Solar resource
Your solar production in Austin
5.07 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
Austin Energy electricity rate
$0.135/kWh residential
- Utility
- Austin Energy
- Residential rate
- $0.135/kWh (blended)
Austin Energy offers a Value of Solar Tariff (VOST) for net metering customers at approximately $0.097/kWh for exported energy — higher than the statewide average buyback rate. The blended savings rate used here reflects avoided retail purchases.
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Incentives
Available solar incentives in Austin, 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 |
| Austin Energy Value of Solar Tariff (VOST) | Net Metering | ~$0.097/kWh for exported solar 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)
- $1,147
- Simple payback period
- 10.4 years
- 25-year net savings
- $16705
- 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 Austin
- Your panels capture sunlight Solar panels convert sunlight into DC electricity. Austin averages 5.07 peak sun hours per day — among the highest in the country — meaning your panels produce at or near their rated capacity for about 5 hours each day on average.
- 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 Austin Energy at $0.135/kWh. A 6 kW system produces about 8,500 kWh/year in Austin — enough to offset most of a typical home's usage.
- Excess power flows back to the grid When your panels produce more than your home uses — common on sunny afternoons — excess electricity flows to Austin Energy's grid. Under the Value of Solar Tariff (VOST), Austin Energy pays you approximately $0.097/kWh for this exported energy.
- 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 Austin Energy's rates rise (historically ~2.5%/year), your solar savings increase while your system cost stays fixed. Over 25 years, a 6 kW system in Austin nets roughly $16,700 after repaying the installation cost.
FAQ
Common solar savings questions for Austin, TX
How much can I save with solar panels in Austin, TX?
A 6 kW system — typical for an Austin home — produces about 8,500 kWh/year and saves approximately $1,147/year at Austin Energy's current rate of $0.135/kWh. After the 30% federal tax credit, the net system cost is around $11,970, with a payback period of about 10 years and 25-year net savings near $16,700.
What is Austin Energy's solar rate (VOST)?
Austin Energy offers a Value of Solar Tariff (VOST) instead of traditional net metering. Under VOST, excess energy you export to the grid is credited at approximately $0.097/kWh — determined annually by Austin Energy. This rate is typically higher than what other Texas utilities offer for exported solar.
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 Austin solar installation, this avoids $300–$500 per year in property taxes. Texas does not have a state income tax credit for solar.
How much does a solar system cost in Austin?
A 6 kW system in Austin 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.
How does the federal solar tax credit work?
The federal Investment Tax Credit (ITC) lets you deduct 30% of your total solar installation cost from your federal income taxes in the year the system is installed. It's a dollar-for-dollar reduction in taxes owed, not a refund — you need sufficient tax liability to use it. The 30% rate applies through 2032 under the Inflation Reduction Act.
How many solar panels do I need for my Austin home?
A typical Austin home using 1,000–1,200 kWh/month needs a 6–8 kW system (roughly 16–22 standard panels at 370–400 W each). Use the calculator above to enter your monthly bill and get a system size estimate tailored to your usage.
Sources
Data sources and freshness
- https://pvwatts.nrel.gov/
- https://openei.org/apps/USURDB/
- https://austinenergy.com/ae/about/regulatory/tariffs/electric-service-tariffs
- 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/
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 2026-04-12.