Solar Incentives 2026: Every State, Local, and Utility Program That Still Saves You Money

Here's the headline: the 30% federal solar tax credit is gone.

If you've been following solar news, you know this. The Section 25D Residential Clean Energy Credit — the program that gave homeowners a dollar-for-dollar tax reduction equal to 30% of their solar installation cost — expired on December 31, 2025.^[1]

A $30,000 system that used to come with a $9,000 tax rebate now costs the full $30,000. That's a real difference. No sugarcoating it.

But here's what most headlines don't tell you: the incentives didn't disappear. They shifted. State programs, utility rebates, property tax exemptions, and local grant programs now account for a significant portion of solar savings — and in some states, they still add up to more than $5,000 in total incentives.

Plus, some federal programs didn't expire. The commercial solar credit (Section 48E) is still very much alive — which is why some third-party ownership models (PPAs, leases) remain competitive.

Let's go through everything that's still available in 2026, organized by type and state.

Quick pick: what incentives are available to you?

Here's the full breakdown.

What's still available at the federal level

The landscape at the federal level has changed dramatically. Let's clarify what's gone and what remains.

Gone: Section 25D — Residential Clean Energy Credit

This was the program that gave you 30% of your solar installation cost as a tax credit. It expired December 31, 2025, for systems installed after that date.^[2]

Important: If you had a written contract before January 1, 2026, and your system was installed by the deadline specified in that contract, you may still qualify for the 30% credit on your 2025 taxes. Consult your tax advisor if this applies to you.

No longer available for 2026 installs: DAC-SASH (direct pay for lower-income households)

The Inflation Reduction Act also created the Distributed Energy Resources and Climate Savings for All Households (DAC-SASH) program (Section 13506). It paid the value of the residential solar and battery credits directly — as a payment, not a tax deduction — so households without enough tax liability still got the money.^[3]

How it worked: households with income at or below 150% of the area median income qualified. Households at or below 80% of the median received 100% of the applicable credit; households between 80% and 150% received 50%. Since the residential solar credit was 30% of cost, a $30,000 system in a qualifying household below 80% of the median would have received about $9,000 — a direct payment of the credit, not full cost coverage.

Why it's gone for new 2026 installations: DAC-SASH was an extension of the 25D/25C credits, not a standalone program. When those credits expired on December 31, 2025, the DAC-SASH direct pay for new residential solar ended with them. If a solar installer or marketer in 2026 is pitching you a "federal $40,000 grant," that is not a real program.

If you're a low- or moderate-income homeowner in 2026: your realistic options are state and utility low-income programs — California's SGIP "Residential Solar and Storage Equity" (AB 209) budget, New York's NY-Sun NY Gain, and various utility assistance programs — plus the standard incentives in this guide. These can sometimes be stacked, and your installer should be able to identify what applies to your address.

Still here: Section 48E — Commercial Clean Energy Credit

This credit remains available for commercial installations and for certain residential projects that meet specific criteria. It provides a credit of 30% of the investment for qualified clean energy property.^[4]

Why this matters for homeowners: third-party ownership models (PPAs and leases) fall under Section 48E, not Section 25D. The company that owns your panels claims the credit, which is why PPA rates can remain competitive even without the residential credit. This also means homeowners with sufficient tax liability can sometimes structure their installation as a "tax equity" deal to benefit from the commercial credit.

Still here: EV Charger Credit (Section 30D)

If you're installing an electric vehicle charger alongside solar panels, the EV charger tax credit is still available: 30% of the cost, up to $1,000.^[5]

State tax credits and rebates — the big players

With the federal credit gone, state programs matter more than ever. Here's where the money is:

California 🌴

California is the most generous state for solar incentives — but the big battery rebate has run dry.

• Self-Generation Incentive Program (SGIP): effectively unavailable for new 2026 applications. Standard budget funding is exhausted; as of January 1, 2026, new applications can only go to the low-income "Residential Solar and Storage Equity" (AB 209) budget, and that funding is currently fully reserved with new applicants placed on a waitlist. (For reference, historical SGIP rates: small residential storage $0.50→$0.15/Wh in declining steps.)^[6]
• Property tax exclusion: Solar installations are 100% exempt from property tax assessment increases.^[7]
• Net Billing Tariff (NBT): While export credits under NBT are modest compared to old NEM 2.0, the value of avoiding high retail rates (some of the highest in the nation) is what makes California solar pay back fast.

Total potential savings in California: ~$1,000–$4,000 (mainly the property tax exclusion over time plus strong avoided-cost savings from high retail rates; SGIP is no longer available for standard households).

