States with the strongest 2026 incentives
If you live in any of these states, your effective net cost can drop substantially even without the federal credit.
New York
- State tax credit: 25% of system cost, capped at $5,000
- NY-Sun rebate: per-watt incentive that varies by region
- Net metering: full retail value for exports
- Combined effect: typically $4,000–$8,000 in stacked incentives
Massachusetts
- SMART program: performance-based payment for ~10 years (varies by utility and project size)
- State tax credit: 15% capped at $1,000
- Net metering: available, full retail in most areas
New Jersey
- SuSI / SREC-II: performance payments via state-issued solar renewable energy certificates
- Sales tax exemption on solar equipment
- Property tax exemption: solar doesn't increase your assessed value
South Carolina
- State tax credit: 25% of system cost, capped at $3,500/year (carry forward up to 10 years)
- Net metering: available with utilities like Duke and Dominion
Hawaii
- State tax credit: 35% of system cost, capped at $5,000 per system
- Battery rebates available through utility programs
- Combined with the highest electric rates in the US, Hawaii still has the fastest payback in 2026
Maryland
- Residential clean energy grant: $1,000 flat rebate
- SREC market: ongoing performance payments
- Property tax exemption on added home value
Illinois
- Illinois Shines program: upfront SREC purchase from the state
- Property tax exemption on solar additions
- Net metering: still available, though under review
States with mid-tier incentives
Colorado: Xcel Energy Solar Rewards (varies); state sales/use tax exemption.
Connecticut: Residential Solar Investment Program (declining block); sales tax exemption.
Iowa: State tax credit (up to 15%, capped); property tax exemption.
New Mexico: 10% state tax credit, capped at $6,000.
Rhode Island: Renewable Energy Growth program; net metering.
Texas: No statewide credit, but utility rebates from Austin Energy, Oncor, CPS Energy, and Guadalupe Valley Electric Co-op can be substantial.
Vermont: Net metering credits; property tax exemption.
States with minimal incentives
In these states, you're largely relying on net metering and federal commercial ITC pass-through (lease/PPA only): Alabama, Arkansas, Georgia, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Missouri, Montana, Nebraska, North Dakota, Oklahoma, South Dakota, Tennessee, West Virginia, Wyoming.
Solar can still pay off in these states if your electric bill is high enough — but the math is tighter without state stacking. See solar cost by state for typical paybacks.
Utility-specific rebates worth knowing
- Xcel Energy (CO, MN, WI): Solar Rewards program, performance-based
- Austin Energy (TX): Value of Solar tariff plus upfront rebate
- CPS Energy (San Antonio): per-watt rebate
- Duke Energy (NC, SC): rebates and net metering
- Ameren Missouri: $0.25/W rebate
- Pacific Power (OR): Energy Trust of Oregon incentives
How to stack incentives properly
The order incentives apply matters. Most state tax credits and rebates are calculated on the gross system cost (before any other incentive). SREC and performance payments are calculated on production. To maximize, claim:
- Upfront utility rebates (reduces gross cost)
- State tax credits (calculated on remaining cost or gross, depending on state)
- Performance-based incentives (SREC, SMART, NY-Sun) over time
- Net metering credits monthly
See your full incentive stack on your bid
Upload your solar proposal — the analyzer cross-references your state and utility and tells you what incentives you should be claiming.
Analyze My Bid →Frequently asked questions
Did the federal credit's expiration affect state programs?
No directly. State programs are independently funded and administered. However, some state programs designed to "stack" with the federal credit may see increased uptake or budget pressure.
Are SRECs still valuable?
Yes, in active SREC states (NJ, MD, MA, DC, OH, IL, PA). Prices fluctuate quarterly. A typical 8 kW system can earn $300–$2,000/year in SRECs depending on state market.
What about IRA-funded state rebate programs?
The HOMES and HEEHRA rebate programs (residential energy efficiency, including some solar adders) are rolling out at different speeds in different states. Check your state energy office for current status.
Can I claim a state credit if I lease?
No. State tax credits go to the system owner, which on a lease is the solar company. The lease company should reflect that benefit in your monthly payment.