Is Solar Still Worth It in 2026? Payback Math by State

The short answer

For many homeowners, yes, but it takes longer and it depends heavily on your state. Without the 30% federal credit that expired on December 31, 2025, payback now ranges from roughly 5 to 12 years in high-rate states with good export credits to 15 years or more in low-rate states, depending on whose model you use.

Two big analyses frame the national picture. EnergySage estimated that losing the credit makes the average payback about 43% longer, around four years (EnergySage). Wood Mackenzie, quoted by EnergySage, expected the average to move from about seven to about nine years (EnergySage).

The honest version: there is no single payback number. Two reputable sources can give very different answers for the same state, because they assume different system prices, rates and export rules. The table below shows both so you can see the range, then the rest of this guide shows how to calculate your own.

Solar payback by state in 2026 (without the federal credit)

The table compares two published estimates for the same states. Both assume no federal credit. Neither is a prediction for your house.

State	EnergySage estimate (years)	Tesla 2026 estimate (years)
Hawaii	not listed	5.0
Illinois	5.8	not listed
California	7.3	10.9
Massachusetts	7.8	8.9
New Jersey	8.8	8.0
New York	11.6	7.0
Maryland	11.5	9.7
Texas	8.9	14.6
Florida	15.5	11.8
Arizona	15.7	12.7
Colorado	16.1	11.0
Washington	20.2	14.4

Sources: EnergySage payback by state, without the ITC and Tesla solar payback guide, dated March 2, 2026.

How to read it

The pattern is consistent. States with expensive electricity and decent export credits (California, Massachusetts, New Jersey, Illinois, Hawaii) pay back fastest. States with cheaper power or weaker export rules take longer.
The gaps between sources are real. Texas is 8.9 years in one estimate and 14.6 in the other. New York is 11.6 versus 7.0. Methods differ: EnergySage does not state its system size or rate assumptions in the article, while Tesla says it assumes the system covers 100% of your usage, models state net metering rules, and builds in 0.5% yearly panel degradation and 3% yearly electricity price growth.
Both are averages for a state. Your utility, roof and usage can move the result by years. Tesla also sells solar, so treat its figures as one estimate, not a neutral benchmark.

Use the table to see whether your state is in the fast, middle or slow group, then run your own numbers with the payback calculator.

What drives your payback

Payback is simple arithmetic:

Payback (years) = net system cost ÷ annual electricity savings

Four inputs move it, and the first two matter most.

Your electricity rate. Every kilowatt-hour your panels produce is worth what you would otherwise pay for it. A home paying about 30¢ per kWh saves almost twice as much from the same panels as a home paying 16¢. SolarReviews, citing U.S. Energy Information Administration data, lists average residential rates of about 30¢ in California, 31¢ in Massachusetts and 28¢ in New York, against about 16¢ in Texas, Florida and Arizona (SolarReviews).
How your utility pays for exported power. Full retail net metering credits the solar power you send back at the same rate you pay. Net billing or avoided-cost rates pay much less. California shows how big the effect is: Wood Mackenzie said its newer export rates made payback for residential systems almost triple, from about five or six years to 14 or 15 (LAist). That is why batteries are now attached to most new California systems.
Your system cost. See how much solar panels cost in 2026.
Incentives. State credits, rebates, utility programs and property tax exemptions lower the net cost. Property tax exemptions for solar exist in more than 35 states (Longren), which keeps the added home value from raising your tax bill.

A worked example (illustrative numbers, not a forecast)

Take an 8 kW system that costs $20,880 and produces about 11,000 kWh a year.

Scenario	Annual savings	Payback
16¢ per kWh, full credit for all power	11,000 × $0.16 = $1,760	$20,880 ÷ $1,760 ≈ 11.9 years
30¢ per kWh, full credit for all power	11,000 × $0.30 = $3,300	$20,880 ÷ $3,300 ≈ 6.3 years
30¢ per kWh, but half the power is exported at 8¢	5,500 × $0.30 + 5,500 × $0.08 = $2,090	$20,880 ÷ $2,090 ≈ 10.0 years

The third row is the lesson: the same system and the same 30¢ rate go from about six years to about ten once exports earn little. A $3,000 state incentive on the first row would cut the net cost to $17,880 and the payback to about 10.2 years.

To run your own case, use the payback calculator with your quote, your incentives and the savings you estimate from your electric bill.

Solar cost and payback calculator

Change the numbers to match your quote and your bill.

System size (kW) Price per watt ($/W, from your quote) State, local and utility incentives ($) Estimated yearly savings on your electric bill ($)

Cost before incentives–

Cost after incentives–

Estimated payback–

Estimate only. Your savings depend on your electricity rate, your usage and your utility’s rules for exported power. There is no federal tax credit for homeowner-owned systems installed in 2026.

