Short answer, honest answer: maybe, depending on where you live, how you finance the system, and whether you value resilience and home value as well as pure dollars.
Based on recent what I’ve seen so far, the major story for 2026 is the federal tax policy changes that took effect late last year, and these updates significantly affect the tax calculations for many homeowners.
Below I walk you through the current incentives landscape, realistic cost ranges, simple payback examples you can copy for your own numbers, non financial benefits to weigh, and a practical checklist so you know whether to get quotes or wait.
In a Nutshell
- Solar economics changed in 2026: The 30 percent federal Residential Clean Energy Credit is no longer available for new installs, which lengthens payback for many homeowners compared to 2024 or 2025 systems.
- Costs are still reasonable, but incentives matter more than ever: Typical residential systems still run in the mid five figures, yet state rebates, utility programs, and strong net metering can significantly improve the math in certain areas.
- Your electricity rate largely determines payback: Homes in high rate states see faster returns because every kilowatt hour produced replaces expensive grid power.
- Solar is not just about savings: Resilience during outages, lower carbon emissions, and potential home value increases often tip the decision even when payback stretches beyond ten years.
- Local details decide whether solar is worth it for you: Roof condition, sun exposure, financing terms, and utility rules can turn solar into a smart move or a poor one, so quotes and local research are essential.
What changed in 2026 that matters most
A major federal tax credit for residential solar, called the Residential Clean Energy Credit, provided a 30 percent credit on qualified systems that were installed through December 31, 2025.
That credit is not available for systems placed in service after December 31, 2025, so installations completed in 2026 generally cannot claim it.
If you had a system installed in 2025 you may still carry forward unused credit amounts per IRS rules, but the broad 30 percent rebate ended for new 2026 systems.
This single change is the main reason homeowners should re-run the numbers for 2026 rather than relying on older payback calculations.
Typical costs you should expect in 2026
All in one place here are the real world price signals installers are quoting buyers in late 2025 into 2026. Typical installed residential system prices in the U.S. are roughly $2.50 to $3.50 per watt, depending on roof complexity, equipment choice and local market.
That means a 6 kilowatt system commonly quoted between about $15,000 and $21,000 before incentives. Industry marketplaces such as EnergySage and analysts track these averages and produce local price estimates you can use for a first pass.
A couple of other cost notes: In many markets battery storage is being bundled with solar more often. Storage prices have been falling, but adding a battery typically increases the upfront cost by several thousand dollars depending on capacity.
NREL and market trackers reported falling storage prices in recent years which helps the business case for backup, especially in outage prone areas.
How much electricity will a system produce and what is that worth
A quick rule of thumb is 1 kilowatt of solar produces roughly 1,000 to 1,500 kilowatt hours per year in many U.S. locations, with sunnier states on the higher end.
Multiply that by your local retail electricity rate to estimate annual savings. In 2026 the U.S. average residential electricity price sits near 18 cents per kilowatt hour, with large state by state variation. If you pay well above the national average your local payback improves markedly.
Example, copy this math for your zip code
• System size, 6 kW, production estimate, 1,200 kWh per kW per year -> annual production = 7,200 kWh.
• If your utility charges $0.18 per kWh, annual value of generation = 7,200 × $0.18 = $1,296.
That $1,296 is the gross annual offset of grid purchases before counting changes such as time of use rates, net metering rules, or system degradation over time.
Payback examples, with and without the federal credit
Below are two simple scenarios you can adapt. Use your system quotes, your actual kWh usage, and your real electricity rate to get precise results.
Scenario A, installed in 2025 and eligible for the 30 percent Residential Clean Energy Credit
• Installed price, $18,000 (6 kW at $3/watt)
• Federal credit, 30 percent of $18,000 = $5,400
• Net cost after credit = $12,600
• Annual value of generation = $1,296 (from example above)
• Simple payback = $12,600 ÷ $1,296 ≈ 9.7 years.
With generous local incentives, or high local retail rates, payback can be shorter. EnergySage and other marketplaces show typical 8 to 12 year paybacks in many parts of the country when the federal credit applies.
Scenario B, installed in 2026 with no federal credit (base case)
• Installed price, $18,000
• Federal credit = $0 for new 2026 installs (unless new law or carryforward rules apply)
• Net cost = $18,000
• Annual generation value = $1,296
• Simple payback = $18,000 ÷ $1,296 ≈ 13.9 years.
