle, and Condition

Another factor for homeowners to consider when looking into solar panels is the roof. The type of roof, the angle of the slope, and the condition will all influence the final price. Simple roof structures that only have one level are relatively easy and safe for installers to work on, while roofs with multiple levels are more challenging for installers.

If a roof has a steep angle, then it will be more difficult for installers to safely secure the solar panels to the roof. Similarly, if a roof is in poor condition, then homeowners may need to budget for additional roof repair costs. The best roofing companies, such as Aspen Contracting and CMR Construction & Roofing, can help homeowners ensure their roof is in top condition to support solar panels.

Labor and Permits

The cost of labor can fluctuate depending on where a home is located. Generally, rural locations will have a lower cost of labor due to the lower demand for solar panel installation, while urban areas will have both a higher demand and a higher associated cost for labor. Additionally, the larger the solar system, the longer it will take the installers to complete the job, which means higher total labor hours. Homeowners in Texas usually pay about $3,300 in labor fees for a 6 kW system.

Also, a homeowner will need to obtain a permit before the solar panel system can be installed. In some cases, the installation company will take care of permit acquisition, although the homeowner will still be responsible for paying for the permit. It’s a good idea to check with the solar panel installation company to determine how this charge will appear on the estimate and final bill.

Installation Company

Texas has significant solar energy production, so it should come as no surprise that there are a wide range of solar panel installation companies for homeowners to choose from when planning this project. However, the cost of the job can fluctuate depending on the specific installation company.

“I recommend that homeowners look for an installation company that has been in business for a while and has a good reputation,” says Will White, a solar application specialist with more than 15 years of experience in the solar industry, currently with Fluke Corporation, which produces test and measurement instruments for solar equipment. “Installers with a long track record will be best equipped to handle even the most complex solar installations.”

Homeowners will want to speak with several local solar panel installation companies, then whittle down the list to about three or four reputable companies. At this point, they’ll want to research and get quotes from each company before making a final decision about which installation company is the best in terms of price, quality, and service.

Company	Average Cost of an 8 kW System
ADT Solar	$20,000 to $25,000
Blue Raven Solar	$20,000 to $22,500
Elevation	$25,000 to $27,500
Freedom Solar	$17,500 to $20,000
Momentum Solar	$20,000 to $25,000
SunPower	$24,000 to $36,000
Sunrun Solar	$20,000 to $25,000

Solar Incentives and Tax Credits

Solar energy is a renewable energy source that can be an effective source of power in many areas of the country. In order to support solar panel installation projects, federal, state, and local governments offer a wide variety of incentive programs and tax credit opportunities.

“In Texas, incentives like tax credits and rebates are also available to homeowners who install solar,” explains White. Homeowners can research local incentive programs or speak with solar professionals about tax incentives. The following Texas solar incentives are available to qualifying homeowners:

• Property tax exemptions from the assessed value of a home solar system.
• Austin Energy’s Residential Solar Photovoltaic Rebate Program, which gives eligible homeowners a $2,500 rebate after the purchase of a solar system and completion of a solar education course.
• CPS Energy Rooftop Solar Rebate, which offers rebates of up to $0.60 per watt of installed capacity for small businesses, schools, and nonprofits.
• Oncor Electric Delivery Residential Solar Program provides rebates to eligible customers who install a solar system with a battery backup.
• Sunset Valley Solar Rebate Program is a first-come, first-serve option that can give eligible homeowners up to $3,000 at a rate of $1 per watt of installed capacity.
• Federal Solar Tax Credit will allow homeowners to reduce their income taxes owed by up to 30 percent of the solar system cost.

Additional Costs and Considerations

Beyond the primary cost factors for this project, there are several additional considerations for homeowners to keep in mind when planning out the budget, including energy audit costs, product warranties, and environmental zoning restrictions. Homeowners are advised to ask the solar panel company about warranties and zoning regulations before starting this project. Additionally, they can check with the local power providers to determine the requirements for connecting with and benefiting from a solar system.

Energy Audit

Solar panel systems can be connected directly to multiple batteries for personal energy storage and use, in addition to being connected back to the electric utility. By connecting the solar panel system to the local electric utility, a homeowner can sell electricity to the electric company and reduce the cost of their ongoing electric bills. During high-production months, some homeowners’ systems produce more power than they consume, resulting in a credit on their electric power bill. This is known as a net metering program.