State by state: what changes the answer

Rules change often. Treat each point as a starting place and confirm the current terms with your utility and state energy office.

California. High rates (about 30¢ per kWh) make solar attractive, but newer export rates pay far less than the old net metering. Batteries now matter: the national attachment rate for new residential solar is around 40%, and California is at about 94% (SolarReviews). The two estimates in the table are 7.3 and 10.9 years, so get a quote for solar plus storage and compare it with solar alone.

Massachusetts. Rates are among the highest in the country (about 31¢), which helps payback, but installed prices are high too. Tesla’s table lists a net system cost of $30,050 for Massachusetts, the highest of the states it shows, with a payback of 8.9 years. EnergySage’s figure is 7.8.

New York. The two estimates differ the most here, 11.6 versus 7.0 years. Industry guides single out New York as one of the strongest standalone states for incentives (SurgePV), so check the current state programs before using any average.

Texas. Rates are lower (about 16¢) and the grid does not offer traditional net metering. Retail electricity providers compete on solar buyback plans, and some pay full retail credit while others pay wholesale rates (Longren). The buyback plan you pick can swing your payback by several years. The estimates run from 8.9 to 14.6 years.

Florida. Florida has relatively low installed costs and straightforward net metering (Longren), but rates are around 16¢, which keeps payback in the 11.8 to 15.5 year range in the two estimates.

Arizona. Sunshine is excellent and rates are about 16¢, but net metering rules are evolving and now pay export rates closer to avoided cost (Payaca). Estimates are 12.7 to 15.7 years, and batteries can change the math if your utility has time-of-use rates.

If your state is not here, start with your utility’s export rules. They matter more than the sun.

Who should go solar in 2026, and who should wait

Solar is more likely to make sense if:

You pay a high electricity rate (roughly 25¢ per kWh or more).
Your utility credits exports at or near the retail rate, or you can pair panels with a battery to use your own power.
Your state or utility offers incentives, rebates or a property tax exemption.
You plan to stay in the home for at least the length of your estimated payback.
Your roof is in good condition, with little shade and a good direction.
You can pay in cash or finance on fair terms.

Pause and compare options if:

Your rate is low (around 16¢ or less) and exports earn little. Estimated paybacks of 15 years or more are hard to justify for most households.
You may move within a few years, unless your state’s home-value data supports the investment.
Your roof needs replacing soon.
Your savings estimate depends on a rate increase you are only hoping for.
You are being pushed to sign the same day or to finance at a high rate.

Three ways to change the math

A lease or power purchase agreement (PPA). The installer claims a business federal credit that homeowners can no longer claim, and some pass part of that on as lower payments (Solar.com). You skip the upfront cost but you do not own the system, and the contract terms matter. Read lease vs buy in 2026 before signing.
A battery. In states with low export rates, storing your own power can matter more than selling it. It also adds cost, so compare solar alone with solar plus storage.
A smaller system. Sizing to your daytime use instead of 100% of your annual use can improve payback when exports are poorly paid.

Whatever you choose, get at least three quotes and ask for cash and loan prices in writing.

Frequently asked questions

Is solar still worth it without the federal tax credit? Often yes in states with high electricity rates and fair export credits, where published estimates run from about 5 to 12 years. In low-rate states with weak export credits, estimates can reach 15 years or more. Your own bill and your utility’s rules decide it.

How long does it take for solar panels to pay for themselves in 2026? Nationally, analysts point to roughly seven to nine years on average after the credit ended, but individual states range widely. See the table above and run your own numbers.

Which states have the fastest solar payback? In the two estimates we used, Hawaii, Illinois, California, Massachusetts and New Jersey are among the fastest. The ranking changes between sources, so treat it as a rough guide.

Do solar panels last long enough to pay back? Most systems are built to last 25 years or more, and Tesla’s model assumes about 0.5% output loss a year. A payback of ten years leaves many years of savings afterward, as long as you stay in the home and the system keeps working.

Should I get a battery with solar? It depends on how your utility pays for exports and whether it has time-of-use rates. Where exports earn little, a battery can help. Get quotes for both setups and compare.

Is leasing solar better now? It can be, because the installer keeps a federal credit and may lower your payments. You do not own the system and long contracts can complicate selling your home, so read the terms carefully.

Bottom line

Solar is no longer an automatic yes, and it is not dead. In high-rate states with good export credits, payback of roughly 5 to 12 years still makes sense for many owners. In low-rate states it is harder to justify. Use the table to see your state’s range, then calculate your own payback with your quote and your bill before you sign anything.

This article is for information only and is not tax, financial or installation advice. Payback depends on your usage, rate, utility rules, incentives and system price, and published estimates differ. Check your state, utility and installer for current terms. This site may earn a commission if you request quotes through links on this page.