Bottom line, the absence of the 30 percent federal credit in 2026 stretches payback timelines by several years for many homeowners, which changes the calculus if you were relying on a 7 to 10 year breakeven.
Caveat on payback math: These simple payback numbers omit financing costs, any state or utility rebates, performance degradation, potential increases in retail electricity prices, and the fact that solar can increase your property value.
Use these as baseline scenarios and then add local incentives from DSIRE for more accuracy.
Incentives, net metering and local wrinkles
Even though the federal credit is expired for new installs, many states and utilities still offer rebates, performance payments, or strong net metering that materially improve the economics.
DSIRE is the best place to check current state, local and utility incentives and rules for interconnection and net metering.
Some utilities are also modifying net metering and adding fixed grid charges for solar customers, so be sure you understand how exported electricity is credited on your bill. These local policy details can tilt the decision either way.
Financing options and how they change the decision
You can pay cash, take a solar loan, or consider a lease or power purchase agreement. Cash gives the best long term returns, because you capture all bill savings and any property value bump.
Loans can make sense if they are low interest and short enough to keep the payback attractive. Leases or PPA deals still reduce near term bills but complicate resale and typically produce less lifetime value to the homeowner.
If you plan to sell within a few years consider that an owned system usually adds more value at resale than a leased system, but confirm how buyers and mortgage underwriters in your area treat solar.
Recent studies show solar can increase home sale price, but the effect varies by state and system ownership.
Non financial reasons to go solar
If you live in an area with frequent outages, pairing solar with battery storage can provide critical backup power, which many homeowners value beyond calculations.
Solar also reduces your household wastes, emissions and, in many markets, increases home marketability. If resilience and climate impact matter to you, those benefits count and can make a longer payback acceptable.
Storage costs have been falling, improving the case for backup when you need it. If you only care about pure dollars the numbers are the bottom line, but many homeowners include comfort and resilience in their personal ROI.
Practical checklist: should you get quotes now or wait
- Check whether your system would have been eligible for the 30 percent federal credit (installed in 2025). If yes, you may still benefit from carryforward rules when filing taxes. Check Form 5695 guidance on the IRS site or ask your tax advisor.
- Use DSIRE to identify state or utility rebates that apply in your area.
- Get three local, written quotes that normalize equipment specs, estimated annual production, warranties and interconnection costs. Compare per watt price, but make sure the assumed production numbers match your site.
- Run a simple payback with your actual electricity rate, or use EnergySage and other marketplaces to get ZIP code specific estimates.
- Ask installers about net metering, any fixed solar fees, and battery options if resilience is important. Document expected annual production and degradation assumptions for the contract.
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How I use it: I check daily generation and monthly trends, and set alerts for sudden drops which often indicate a fault or shading issue. That small habit can save weeks of lost generation without you noticing.
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Final thoughts
Is solar worth it in 2026? It depends. If you already installed in 2025 and captured the 30 percent federal credit your payback math will often look solid.
If you are planning a new 2026 install, run careful local math: factor in the absence of the federal credit, local net metering rules, any state or utility rebates, and your retail electricity rate.
Add non financial benefits like resilience and home value to your decision. In my view homeowners in high rate states or with frequent outages still often find solar compelling, while those in low rate states may want to delay until incentives or equipment prices shift to improve payback.
Frequently Asked Questions
Yes, for some homeowners. In areas with high electricity prices, strong net metering, or state level incentives, solar can still deliver acceptable payback. In lower cost electricity markets, the financial case may be weaker unless you value backup power or environmental impact.
Solar prices have declined over time, but policy changes and utility rules can move faster than hardware costs. If your electricity rates are high or outages are common, waiting may cost more in missed savings than you gain from slightly cheaper panels later.
Owned solar systems often add value to a home, particularly in states with high electricity costs. Leased systems are more complicated and can sometimes slow resale, so ownership structure matters.
A battery rarely shortens payback purely on dollars. Its value comes from backup power during outages, energy independence, and better use of your own solar generation, especially where net metering credits are limited.
Without the federal credit, many homeowners see simple payback periods between 12 and 16 years, depending on system cost and local utility rates. With generous state or utility incentives, payback can still fall under 10 years.
