Exploring the Cost of Going Solar in Texas: Finding the Best City for Solar Installations

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Last Updated on November 1, 2023 by admin

Exploring the Cost of Going Solar in Texas: Finding the Best City for Solar Installation

As the world’s energy demand is rapidly growing, the search for cleaner and more sustainable sources of energy has become more important than ever. Among these sources, one alternative is solar energy. The solar energy trend is rapidly growing in Texas as a reliable source of renewable energy. Lone star state is one of the best states for solar panel installation in the United States due to the low cost of solar panels in Texas. This is the state with the perfect amount of sunny days. Solar Energy Industries Association (SEIA) states that out of Texan’s total energy mix, 4.81% comes from solar power. Not only this but 1,957,307 households in Texas are currently using solar energy to power their homes.

solar homes

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Important Points To Remember:

  • The main reason why solar energy is gaining traction in Texas is due to its exceptional incentive policies. 
  • The price of PV modules in Texas has seen a steep fall of almost 53% in less than a decade.
  • The average cost of solar PV modules in Houston, Texas, is about $2.71 per watt.
  • Houston is the most populous metropolitan city in Texas and the fourth most populous city in the United States.
  • Solar energy is popular in Austin for three reasons, the availability of the rebate program, the existence of enormous solar farms, and citizens who are aware of taking steps for a clean environment.

What is in this Article:

Is there any Scope for Solar Power in Texas?

With the opening up of businesses after the COVID pandemic, the Texan economy is seeing exponential growth. This will consequently cause the electricity demand to spike in the energy market. With environmental regulation and the looming climate emergency, switching back to fossil fuels is not a wise decision to make. To fill this energy gap, Texas is trying to promote renewable energy. Last year alone, 220 solar installations took place in the state due to the low cost of solar panels in Texas. It is poised to become the leading state in solar power in the United States. In Texas, 4GW of solar installation is about to take place in the next five years. This will eventually lower the initial installation cost of solar panels in the state.

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What is the Average Solar Panel Installation Cost in Texas?

The average cost of solar PV modules in Houston, Texas is about $2.71 per watt. For a 5 kilowatts (kW) system, the price range is from $11,560 to $15,640. However, the average gross price for solar panels in Texas boils down to about $13,600, if we take into account, the 30% federal tax credit as well as the state and local incentives and rebates. The net price to secure your first solar system will take a nose dive by thousands of dollars due to the incentive policies.

average cost in expenditure

The average cost includes all the necessary expenditures like:

  1. Solar panels
  2. Mounting equipment
  3. Inverter
  4. Conduit and other components
  5. Labor cost
  6. Project management
  7. Permitting and inspection
  8. Twenty-five-year warranty which will likely cover the repair and maintenance costs

What are the Factors that can Impact the Cost of Solar Panels in Texas?

One of the primary factors that determine the cost of the solar array in Texas is the type of solar panel technology used. There are two types of PV modules available in the market: crystalline silicon and thin film. Crystalline silicon panels are more expensive but offer higher efficiency rates while thin-film solar panels are inexpensive but less efficient. However, the difference in efficiency between the two types of solar panels is not significant enough to justify the cost difference for most households and businesses.

Another factor that impacts the cost of solar panels in Texas is the size of the solar panel system. The larger the system, the higher will be the cost of PV modules. However, larger PV systems also generate more electricity which can offset the initial cost over time quickly.

What are the Top Cities for Solar System Installation in Texas?

Solar installation trend is rising in South Texas more than ever before. If you want to get involved in the trending action, now is the best time to do it. Below is the list of top Texas states to get your solar voyage to begin. It is important to bear in mind that the federal government offers a 30% tax credit on initial solar system installation, which eventually lowers the installation cost of solar panels in Texas. This tax exemption is about to end in 2034 so make sure to avail yourself of this phenomenal offer before its expiry.

solar system in texas

1. Houston, TX:

Houston is the most populous metropolitan city in Texas and the fourth most populous city in the United States. This state possesses a population of around 2.3 million and an area of about 640 square miles. The amount of sun this state receives sets the perfect condition for a solar system installation. This will ultimately impact the cost of PV modules in Texas.

2. San Antonio, TX:  

San Antonio holds a population of about 1.4 million making the city the second most populous in Texas. It also stretches across 485 square miles in Texas. San Antonio offers a 30% federal tax credit and a property tax exemption on the initial solar installation. Moreover, the cost of getting solar systems is the lowest in San Antonio. There is also the benefit of CPS utility companies. They offer exceptional rebates on solar arrays which have an installed capacity of 25kW or less. This bestows the city with the honor of being the most economical state to get solar panels. Due to all these benefits, a major influx of people into the city has been noted in recent years.

3. Dallas, TX:

The third most populous city with a whopping population of about 1.33 million in Texas is Dallas. At first, solar energy was not a popular way to power up people’s households but as the popularity of solar energy began to increase, Dallas was fast enough to catch up. This was so big of a deal that in 2017, Dallas achieved the second position in terms of solar growth. With almost receiving 234 sunny days annually, Dallas is the perfect place for off-grid solar investment.

Dallas also offers a property tax exemption on the solar-invested property. This means that you are not being taxed for the ginormous increase in the property value which is a pretty good deal to get yourself into. Furthermore, the payback period for the solar system in Texas is about 11 years, which means that after this timeframe you will start earning on your solar PV modules.

4. El Paso, TX:

The hot desert climate of El Paso is perfect for solar power system installation. This is the sunniest city in Texas, the sun shines about year-round. Hardly a day goes by when the clouds take over the sun. The cherry on top of this is the city supports net metering which means that you will be able to sell back the excess electricity generated by your solar systems. So, long story short, you can cash out on every extra kilowatt of electricity that your  PV modules will generate.

5. Austin, TX:

With almost one million population, Austin is the fourth most populous state in the United States. Solar energy is popular in Austin for three reasons:

  1. The availability of the rebate program: This will lower the initial cost of solar PV modules in Texas.
  2. The existence of enormous solar farms: This represents that commercial solar systems possess more volume than residential solar panels in Austin.
  3. Awareness of taking steps for a clean environment: People in this state are more concerned about the global climate emergency than any other state. That is the foremost reason why people are making a switch to solar power.

What are Some Financial Incentives to Reduce the Cost of Solar Panels in Texas?

The lone star state has the following incentives and rebates available to lower the initial installation cost of panels:

1. Local Rebates:

Texas provides rebates like property tax exemption and Net Metering. Some utility providers also provide rebates of approximately $500 to $5,625, depending on the size of the system.

2. Federal Rebates:

The 30% solar investment tax credit helps subsidize the initial investment cost of PV modules. Due to this, many homeowners in the United States are able to afford a solar system. The credit reduces to 26% in 2033 and 22% in 2034.

texas annual

In conclusion, the cost of going solar in Texas varies depending on various factors such as the type and the size of the solar system and installation costs. While the initial cost may seem steep, the long-term benefits of switching to solar energy make it a worthwhile investment for many households and businesses in Texas. With tax credits and incentives available to help offset the cost, it is becoming easier for more people to make the switch to a cleaner and more sustainable source of energy.

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