Comprehensive FAQ on Solar Panel Installation in Austin: All You Should Know

Austin USA

With an impressive solar capacity of 20,028 MW, Texas proudly holds the 2nd national ranking. This substantial solar infrastructure has the power to energize 2,329,037 homes, contributing significantly to the state’s electricity grid, with solar accounting for 5.51% of the total electricity generated.

This comprehensive FAQ guide will delve into the various aspects of solar panel installation in Austin, Texas, providing you with valuable information to make informed decisions.

Popularity of solar panel installation in Austin

Austin has solidified its position as a focal point for renewable energy enthusiasts, witnessing a surge in the popularity of solar panel installations.

A recent study by Environment Texas revealed Austin’s prominence in solar power, showcasing an impressive 90-plus watts of installed solar capacity per person.

Adding to Austin’s solar prowess, Tesla is constructing its largest rooftop solar installation at the East Austin, Texas, factory. This groundbreaking project is set to generate an astonishing 30 megawatts of power upon completion, making it the largest of its kind globally, as confirmed by company officials.

popularity of solar installation
Photo by Kindel Media

How can you pay for solar panels in Austin?

In Texas, various financing options are available. The popular option would be the Power Purchase Agreements (PPAs), which offer a predetermined electricity rate without system ownership; however, it excludes federal tax credits.

Leases are where customers pay a fixed monthly fee for rented systems unaffected by electricity production.

Loans enable system ownership with access to federal tax credits but involve interest costs; and finally, one can opt for full upfront purchases, providing long-term benefits without interest.

The special options for residence and business owners in Austin, Texas, would be the Home Equity Lines of Credit (HELOCs) and Cash-Out Refinance options, which offer alternative, potentially more affordable financing solutions with lower interest rates.

Solar lease vs. solar purchase options in Austin

Solar leasing in Austin enables customers to rent a solar panel system with a fixed monthly fee, providing a low-commitment option for accessing solar energy.

On the other hand, an upfront purchase entails a substantial initial investment but ensures long-term returns, ownership benefits, tax credits, and increased property value.

Austin Energy solar buyback

A common query might be, “Can you sell electricity back to the grid in Texas?”

Each credit holds a value of 9.91 cents per kilowatt-hour (kWh), and Austin Energy purchases all the generated solar power.

Austin Energy also encourages solar panel installation in Austin, TX, through its Solar Photovoltaic (PV) Rebate & Incentives program.

Austin Energy offers a one-time solar buyback incentive of up to $2,500 per solar PV system for home installations with a minimum installed capacity of 3 kW, provided applicants undergo a solar course.

Are there solar panel installation companies in Austin?

One might inquire,” How many solar companies operate in Texas?”

Regarding solar companies in Texas, according to SEIA, there are 647, including 105 manufacturers, 254 installers/developers, and 288 others.

Some of Austin’s best solar panel installation companies include Blue Raven Solar, known for its industry-leading in-house financing and competitive pricing; Momentum Solar, offering excellent warranty coverage and regional expertise; and ADT Solar, distinguished by industry-leading warranty coverage and a broad service area.

Researching and selecting a solar panel installation company with a proven track record is essential to ensure a smooth and efficient installation process.

Frequently Asked Questions (FAQs)

How much can solar panels save in Austin?

In Austin, where energy costs are tiered, the greater your consumption, the higher your electricity expenses—making solar panels a powerful saver. The actual expense of your system hinges on factors like panel brand and installer choice. Despite upfront costs, many Austin homeowners find it worthwhile, realizing an average savings of $18,000 on electricity bills over 20 years.

How much does it cost on average to install solar panels on a home in Austin?

Providing an exact answer to this question proves challenging due to varying factors influencing the cost.

For residential solar panel installation in Austin, generally, a 5-kW system costs approximately $16,650, while a 10-kW system solar panel installation in Austin costs around $33,300 after applying the Investment Tax Credit (ITC).

Additional expenses may arise for extrasolar equipment, high-efficiency panels, or above-average energy usage, while opting for a smaller system or more affordable panels can result in lower costs.

Are there free solar panels in Austin, Texas?

While free solar panels may sound appealing, it’s essential to understand that this is usually a marketing strategy to enter into a Power Purchase Agreement (PPA) directly with a state-licensed solar energy company. Here, the company could cover the entire expense of solar panel equipment and installation on your behalf. On average, solar panels in Austin cost $3 per watt.

Is solar installation free in Austin, Texas?

While free solar panel installation in Austin is not available, Austin Energy provides the following:

  • Various incentives and rebates.
  • They are making solar installation more affordable for residents, such as incentives to ease the upfront cost of solar PV system installation.
  • Offering a $2,500 rebate for completing a solar education course.

Additionally, homeowners with solar systems qualify for federal tax credits and property tax exemptions while receiving monthly bill credits based on the solar system’s electricity generation.

However, if you choose to lease or enter a Power Purchase Agreement (PPA), you won’t be eligible for the upfront rebate. Note that PPAs are not allowed in the Austin Energy Service Area.

Is there a tax credit for buying solar panels in Austin?

While Texas lacks a statewide solar tax credit or rebate, local governments, and utility companies, including Austin Energy, incentivize residents to adopt solar. In Austin, homeowners can benefit from a $2,500 rebate and Austin Energy’s Value of Solar Tariff, compensating $0.097 for each kilowatt-hour their solar panels generate.

Do I need a solar battery in Austin?

While not mandatory, a solar battery can enhance the reliability of a solar panel system. It allows owners to store excess energy generated during the day during low sunlight or power outages.

Are solar panels covered by homeowners insurance in Austin, Texas?

Your homeowner’s insurance typically includes coverage for your solar panels, granted they are attached to your home.

Coverage falls under the dwelling portion of your policy, with protection against covered perils such as hail or fire damage. In most cases of wear and tear, flooding and earthquakes may not be covered, requiring a separate policy for protection.

It’s crucial to review your policy and consult with your insurer to confirm adequate coverage for your panels in case of an incident.

Do solar panels increase home value in Austin, Texas?

Most real estate research has shown that solar panel installations can increase home value. A solar-equipped home is attractive to eco-conscious buyers and signals energy efficiency, contributing to a higher resale value.

According to NREL, each dollar saved on your electricity bill through solar panels translates to a $20 increase in your home’s value, emphasizing the logical and valuable nature of this investment for homeowners.

However, it is crucial to note that opting to lease solar panels means you won’t own the system, missing out on incentives and failing to boost your home value.

Do solar panels increase property taxes in Austin, Texas?

In Austin, solar panel installations do not increase property taxes. In fact, according to Texas Tax Code Incentives for Renewable Energy, the state provides a complete 100% property tax exemption on the assessed value of on-site solar, wind, or biomass power generation equipment.

The city supports renewable energy initiatives and encourages residents to embrace solar power without imposing additional tax burdens.

solar installation in Austin
Photo by Jeswin Thomas


The significant expansion of solar capacity, coupled with the generous incentives from Austin Energy, establishes solar power as an economically sound choice for residents and business owners.

The impressive contributions of leading solar companies and the city’s commitment to sustainability create a promising landscape for those seeking long-term cost savings. As the solar industry in Austin continues to thrive, it addresses the city’s current energy needs and sets a precedent for a greener and more sustainable future.

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