Is solar worth it in 2026?

What changed, in one paragraph

The Residential Clean Energy Credit (Section 25D), the 30% you could claim on a system you bought, expired on December 31, 2025. If you buy a system in 2026, there is no federal income-tax credit. Everything else about solar is unchanged: panels still cost roughly the same, still last 25+ years, and still cut your bill. What's gone is a chunk of the upfront discount, which pushes payback out by a few years.

The four things that decide it

Whether solar is worth it for your home comes down to four numbers, roughly in order of impact:

1. Your electricity rate

This is the single biggest lever. Every kWh your panels produce is a kWh you don't buy, so the more you pay per kWh, the faster solar pays back. At 30¢+/kWh (California, Massachusetts, Connecticut, Hawaii, Rhode Island) the case is strong. At 12-14¢/kWh (Washington, Louisiana, North Dakota, Idaho) it's much more marginal, and you should run the numbers carefully.

2. Your net-metering policy

How your utility credits the power you export decides how much of your generation actually turns into savings. Full 1:1 net metering (still the rule in most states) means a right-sized system can nearly zero out your bill. Net billing, California's NEM 3.0, plus Arizona, Nevada, and a growing list, pays far less for exports, which rewards using your own power and often makes a battery worth considering. We explain the difference here.

3. Your sun

A kW of panels in Arizona produces roughly 50% more per year than the same kW in Seattle. It matters, but less than people assume, high electricity rates in cloudy states (the Northeast) frequently beat cheap power in sunny ones. Sun is a multiplier on the first two factors, not a substitute for them.

4. How you pay

Cash purchase delivers the best lifetime return but the slowest break-even. A loan spreads the cost but adds interest. A lease or PPA gets you a lower bill with no upfront outlay, and, because the installer can still claim the commercial tax credit, can price in a discount you can no longer get by buying.Here's how the three routes compare.

So, worth it, or not?

In 2026, a reasonable rule of thumb:

• Likely worth it: you pay 20¢+/kWh, have full net metering or good self-consumption, a sound south/west-facing roof, and plan to stay 7+ years.
• Run the numbers carefully: rates of 14-20¢/kWh, or a net-billing state where you'd need a battery to capture the value.
• Probably not (yet): sub-14¢/kWh power, heavy shading, or a roof due for replacement within a few years.

None of this needs guesswork. Our calculator uses your state's real rate, sun, and export policy, and never assumes a federal credit that no longer exists, so the payback you see is the payback you'd actually get.