Even if the electric utility does not offer a net metering program, a homeowner will still need to have the system audited by the power company to ensure that it is safely set up. Generally, the local utility company will charge a small fee that ranges from $25 to $500. Typically, the solar panel installation company will schedule the energy audit, although homeowners will want to clarify the responsibility for this part of the project before starting the job.

Warranties

A warranty is intended to protect the investment of the homeowner in case of unforeseen circumstances. For instance, Texas homeowners often experience severe weather systems that can cause extensive damage to their homes. A warranty may be able to cover the cost of replacement or repairs to a solar panel system after a severe storm has passed through the area.

However, it’s important to note that a warranty may come with an increased cost, so homeowners will want to speak with the installation company to determine the best product and warranty for their area. The account representative can provide the homeowner with information on warranty terms and coverage options.

Local Regulations

In some areas, changing the appearance of the yard or the exterior of the home requires approval from local homeowners associations (HOAs). However, solar systems aren’t subject to HOA approval since Texas property code forbids HOAs from restricting a property owner from installing solar panels.

Additionally, residential solar installations in Texas do not require special zoning, although the homeowner or the solar panel installation company will need to get a building permit from the local permit office first.

Benefits of Choosing Solar Panels in Texas

Installing a solar system is a costly investment, so before hiring a company to complete this job, homeowners can evaluate the benefits of a residential solar system. Having this information will make it easier to decide if solar panels are worth it in Texas. “[Homeowners will want]to assess the economic feasibility of solar, which differs based on various factors, including electricity bill savings (determined by local energy rates), local and federal incentive programs, projected system lifetime, and available financing options,” advises White. “Based on an analysis of these factors, homeowners can determine the payback period and return on investment.”

Decreased Energy Costs

One of the primary advantages of solar energy for homeowners is the reduced cost of energy bills. Solar panels absorb energy from the sun and convert it into usable electricity. The electricity that isn’t immediately used in the home can be stored in batteries for future use or sold back to the utility provider.

Using the energy generated by the solar panel system reduces the amount of power the homeowner needs to purchase from the local utility, leading to lower electric costs for the entire home. If the utility has a net metering program, the homeowner can sell any unused power back to the utility company for a reduced power bill.

Increased Energy Independence

Typically, a solar panel system does not put the entire home completely off-grid. While it is possible to install an off-grid system that is disconnected from the local electric utility and electric infrastructure, off-grid systems are costly due to the number and size of the batteries that are required to store the generated electricity.

“Homeowners who install solar-plus-battery systems get additional benefits,” explains White. “Batteries allow homeowners to store excess solar energy for later use, such as backup power during a grid outage. It may also amplify the ability to reduce costs.”

Instead, most solar panel systems remain connected to the local electric grid to consume power at night or during periods of lower solar energy production. During periods of high solar energy production, the home can rely on the solar panel system for power, reducing the dependence on the local utility system and minimizing the impact on the electric grid.

Reduced Carbon Footprint

Solar energy is a readily available renewable resource with limited impact on the environment, although it’s more suitable for homes in sunnier locations. Making the switch to solar energy helps homeowners reduce the carbon footprint of the household and also aids the local efforts to reduce greenhouse gas emissions.

Solar energy does not emit greenhouse gases and does not rely on coal or natural gas. However, old solar panels and used equipment can be difficult to recycle, and only about 10 percent of all solar panels are recycled at the end of their lifespan. Still, the greatest benefit is the reduced carbon footprint made possible by harnessing solar energy for everyday use.

“Off-grid houses are typically designed to use significantly less energy than the typical grid-connected house,” says White. “This strategy of energy efficiency allows for a smaller off-grid solar system. There is now solar inverter technology available that allows a homeowner to have an on-grid solar-plus-storage system that can switch to off-grid operations when there is a grid outage, thus being able to benefit from both net-metering and energy independence. In most cases, it isn’t financially viable to take a grid-connected house off-grid, but this may change over time as technology improves and costs come down.”

Increased Home Value

Homeowners who invest in a solar panel system enjoy an increase in the overall value of their home. For anyone trying to make upgrades prior to selling the home, having an existing solar panel system to generate energy and keep utility bills low is an effective way to improve the home’s value and make the property more appealing to prospective buyers.

The impact of this upgrade on the home value depends on the location of the home, the general popularity of solar panel systems in the area, and the associated cost to maintain the solar panel system.

