Texas solar customers often wonder, “Are solar panels worth it in Texas?”
Given how electric rates consistently rise across North Texas and ongoing issues with the reliability of the ERCOT grid (grid outage Texas), Dallas-Fort Worth area homeowners are looking for ways to find some consistency. Recently, we’ve noticed a trend of utility bill increases across our local service area due to shifting energy policy, grid maintenance fees, and confusing utility plans. Having reliable energy shouldn’t be a puzzle.
If you’ve been following national media around energy topics, you may be left with more questions about how solar works specifically for Texas homeowners. Regional policy differences like net metering have a huge impact on understanding how much value you can actually derive from your home solar array. Here in Texas, we’re known for having one of the most competitive energy markets in the country. But what does that mean for families looking to go solar?
Do Solar Panels Pay For Themselves in Texas?
Navigating your way through the local solar market can be tricky. To avoid the pitfalls of misunderstanding how solar really works, it pays to start with a local perspective.
The short answer: Absolutely.
Let’s break down how reliable energy generation works for your specific home.
How Does Net Metering Work in Texas?
When looking at solar ROI, it can be difficult to understand how much you truly earn for the excess power your system produces each month. Net metering is the billing process that allows solar customers to receive a dollar-for-dollar credit for the electricity they supply to the grid. In a utility solar buyback plan, if a homeowner exports one kilowatt-hour (kWh) during the middle of the day, their electric provider will deduct one kWh from their electric bill at night.
Texas has no statewide net metering policy. Each utility territory and competitive retail electric provider establishes its own customer compensation structure.
How 1:1 Buyback Plans Work (Best Case Scenario):
[ Daytime Generation ] → Excess Energy Exported → Earns Dollar-for-Dollar Credit
[ Nighttime Usage ] ← Energy Pull from Grid ← Reduced from Monthly Bill by Credits
Solar Buyback from Texas Electric Providers
Since there is not a statewide mandate for net metering in Texas, solar customers actually rely on competitive retail electric providers (REP) to secure the best solar buyback plans in deregulated markets such as the Dallas-Fort Worth Metroplex. Think of REP’s as private wholesale electricity buyers that resell energy directly to consumers.
Rather than offering straightforward net metering, many electric providers in Texas offer alternative solar buyback agreements that may not necessarily offer true one-to-one credit for your excess generation. Some plans may offer one- to-one credit for part of your energy generation, while others may give you billed-back energy at a greatly diminished wholesale value.
That’s why it’s so important to work with an experienced local solar installer that understands how your system design will perform against the realities of your local energy market. Residents who get electricity from a regulated utility company outside of the competitive ERCOT energy market (think cities like Georgetown with municipal utilities or Electric Cooperatives) have billing rules set by a local board of directors. But most Texans living in the DFW area can purchase any retail electricity plan they want on the open market.
Choosing Wrong Can Cost You Thousands On an Identical Solar System
Selecting the right electricity plan is just as important as the solar array itself. Unfortunately, some Dallas solar customers have selected the plan with the highest advertised export rate without considering other common fees.
- High Buyback $/kWh + Hidden Export Caps/Base Customer Fees = LESS Savings
- Average Buyback $/kWh + Low Base Fee + Unlimited Export Credits = MORE ROI
Here in Texas, we always recommend reviewing your retail electric rate (cost of electricity you pay to draw from the grid) against your REP’s wholesale rate of electricity (sometimes referred to as avoided cost or wholesale rate). If your REP charges 16 cents per kWh for power draw but only offers you a 5-cent buyback rate for exported energy, you could be leaving money on the table by oversizing your solar system.
Oversized solar arrays create unnecessary clutter on your roof and will consistently export low-value electricity back to your utility. By analyzing your historical energy usage, you can properly size a system to match your consumption profile and avoid overposting your solar array.
Solar Energy Benefits in Texas
Of course, we all install solar to save money on our monthly electric bills. But did you know that by installing solar, you’re also creating a useful hedge against unpredictable grid energy prices?
The ERCOT grid experiences wide swings in electricity prices throughout the year. Record-high demand during summer heat waves and winter storms can drive up wholesale energy prices by hundreds of percent. While these wholesale costs don’t always translate directly to retail customers, they eventually do lead to higher-priced energy plans and new grid maintenance fees for everyone.
Solar Panels + Battery Backup = Grid Resiliency
Home battery installations aren’t just for nighttime backup power! By installing a solar battery on your system, you can begin to shift your home’s energy consumption from the buy-back model and into a total self-consumption model.
