Texas power averages about 16.4 cents per kWh (EIA), and Houston’s grid is deregulated. CenterPoint Energy delivers your electricity, but you choose a separate retail provider for the supply. There is no statewide net metering, so your credit for solar you send back depends on your provider’s solar buyback plan. Verify a current buyback plan before you sign.
Houston is one of the more misunderstood solar markets in the country, and it comes down to how Texas sells electricity. In most of the state, including Houston, the grid is deregulated: one company delivers your power over the poles and wires, and a different company, the one you pick, sells you the energy. That split changes how rooftop solar pays you back, because Texas has no statewide net-metering rule. This page covers what solar really costs in Houston, who your utility actually is, how buyback replaces net metering, and the Gulf-coast install details, then you can check your address in about a minute.
Why Houston’s electric rates make solar worth a look
Solar pays in Houston because of the price of the power it replaces. Texas residential electricity averages about 16.4 cents per kWh (U.S. Energy Information Administration, data through May 2026). Houston sits inside a deregulated market, so the exact rate you pay is set by the retail plan you chose, and summer air-conditioning load on the Gulf coast pushes a lot of homes into high-usage tiers. Every kilowatt-hour your roof makes is one you do not buy back from your retail provider at that rate.
According to MySolarFY’s analysis of NREL PVWatts data (as of August 2026), a typical 6 kW rooftop system in Houston (ZIP 77002) produces roughly 8,479 kWh of electricity a year, about 16% capacity factor. Your own number depends on your roof’s pitch, shading, and orientation, so model your address before you size a system.
Production is what turns that rate into savings. Houston gets a strong solar resource for the Gulf coast, but output swings with your roof and with cloud cover off the bay, so estimate your specific roof with NREL’s free PVWatts calculator rather than a generic figure. Your production drives your bill offset and whatever your retail provider pays for exports.
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Who is your Houston electric utility, really
In Houston your “utility” is two companies, not one. CenterPoint Energy is the regulated transmission and distribution utility (TDU) for the Houston area. It owns the poles, wires, and meter, restores power after storms, and processes your solar interconnection, but it does not sell you energy (CenterPoint Energy, as of 2026). The energy itself comes from a Retail Electric Provider (REP) you choose on the deregulated market run through Power to Choose, the Public Utility Commission of Texas’ official shopping site (Public Utility Commission of Texas, as of 2026). Because CenterPoint is the wires company for the whole Houston region, its interconnection steps, fees, and timelines shape every rooftop install here; for that territory-wide detail, see our CenterPoint solar guide.
This is different from Austin and San Antonio. Austin Energy and CPS Energy are municipal utilities that sit outside deregulation and run their own solar programs, so their rules do not apply in Houston. For the statewide picture, see our Texas solar guide.
How solar buyback replaces net metering in deregulated Houston
Texas has no statewide net-metering mandate, so the one-for-one credit many states offer does not exist here by law. Instead, whether and how you get paid for the extra power your panels send to the grid depends entirely on your Retail Electric Provider’s solar buyback plan (Public Utility Commission of Texas, as of 2026). Several REPs sell buyback or solar-friendly plans, but the credit rate, the caps, and the plan terms vary by provider and change over time, so treat the buyback rate as something to verify on a current plan, not a fixed number.
| Piece of your Houston bill | Who handles it | What to verify |
|---|---|---|
| Delivery (poles, wires, meter, interconnection) | CenterPoint Energy (the TDU) | The interconnection application and any delivery charges |
| Energy supply | Your Retail Electric Provider (you choose) | Your per-kWh rate and contract term |
| Credit for exported solar | Your provider’s solar buyback plan | Whether a buyback plan exists, its credit rate, and any cap |
Because export credit is not guaranteed by law here, the smart move in Houston is to size a system close to your own daytime and battery use so most of your solar offsets power you would otherwise buy, rather than banking on a high buyback rate. For how one-for-one crediting works in states that do mandate it, see how net metering credits your solar exports, and for the money side, our Texas solar cost guide.
Houston permitting and the Gulf-coast details that are local
Houston’s own rules and its weather are what make a local install different. A rooftop system inside the city needs a City of Houston electrical and building permit, filed through the Houston Permitting Center, and CenterPoint has to approve the interconnection before the system can turn on (City of Houston Permitting, as of 2026). Outside the city limits you may deal with Harris County instead, so confirm which jurisdiction covers your address.
Gulf-coast note: Houston is in a high-wind hurricane zone, so your racking and attachment have to meet the local wind-load requirements in the adopted building code. A qualified installer will engineer the mounts for coastal wind speeds and flash every roof penetration against wind-driven rain. This is normal here, but it is a real reason to use an installer who pulls Houston permits regularly rather than the cheapest bid.
What the federal tax-credit change means for Houston
The 30% federal homeowner credit is gone. The federal Residential Clean Energy Credit (Section 25D) ended for systems placed in service after December 31, 2025, under the One Big Beautiful Bill Act, so a Houston homeowner who buys solar with cash or a loan in 2026 cannot claim it (IRS Residential Clean Energy Credit, as of 2026). You will still see installer ads asking whether the credit is going away; the accurate answer for 2026 is that the homeowner version already ended. For the full timeline, see what the federal solar tax credit change means in 2026.