New York 🗽

• NY-Sun Megawatt Block Incentive: $0.20–$0.30 per watt for residential solar (typically $3,000–$6,000 for a typical system).^[8] Note: funding is allocated in limited blocks, so availability varies by year and utility territory.
• NY-Sun NY Gain: Additional incentives for low-to-moderate income households.
• Property tax exemption: 10-year property tax exemption for the value added by solar (RPTL §487 "Value Increase Exemption").^[9]
• Sales tax exemption: Solar equipment is exempt from NY state sales tax (6.875%).

Total potential savings in New York: $3,000–$8,000+

Massachusetts 🏛️

• Mass Solar Loan Program: Low-interest loans (0–4%) for solar installations through Mass Solar Loan.^[10]
• Solar Renewable Energy Certificates (SRECs): Massachusetts doesn't have an active SREC market for residential solar, but the state's Clean Energy Standard provides long-term value through grid credits.
• Property tax exemption: 100% property tax exemption for solar installations (99-C Phase 2).^[11]
• Sales tax exemption: 6.25% sales tax exemption for solar equipment.

Total potential savings in Massachusetts: $2,500–$6,000+

Connecticut 🌉

• Green Bank Solar Loan: 0% interest loans for solar installations up to $25,000.^[12]
• SRECs: Connecticut's SREC market is active, but prices fluctuate with the market and have declined from earlier program years. Also, the SREC 2.0 program sunsets at the end of 2026. Treat SREC income as a possible bonus, not a core assumption in your ROI math.
• Property tax exemption: 100% property tax exemption for solar installations.

Total potential savings in Connecticut: $1,500–$4,000 (loan program + property tax exemption; SREC income is a variable bonus, not a certainty).

Texas 🤠

• Property tax exemption: 100% exemption for solar equipment added to property value (Senate Bill 1406).^[13]
• Sales tax exemption: Solar equipment is exempt from state sales tax.
• Utility programs: Varies by utility, and many past residential solar rebates have ended or been capped — verify current programs with your specific utility before budgeting on them. Net metering terms also vary by utility, which matters more long-term than any one-time rebate.

Total potential savings in Texas: $1,500–$5,000+ (heavily utility-dependent)

Arizona 🌵

• State income tax credit: Up to $1,000 (single) or $2,000 (joint) for solar installations.^[14]
• Property tax exemption: 100% property tax exemption for solar equipment.
• Sales tax exemption: Solar equipment exempt from state and local sales tax (Arizona Solar Hardware Exemption).
• Utility rebates: APS offers time-of-use rates that favor solar. SRP does not offer a direct rebate but has favorable net metering.

Total potential savings in Arizona: $2,000–$4,000+

Florida 🏖️

• Property tax exemption: 100% property tax exemption for solar equipment (Florida Statute 196.198).^[15]
• Sales tax exemption: Solar equipment exempt from state sales tax ("Bright from the Sun" exemption).
• Net metering: FPL credits exported energy at the full retail rate, which is the main ongoing value of solar in Florida. FPL's early-adopter solar rebate has ended; its Power Smart program offers efficiency rebates that pair well with a solar installation.

Total potential savings in Florida: ~$1,000–$3,000 (tax exemptions + the ongoing value of full-retail net metering).

Other states with notable incentives

Values are approximate and vary by system size and utility. Check DSIRE.us for the most current information.^[16]

Utility-specific programs

Your electricity provider may offer additional incentives beyond what your state provides. Here are some of the most significant:

Pacific Gas & Electric (PG&E) — California

• Net Billing Tariff (export credits for solar excess)
• SGIP storage incentive (funding depleted for new standard applications as of early 2026)
• Time-of-Use rates that maximize solar value

ConEdison — New York

• Time-of-Use billing plan for solar customers
• Value of Distributed Resources (VDR) adders for solar

Austin Energy — Texas

• Time-of-Use rate that favors daytime solar production
• Net metering at retail rate

APS (Arizona Public Service) — Arizona

• Net metering at retail rate
• Time-of-Use rates optimized for solar

FPL (Florida Power & Light)

• Net metering at full retail rate
• Power Smart efficiency rebates (pair well with solar)

How to find your utility's program: Go to DSIREUSA.org — the Database of State Incentives for Renewables & Efficiency — and search by your ZIP code. It's the most comprehensive incentive database in the U.S.

Community solar: no panels on your roof

If you can't (or don't want to) install solar on your roof, community solar lets you subscribe to a share of a nearby solar farm. You get credits on your electric bill for the power your share produces.

Benefits in 2026:

• No upfront cost in most programs
• Typical savings of 5–15% on your electric bill
• No roof requirements, no maintenance
• Can move your subscription if you move within the same utility territory

Community solar is available in 35+ states as of 2026.^[17] The biggest programs are in New York, Massachusetts, Illinois, Minnesota, and Colorado.