Solar Panel Installation: DIY vs. Hiring a Professional 

There is a wide variety of home improvement projects that an experienced DIYer can handle without needing to hire a crew of professional installers. However, solar panel installation is not one of these projects. Any work on a roof comes with inherent risks and the potential for future leaks if the job is done improperly.

Working on roofs is dangerous, especially without the proper training, supervision, and equipment. Additionally, the type of roof, the slope of the roof, and the condition of the roof need to be assessed in order to put together a plan for the job. Otherwise, even if the panels are installed correctly, they may not work as efficiently as possible, which can lead to energy loss.

“[Issues] may arise during installation, like inadequate structural integrity of the roof that would need reinforcement or problems with the electrical system that require upgrades,” explains White. “Reputable professional solar installers are best able to identify these issues before installation. [Additionally], installing solar can be dangerous, so best to leave it’s to the professionals. Professional solar installers are trained in OSHA safety requirements, ensuring they use equipment like fall protection when on the roof or electrical safety equipment when working on energized systems.”

Solar panel installation is not a job for an untrained person who is unfamiliar with best practices for ensuring the panels are installed optimally and without damaging the roof. Professional installers are experienced and know how to stay safe while working with electrical equipment on a roof. These trained professionals will also be able to inspect the roof, assess the best location for the placement of the solar panels, and install the solar panels in the most effective position for the home. Homeowners can ask one of the best solar panel cleaning services about ongoing maintenance plans to keep their panels working properly throughout the year.

How to Finance Solar Panels in Texas

There are many ways to pay for solar panels in Texas, which makes it easier for homeowners to hire an installation company and invest in this energy upgrade. Homeowners can consider the type of financing and payment methods available before deciding if a solar system is the right choice for their home.

Full Purchase

Taking out loans, signing leases, or looking into a home equity line of credit are viable purchase options for homeowners when the cost of the solar panel system installation is beyond the current budget allowance. However, if funds are available, then the most cost-effective option is to pay for the system up front. The homeowner will then own the solar power system outright and will avoid paying monthly interest fees on loans or leases.

Loan

Getting a small loan is the most common option homeowners use when purchasing a solar panel system. Banks, solar loan providers, and some solar panel companies may offer one of the best solar panel loans to prospective customers. As with any loan, homeowners are advised to thoroughly research the company and terms being offered to ensure it meets their financial needs and goals. Many solar panel loans are offered with term lengths of 24 months to 21 years.

Lease

A lease is another option homeowners have for investing in a solar panel system. Under a lease, homeowners do not own the solar panel system—they are essentially renting it from the solar system provider. The provider will install the equipment, then charge the homeowner a fixed monthly fee according to the terms of the lease agreement.

Typically, a solar lease contract lasts for 10 to 20 years, and the provider is responsible for all maintenance and upkeep. Once the lease is up, the homeowner can choose to renew the lease agreement, purchase the system, or end the lease agreement. Homeowners can consult with a professional financial adviser over any terms and agreements for a lease.

Power Purchase Agreement

Similar to a lease, a power purchase agreement (PPA) allows homeowners to benefit from a solar panel system but without owning the solar panels. This means that when the contract term is complete, the homeowner can choose to renew the PPA, purchase the solar panels, or have the solar panel system removed.

A solar system provider will design and install a solar panel system for the home with little to no up-front cost for the homeowner. Instead, the homeowner agrees to pay a fixed price to the solar system provider based on the amount of electricity generated. Power purchase agreements can be complicated, so homeowners will want to speak with a PPA expert to assess the contract before agreeing to the terms.

Home Equity Loan

Another finance option is a home equity loan, which allows a homeowner to borrow money against their home’s equity. This means that if the home is partially or fully paid off, the homeowner would take a loan based on the value of the home. The home value depends on how much of the home is currently paid off, as well as the size, location, and quality of the property.

This financing option is generally more cost-effective than a traditional loan because home equity loans tend to have lower interest rates. Lenders such as U.S. Bank or Flagstar Bank can help homeowners work through financing options using some of the best home equity loans.

Cash-Out Refinance

A cash-out refinance is similar to a loan in that it borrows against the value of the home. However, instead of a homeowner taking out a second loan against the home, cash-out refinancing allows the homeowner to entirely replace the existing mortgage with a new loan. The new loan is typically for more than the original loan, and the difference is paid out to the homeowner in cash.