One federal exception exists, and it is not yours to claim. A separate commercial credit, Section 48E, is claimed by the business that owns a leased or PPA system, not by the homeowner (IRS Clean Electricity Investment Credit, as of 2026). On a leased system the company that owns the panels files for that credit, not you. The 25D homeowner credit, by contrast, ended after December 31, 2025.
Paying for solar in Houston: cash, loan, lease, or PPA
There is no single right way to pay for solar. The best fit depends on whether you want to own the system, or avoid an up-front cost. A lease or PPA can mean no up-front cost for eligible homeowners, but it is a long-term agreement with monthly payments, not free solar, and the company that owns the system, not you, collects any tax benefit. To weigh the long-run numbers, see whether solar panels are worth it.
| Path | Up-front cost | Who owns the system | Best when |
|---|---|---|---|
| Cash purchase | Full system cost | You | You want the fastest payback and the most lifetime savings |
| Solar loan | Little to none, financed | You | You want ownership without paying cash up front |
| Lease or PPA | $0-up-front where eligible | The third-party owner | You prefer no up-front cost and a simpler, fixed monthly bill |
How to choose a solar installer in Houston
Houston has an active market of licensed installers, which is good for you because it means real competition on price and service. Rather than chasing a “best installer” list, screen any company against objective criteria:
- NABCEP certification, the industry’s professional standard for PV installers.
- A valid Texas electrical contractor license and proper City of Houston or Harris County permitting.
- Real experience with CenterPoint interconnection and Houston wind-load engineering, so the paperwork and the coastal build both go smoothly.
- A clear workmanship and equipment warranty in writing.
- A written production estimate and a transparent quote. For a checklist, see the right questions to ask a solar installer.
MySolarFY matches you with licensed installers that serve your area so you can compare real local quotes side by side, with no obligation.
Check which solar programs are available at your Houston address →
Frequently asked questions
Is solar worth it in Houston in 2026?
For many owner-occupied Houston homes with decent sun and high summer bills, yes, but the math is different from a net-metering state. Texas residential power averages about 16.4 cents per kWh (EIA, data through May 2026), and a typical 6 kW roof here produces roughly 8,479 kWh a year by NREL PVWatts. Because there is no statewide net metering, your best savings come from offsetting the power you use directly, plus whatever your retail provider’s buyback plan pays. Savings depend on your roof, usage, plan, and how you pay.
Who is my electric utility for solar in Houston?
Two companies. CenterPoint Energy is the regulated transmission and distribution utility that owns the wires and processes your solar interconnection, but it does not sell you energy (CenterPoint Energy, as of 2026). Your energy comes from a Retail Electric Provider you choose on the deregulated market through the state’s Power to Choose site. Both appear on your bill, and both matter for solar: CenterPoint for interconnection, your provider for the rate and the buyback plan.
Does Houston have net metering?
No, not as a statewide rule. Texas does not mandate net metering, so there is no legal one-for-one credit for the solar power you export in Houston (Public Utility Commission of Texas, as of 2026). Instead, some Retail Electric Providers offer solar buyback plans that credit your exports, but the rate and terms vary by provider and change over time. Verify that a current buyback plan is available, and at what rate, before you choose a provider or size your system.
What happened to the federal solar tax credit?
The 30% federal Residential Clean Energy Credit (Section 25D) ended for systems placed in service after December 31, 2025, under the One Big Beautiful Bill Act, so a Houston homeowner who buys solar in 2026 with cash or a loan cannot claim it (IRS, as of 2026). A separate commercial credit, Section 48E, can apply to leased and PPA systems, but the business that owns the system claims it, not the homeowner.
Do I need a permit for solar in Houston?
Yes. A rooftop solar system inside the city needs a City of Houston electrical and building permit through the Houston Permitting Center, and CenterPoint must approve the interconnection before the system energizes (as of 2026). Outside the city limits, Harris County may handle the permit instead. Because Houston is a high-wind coastal area, your racking must meet the local wind-load code, so use an installer who pulls Houston permits regularly.
Reviewed by the MySolarFY team. Figures were verified against the linked EIA, NREL PVWatts, Public Utility Commission of Texas, CenterPoint Energy, City of Houston, and IRS sources as of August 2026. Texas is a deregulated market, so retail rates and solar buyback plans vary by provider and change over time; confirm current plan terms with a Retail Electric Provider and CenterPoint before you decide. MySolarFY does not provide tax or financial advice; consult a licensed professional about your own situation. Learn more about the MySolarFY team and how we work.
MySolarFY is a free service that matches homeowners with licensed solar installers. We are not an installer, financing company, or government program. “No up-front cost” refers to qualifying lease or PPA financing, where eligible homeowners may have no out-of-pocket cost at installation. Lease and PPA terms typically run 20 to 25 years, may include an annual price escalator, and total payments may exceed the cost of a cash purchase; on a lease or PPA any tax benefit goes to the company that owns the system, not the homeowner. Homeowners do not get the federal residential credit that ended after December 31, 2025. Solar panels are not free and monthly payments apply. Solar buyback credit is not guaranteed and varies by provider. Eligibility, savings, incentives, and rates vary and are not guaranteed. See our full disclaimer.