How to find and apply for incentives

Here's a practical step-by-step guide:

Step 1: Check DSIREUSA.org

Enter your ZIP code. The Database of State Incentives for Renewables & Efficiency provides the most complete, up-to-date listing of all available incentives. It's updated daily and covers all 50 states.

Step 2: Check with your utility

Search "[your utility name] solar rebate" or call their customer service. Many utilities have programs that aren't widely advertised.

Step 3: Check with your state energy office

Every state has a Department of Energy or equivalent agency that administers state-level incentives. Search "[your state] department of energy solar incentives."

Step 4: Talk to your solar installer

Reputable installers know which incentives are available in your area and can factor them into your quote. Ask them to itemize all applicable incentives on your proposal.

Step 5: Check your local municipality

Some cities and counties offer additional rebates or expedited permitting for solar installations. Search "[your city] solar incentive" or ask your local building department.

Frequently asked questions

Is there really no federal tax credit anymore?

For residential installations (Section 25D), yes — the 30% credit expired December 31, 2025. There are ongoing legislative efforts in Congress to restore or extend some form of residential solar incentive, but as of September 2026 none has been enacted. Keep an eye on this — it could change before you install, so check the status of any bill your installer cites and verify the bill number directly on congress.gov before relying on it.^[18]

Can renters get any solar incentives?

Not directly. Tax credits require you to own the system, which you can't do as a renter. However, community solar programs are available to renters in most states. Some utilities also offer "solar for renters" programs where you subscribe to a share of a community solar farm.

Is there a limit on how much I can save with state incentives?

It varies by program. Some state tax credits have annual dollar limits (e.g., Arizona's $1,000/$2,000 cap). Others, like California's SGIP for batteries, have higher caps based on system size. Utility rebates may have limited funding pools that "close" when the allocated budget is spent — so timing matters.

What are SRECs and are they still worth anything?

Solar Renewable Energy Certificates (SRECs) represent the environmental attributes of one megawatt-hour of solar energy. Utilities in certain states must purchase SRECs to meet renewable portfolio standards. As of 2026, active SREC markets exist in: New Jersey, Massachusetts, Connecticut, Maryland, Delaware, Washington DC, Illinois, and Pennsylvania. Prices vary widely by state and program year — several markets have fallen well below their earlier highs — so check current prices before counting SREC revenue into your savings. A typical residential system generates 2–4 SRECs per year.^[19]

What if I don't qualify for any incentives?

Even without incentives, solar can still make financial sense — especially in states with high electricity rates (California, New York, Hawaii, Massachusetts). A 12 kW system in California at 30¢/kWh saves approximately $3,800/year in electricity. Even at $31,000 with no incentives, the payback period is roughly 8 years, and the system lasts 25–30 years.

Bottom line: incentives still matter — they just look different

The loss of the 30% federal tax credit is a real blow. It adds approximately $9,000 to the cost of a typical 12 kW system. No doubt about it.

But in many states, the combined value of state, local, and utility incentives still brings that cost down significantly:

The key is to research every available incentive before you sign a contract. Many homeowners leave $2,000–$5,000 on the table simply by not knowing what's available.

Start with DSIREUSA.org and check your utility's website. And if you want to see your personalized savings with incentives factored in, use our Solar Savings Calculator.

For more on financing options, check out our Solar Loans vs Cash vs HELOC guide and our PPA vs Lease vs Buying comparison.

Sources

1. One Big Beautiful Bill Act (P.L. 119-21), 2025 — expiration of Section 25D/25C residential credits. congress.gov
2. IRS guidance on the Section 25D expiration and DAC-SASH program. irs.gov
3. IRS Direct Pay — DAC-SASH Program. irs.gov
4. IRS Section 48E — Commercial Clean Energy Credit. irs.gov
5. IRS Section 30D — EV Charging Credit. irs.gov
6. California SGIP Program Guidelines, 2026. sgipenergy.com
7. California Revenue & Tax Code Section 333.3. leginfo.legislature.ca.gov
8. NY-Sun Megawatt Block Program. energizeamerica.com
9. New York Real Property Tax Law Section 487. legislation.nysenate.gov
10. Mass Solar Loan Program. massolarloan.com
11. Massachusetts General Laws Chapter 59 Section 5 Clause 4th. malegislature.gov
12. Connecticut Green Bank Solar Loan Program. ctgreenbank.com
13. Texas Senate Bill 1406. capitol.texas.gov
14. Arizona Revised Statutes Section 42-11331. azleg.gov
15. Florida Statute 196.198. leg.state.fl.us
16. DSIRE Database. dsireusa.org
17. Community Solar Barometer 2026. seia.org
18. Introduced legislation in the 119th Congress to restore/extend the residential solar credit (none enacted as of Sept 2026). congress.gov
19. SREC Monitor — State SREC Prices, Q3 2026. srecmonitor.com