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Austin has the best solar deal in Texas. A $2,500 flat rebate, 9.91¢/kWh Value of Solar exports, and a 100% property tax exemption — no other Texas city comes close.
The federal residential solar tax credit (Section 25D) expired December 31, 2025 — but Austin Energy’s local incentives remain the strongest in the state.
2026 Federal Tax Credit Alert: The federal residential solar tax credit (Section 25D) expired December 31, 2025. Austin homeowners who purchase solar with cash or a loan receive $0 in federal tax credits. The Austin Energy $2,500 rebate, Value of Solar rate, and TX property tax exemption are still active. Lease/PPA providers can still access the commercial ITC (48/48E) for projects starting before July 4, 2026.
No other Texas city matches Austin’s combination of utility rebate, export compensation, tax savings, and solar resource. Here is why Austin stands alone.
The only active utility solar rebate among Texas’s major metros. Applied as a bill credit after your system receives Permission to Operate. CPS Energy’s rebate has ended. Houston, Dallas, and Fort Worth offer nothing.
Austin Energy’s Value of Solar rate pays 9.91¢ for every kWh you export — more than double the 3–4¢ that CPS Energy and deregulated utilities typically pay. This is the highest solar export rate of any major Texas utility.
Texas exempts the full value of your solar system from property taxes. In Travis County (1.98% tax rate), a $20,500 system saves ~$436/year in taxes you never have to pay. File Form 50-123 with the Travis County Appraisal District.
Austin Energy’s regulated rates are among the lowest for any major Texas metro. Lower rates mean your solar system competes against a reasonable baseline, and the VoS rate at 9.91¢ captures 83% of retail value for your exports.
Austin receives 5.6 peak sun hours per day on average — higher than Houston (5.3), Dallas (5.4), and the national average (4.5). More sun means more production and faster payback. A 10 kW system produces about 16,800 kWh annually.
Austin Energy is a municipally owned utility, not part of the deregulated ERCOT retail market. This means stable, predictable rates and a reliable solar program — unlike deregulated markets where REP buyback rates can change or disappear.
Everything you need to know about Austin Energy’s residential solar rebate — eligibility, application process, and timeline.
Select a contractor from Austin Energy's approved solar installer list. Get at least 3 quotes.
Your contractor submits the rebate application to Austin Energy on your behalf, including system design and permit documents.
Austin Energy reviews and approves the application. Do not begin installation until you receive written approval.
Contractor installs the system. Schedule and pass City of Austin electrical inspection.
Austin Energy installs a bi-directional meter and grants Permission to Operate (PTO). Your system goes live.
Rebate is applied as a credit to your Austin Energy bill. Typically appears within 4-8 weeks after PTO.
Total timeline: From signing a contract to receiving the rebate credit, expect 10–16 weeks. The installation itself is typically 1–3 days; the rest is approvals, inspections, and utility processing.
Austin Energy uses a Value of Solar tariff instead of net metering. Here is exactly how it works, what you earn, and how to optimize your savings.
Under VoS, self-consumed solar saves you 12¢/kWh (the full retail rate you avoid paying), while exported solar earns 9.91¢/kWh. That means every kWh you use directly is worth 2.09¢ more than one you export.
Electricity you produce and use directly in your home. Displaces a purchase from Austin Energy at full retail rate. This is the most valuable use of your solar production.
Electricity sent to the grid when production exceeds your usage. Credited at the VoS rate. Still valuable — far better than the 3–4¢ paid by most TX utilities.
Optimization tip: Run high-consumption appliances (dishwasher, laundry, EV charging) during peak solar hours (10am–3pm) to maximize self-consumption and reduce exports. Each kWh shifted from export to self-consumption saves you an extra 2.09¢.
| Month | Production | Self-Use | Exported | Retail Saved | VoS Credit | Total |
|---|---|---|---|---|---|---|
| January | 1,120 kWh | 672 kWh | 448 kWh | $80.64 | $44.40 | $125.04 |
| February | 1,260 kWh | 756 kWh | 504 kWh | $90.72 | $49.95 | $140.67 |
| March | 1,540 kWh | 924 kWh | 616 kWh | $110.88 | $61.07 | $171.95 |
| April | 1,680 kWh | 1,008 kWh | 672 kWh | $120.96 | $66.60 | $187.56 |
| May | 1,820 kWh | 1,092 kWh | 728 kWh | $131.04 | $72.14 | $203.18 |
| June | 1,890 kWh | 1,134 kWh | 756 kWh | $136.08 | $74.92 | $211.00 |
| July | 1,890 kWh | 1,134 kWh | 756 kWh | $136.08 | $74.92 | $211.00 |
| August | 1,820 kWh | 1,092 kWh | 728 kWh | $131.04 | $72.14 | $203.18 |
| September | 1,540 kWh | 924 kWh | 616 kWh | $110.88 | $61.07 | $171.95 |
| October | 1,400 kWh | 840 kWh | 560 kWh | $100.80 | $55.50 | $156.30 |
| November | 1,190 kWh | 714 kWh | 476 kWh | $85.68 | $47.17 | $132.85 |
| December | 1,050 kWh | 630 kWh | 420 kWh | $75.60 | $41.63 | $117.23 |
| Annual Total | 18,200 kWh | 10,920 kWh | 7,280 kWh | $1310.40 | $721.51 | $2031.91 |
* Assumes 10 kW system, 5.6 peak sun hours, 60% self-consumption / 40% export split, retail rate 12¢/kWh, VoS rate 9.91¢/kWh. Actual production varies by roof orientation, shading, and weather.