The homeowner can then invest this money to pay for a solar panel system installation. Cash-out refinancing can come with a lower interest rate than a home equity loan. With this in mind, it’s recommended that homeowners speak to a financial adviser to determine if cash-out refinancing from one of the best mortgage refinancing companies (such as PNC Bank and Caliber Home Loans) is a suitable option.

How to Save Money on the Cost of Solar Panels in Texas

On average, the cost of solar panels in Texas ranges from $11,140 to $15,640, which breaks down to a solar panel cost per watt of $2.72. Regardless of price, homeowners often look for ways to save money on solar panel system installation costs. Before hiring one of the best solar companies, homeowners can take into account several methods for saving money on solar panel costs.

• Get multiple quotes. Homeowners can research at least three reputable companies in the area and get quotes for the work to compare the costs and services.
• Choose the minimum output and size. Opting for a smaller, less expensive solar panel system to help reduce the cost of the project can reduce overall costs.
• Plan the project for the offseason. Typically, solar panel installations take place during the warmer months of the year. Homeowners may be able to get a discount if they plan the job in the cooler seasons.
• Consider leasing or financing options. Instead of paying the entire cost up front, homeowners can look into leasing or financing options to help pay for the installation.
• Look into solar energy incentive programs. There are a range of incentive programs and tax breaks available for those who are interested in solar energy. This is an effective way for homeowners to get money back after installing a solar system.

Questions to Ask About Solar Panel Installation in Texas

Texas homeowners are encouraged to become more familiar with the installation process by asking solar installers several important questions.

• Are you licensed, bonded, and insured?
• Do you carry workers’ compensation coverage?
• Do you have any available references?
• Can I see a portfolio of past projects?
• Is my home suitable for solar panels?
• What conditions are optimal or necessary for a solar system that can produce enough power for my home’s usage?
• How long will installation take?
• Can I get a cost estimate for the project?
• Do you offer any warranties or guarantees?
• What are the long-term savings for installing a solar panel system?
• How will installing solar panels impact my home’s value?
• How does a solar system generate electricity?
• How much power can I generate with solar?
• How long will solar panels last?
• How do you clean solar panels?
• Are there any specific design or aesthetic considerations for solar panel installation?
• How can I find incentives and tax breaks for solar panel installation?
• What are the environmental benefits of solar?
• Will a solar system produce enough energy to handle all my electric needs?
• How will I know if the system is working?
• What happens during an electrical outage if the solar system is connected to the grid?
• Can I add battery back-up? If so, how much will that cost?
• Do the batteries come with warranties?

FAQs

Residential solar panels can be a great way for homeowners to reduce the cost of utility bills in Texas. The state has several incentive programs that can help cover the solar panel price for the project. However, it’s important for homeowners to learn more about solar electricity and solar panel systems before investing in this energy upgrade. Homeowners can read through several answers to frequently asked questions about solar panels.

Q. How long does it take to pay off solar panels in Texas?

On average, it takes about 10 to 11 years to pay off solar panels that are purchased through a loan or lease agreement. However, it depends on the size of the solar system and the loan terms. Smaller systems will cost less, allowing the homeowner to finish paying off the solar panel installation at a faster rate.

Q. Is it worth going solar in Texas?

Before looking into solar companies in Texas, it’s worth considering whether installing solar panels is worth it. Homeowners typically enjoy reduced energy costs, though the effectiveness of the system may be limited by tree shade, climate, and the roof orientation and tilt. Homeowners can weigh the benefits versus the costs while consulting with Texas solar installers to determine if this is the best choice for their home.

Q. What incentives are available for solar in Texas?

Solar panel pricing can be daunting to decipher, so it’s a good idea for homeowners to look into local incentive programs offered by the state, local utilities, and local government. For instance, Austin Energy offers a rebate of $2,500 on top of paying the homeowner $0.097 for every kilowatt hour the solar panels generate.

There may also be federal programs that offer incentives through tax credits. A quick internet search for “solar panel tax credit in Texas” or “no-cost solar program in Texas” can give the homeowner a list of additional incentive programs offered in the state of Texas.

Q. Is it possible to get free solar panels in Texas?

While finding free solar panels in Texas is not likely, there are incentive programs that can help homeowners with the cost of solar panels and reduce the overall price. Some companies may offer a no-interest payment period or financing without a down payment, but ultimately the homeowner will still need to pay for solar panels.

Sources: Market Watch, EnergySage, Texas Solar Energy Society, Energy.gov, Forbes, Technology Review, Austin Energy, EcoWatch