Avoid the Buyback Model: Grid Policy Changes will still increase your costs.
- Old Way: Generate Solar Power → Sell it Back to the Grid for Cheap → Buy Higher Cost Power at Night
- New Way: Generate Solar Power → Store it in your Battery for Later → Use Your Own Power at Night
Why Solar Batteries Are a Game Changer in Texas
Thanks to recent policy shifts in utility buyback rates, we’ve seen an increased demand for solar batteries throughout Texas. Selling your power back to the grid should be a secondary form of savings. True solar ROI comes from consuming the energy you pay for.
If your solar system is sized appropriately for your home, you’ll never have to sell your power back to the grid again.
Solar Plus Storage Action Items
- Evaluate your monthly sunshine: Unless you track your electricity consumption closely, now is a great time to sit down and really understand your energy habits. Download past utility bills and make a note of your highest month of summer and winter consumption.
- Inspect your roof’s condition: From tree shading to actual roof health, make sure you know where your panels will actually be installed before pulling permits.
- Request quotes from local solar companies: Texas solar companies will be able to provide additional guidance on current solar buyback plans, retail plan fees, and monthly kWh export limits.
How to Size a Solar Battery for Your Texas Home
We recommend sitting down with your solar installer to determine what you’ll primarily be using your battery for. Off-grid solar batteries are large and expensive for a reason; they can power your entire home during a grid outage. Local solar professionals can assist you with designing a solar battery that fits your family’s needs.
- Daily battery cycling to reduce monthly costs
- 2 to 7-day emergency backup for grid outages
- Some mixture that’s specific to your business needs
Once you have a good grasp on your expected solar savings, give Texas Solar Professional a call. One of our experts can analyze your local utility data to recommend the right solar battery size for your home.
Solar for North Texas Weather
We love solar in Texas, but did you know that not all air conditioners are created equal? Standard cooling and heating equipment was designed decades ago, when efficient climate control technology was extremely limited.
Texas summers are brutal. But they’re also very humid. Indoor air quality isn’t just about how cool you feel — it’s also about how dry you can keep your home during peak summer months.
Single-Stage vs. Variable-Speed Air Conditioners
The problem with traditional air conditioners is how they operate. Older units are designed to run at 100% until they reach your thermostat temperature and suddenly shut off.
These amps of energy drawn when your AC first turns on is why many homeowners experience sudden battery drains when the power goes out. By installing a variable-speed AC system, you can dramatically reduce your total energy consumption and stay comfortable all season long.
Hybrid-Dual Fuel Heat Pump Solutions
If you’re attached to your gas furnace, a dual-fuel hybrid heat pump may be the perfect solution for your home. During mild winter months, your heating system will rely exclusively on efficient electric heat pump technology to keep you comfortable.
When the temperature drops, your heat pump automatically engages your gas furnace as a backup heating source.
Make It Worth It | Texas Solar Professionals
Is solar worth it in Texas? At the end of the day, solar energy is only as valuable as the system that produces it. Texas may not have statewide net metering, but we do offer one of the most competitive retail markets for solar energy in the United States. By carefully sizing your solar array and attaching a solar battery, savvy Texans can reliably lower their monthly expenses and protect their homes from unpredictable grid energy prices.
Texas Solar Professional specializes in end-to-end solar services for Texas homeowners. From energy audits to solar installations and battery storage, we built our company around 100% W-2 crews. Contact Texas Solar Professional today to learn more about going solar in Texas.
FAQ
Q: Are solar panels worth it in Texas if we don’t have net metering?
A: Texas may not have statewide net metering, but solar customers can obtain best-in-class solar buyback plans from competitive retail electricity providers. You can also avoid worrying about utility buyback policies by adding a solar battery to your system.
Q: What exactly is the difference between net metering and a solar buyback plan?
A: Net metering is when a state mandates electricity providers to credit solar energy at a retail dollar-for-dollar rate. Solar buyback plans in Texas are set by individual retail electricity providers and can vary by export rate, base fees, and monthly kWh export caps.
Q: How does adding a solar battery help me save more money?
A: Batteries help you shift your solar consumption model away from selling power back to the grid and into total solar self-consumption. You’ll use every last kWh you produce!
Q: How does an inverter-driven HVAC system benefit my solar-powered home?
A: By converting to a heating and cooling system that uses inverters, you can dramatically reduce your total energy consumption during the summer. Think of it as fully optimizing your solar array.