A detailed breakdown of what solar actually costs in Austin in 2026, including the Austin Energy rebate, property tax savings, and payback calculation.
* Assumes constant electricity rates. With typical 3% annual rate increases, actual lifetime savings would be significantly higher.
Section 25D expired Dec 31, 2025. Cash and loan buyers receive $0 federal credit. This adds $0 to your cost vs. the previous 30% credit of ~$6,150 that was available through 2024.
Austin solar costs average $2.05/W installed, competitive with the Texas average of $2.20/W. Prices vary by roof complexity, equipment quality, and installer.
Texas law exempts solar from property tax assessment. Your $20,500 system adds $0 to your tax bill. File Form 50-123 with Travis County Appraisal District.
Without the 25D tax credit, solar loans no longer have a “tax credit bridge” payment structure. Expect fixed-rate solar loans at 5–8% APR for 15–25 year terms in 2026.
While homeowners can no longer claim the federal solar tax credit, third-party companies that own the panels can still claim the commercial ITC — and pass savings to you through lower payments.
The commercial ITC (Section 48/48E) is available for projects that begin construction before July 4, 2026. After that date, the 30% ITC phases down significantly. If you are considering a lease or PPA, starting the process now gives the financing company time to qualify.
The commercial ITC is claimed by the third-party system owner (the financing company), not the installer and not you as the homeowner. Make sure you understand the lease/PPA terms before signing.
| Factor | Buy (Cash/Loan) | Lease/PPA |
|---|---|---|
| Federal Tax Credit | $0 (25D expired) | 30% via owner (48/48E) |
| Austin Energy Rebate | $2,500 to you | May go to owner |
| Upfront Cost | $18,000 net | $0 down |
| System Ownership | You own it | Company owns it |
| Property Tax Savings | ~$436/yr | N/A (you do not own) |
| 25-Year Savings | ~$39,800 | Varies by contract |
| Home Sale Impact | Increases value | Lease must transfer |
Austin and San Antonio are both served by municipal utilities, but the solar programs are dramatically different. Here is a side-by-side comparison.
| Feature | Austin Energy | CPS Energy (San Antonio) |
|---|---|---|
| Utility Type | Municipal (regulated) | Municipal (regulated) |
| Solar Rebate | $2,500 (active) | $0 (program ended) |
| Export Rate | 9.91c/kWh (VoS) | 3-4c/kWh (avoided cost) |
| Export Program | Value of Solar (VoS) | Avoided Cost Buyback |
| Credit Rollover | Monthly rollover, Dec expiry | Monthly credit, no rollover |
| Retail Rate | ~12c/kWh | ~12.5c/kWh |
| System Size Cap | No cap (>25kW needs review) | 25 kW residential limit |
| Property Tax Exemption | Yes (Travis County) | Yes (Bexar County) |
| Overall Solar Value | Best in Texas | Below average |
Austin Energy’s $2,500 rebate, 9.91¢/kWh Value of Solar rate, and no system size cap make it the clear winner for solar in Texas. CPS Energy’s solar rebate program has ended, and their avoided cost buyback rate of 3–4¢/kWh is less than half of Austin’s VoS rate. An Austin homeowner going solar today can expect payback 3–4 years faster than a comparable San Antonio homeowner.
Most of Texas runs on a deregulated electricity market (ERCOT) where Retail Electric Providers (REPs) compete for your business. Here is how Austin’s regulated model compares for solar.
Austin Energy (Municipal)
CenterPoint (Deregulated)
Oncor (Deregulated)
In deregulated markets, some Retail Electric Providers offer solar buyback plans that pay closer to retail rate, but these plans can change terms, have high fixed charges, or be discontinued. Austin Energy’s VoS is a stable, regulated program.
Common questions about Austin Energy solar rebates, Value of Solar, and going solar in Austin in 2026.
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Last updated: February 2026. Solar costs, rebate amounts, and utility rates are subject to change. Austin Energy Value of Solar rate is recalculated annually. Consult Austin Energy directly for the most current program details. Cost estimates assume standard roof-mount installation on a single-story home with composite shingle roof.