Solar Panel Cost by State 2026: Complete Price Guide
Last updated: February 2026 · All 50 states · Post-ITC repeal pricing
How much do solar panels cost in your state? Installation costs, electricity rates, payback periods, and available incentives vary dramatically across the United States. This guide covers all 50 states with estimated per-watt costs, local incentive programs, and net metering policies -- updated for 2026 after the repeal of the federal residential solar tax credit (Section 25D).
National Overview
The average cost of a residential solar panel system in 2026 ranges from $2.60 to $3.80 per watt installed, depending on your state. For a typical 8 kW system, that means $20,800 to $30,400 before any state or local incentives. The national weighted average is approximately $3.00-$3.50 per watt.
The most significant change in 2026 is the repeal of the 30% federal residential solar tax credit (Section 25D). This effectively increases the out-of-pocket cost for homeowners by approximately 30% compared to 2025. However, declining equipment prices (panels have dropped roughly 15% since 2024), rising electricity rates, and sustained state incentive programs in many states continue to make solar economically viable in most of the country.
Key factors driving state-by-state variation include: local labor costs and permitting requirements, electricity rates (ranging from 11 cents/kWh in Idaho to 43 cents/kWh in Hawaii), solar irradiance (peak sun hours), net metering policies, and state incentive programs. States with high electricity rates tend to have faster payback even if installation costs are higher.
50-State Solar Cost Table
Average installed cost per watt, electricity rates, peak sun hours, estimated payback period, state incentives, and net metering status for all 50 states. Click a state name to view its full solar guide with detailed local data.
| State | Avg $/W | Elec. Rate (c/kWh) | Peak Sun Hrs | Est. Payback (yr) | State Incentives | Net Metering |
|---|---|---|---|---|---|---|
| Alabama (AL) | $2.80 | 14.0 | 4.4 | 14 | None | Limited |
| Alaska (AK) | $3.20 | 24.0 | 2.5 | 18 | None | Limited |
| Arizona (AZ) | $3.00 | 14.0 | 6.5 | 10 | State tax credit (25%, up to $1K), property tax exemption | Net billing (varies by utility) |
| Arkansas (AR) | $2.60 | 12.0 | 4.7 | 14 | Net metering | Full retail |
| California (CA) | $3.30 | 32.0 | 5.8 | 9 | SGIP battery rebate, property tax exclusion, DAC-SASH | NEM 3.0 (net billing) |
| Colorado (CO) | $3.00 | 15.0 | 5.5 | 11 | Xcel Solar*Rewards, property & sales tax exemptions | Full retail |
| Connecticut (CT) | $3.50 | 27.0 | 3.8 | 10 | RSIP, property tax exemption, sales tax exemption | Full retail |
| Delaware (DE) | $3.10 | 14.0 | 4 | 13 | Green Energy Fund grants, SRECs | Full retail |
| Florida (FL) | $3.05 | 16.0 | 5.4 | 11 | Property & sales tax exemptions | Full retail |
| Georgia (GA) | $3.10 | 14.0 | 4.6 | 13 | Minimal state incentives | Limited |
| Hawaii (HI) | $4.00 | 43.0 | 5.3 | 7 | State tax credit (35%), property tax exemption | Customer self-supply / grid-supply plus |
| Idaho (ID) | $2.80 | 11.0 | 4.7 | 15 | Property tax exemption | Full retail |
| Illinois (IL) | $3.10 | 16.0 | 3.9 | 11 | IL Shines SRECs, property tax exemption | Full retail |
| Indiana (IN) | $2.90 | 14.0 | 3.8 | 14 | Minimal | Phasing out |
| Iowa (IA) | $2.90 | 14.0 | 4.1 | 13 | Property tax exemption | Full retail |
| Kansas (KS) | $2.80 | 14.0 | 4.9 | 12 | Property tax exemption | Full retail |
| Kentucky (KY) | $2.80 | 12.0 | 3.9 | 16 | Minimal | Limited |
| Louisiana (LA) | $2.70 | 12.0 | 4.5 | 14 | Property tax exemption | Full retail |
| Maine (ME) | $3.10 | 22.0 | 3.8 | 10 | Property tax exemption, sales tax exemption | Net billing |
| Maryland (MD) | $3.20 | 16.0 | 4.1 | 11 | SRECs, property tax exemption, sales tax exemption | Full retail |
| Massachusetts (MA) | $3.50 | 29.0 | 3.8 | 8 | SMART program, state tax credit (15%), property & sales tax exemptions | Full retail (<10 kW) |
| Michigan (MI) | $3.00 | 18.0 | 3.5 | 13 | Minimal | Outflow credits |
| Minnesota (MN) | $3.10 | 14.0 | 3.9 | 14 | Xcel Solar*Rewards, Made in MN rebate | Full retail |
| Mississippi (MS) | $2.70 | 13.0 | 4.4 | 14 | None | None mandated |
| Missouri (MO) | $2.80 | 13.0 | 4.3 | 13 | Property tax exemption | Full retail |
| Montana (MT) | $3.00 | 13.0 | 4.5 | 14 | Property tax exemption, alternative energy credit | Full retail |
| Nebraska (NE) | $3.00 | 12.0 | 4.6 | 15 | Minimal | Limited |
| Nevada (NV) | $3.05 | 14.0 | 6.2 | 10 | Partial sales & property tax exemptions | Net billing (~75% retail) |
| New Hampshire (NH) | $3.20 | 22.0 | 3.7 | 10 | Rebate program, property tax exemption | Full retail |
| New Jersey (NJ) | $3.20 | 18.0 | 4.2 | 9 | ADI ($90-$100/MWh for 15 yr), property & sales tax exemptions | Full retail |
| New Mexico (NM) | $3.00 | 14.0 | 6.3 | 10 | Solar Market Development Tax Credit (10%) | Full retail |
| New York (NY) | $3.40 | 24.0 | 3.8 | 8 | NY-Sun ($0.20-$0.40/W), state tax credit (25%, up to $5K), property & sales tax exemptions | Full retail / VDER |
| North Carolina (NC) | $3.00 | 13.0 | 4.7 | 12 | 80% property tax exemption, Duke Energy rebates | Full retail |
| North Dakota (ND) | $3.00 | 12.0 | 4.2 | 16 | Minimal | Limited |
| Ohio (OH) | $2.90 | 14.0 | 3.6 | 14 | SRECs, property tax exemption | Full retail |
| Oklahoma (OK) | $2.60 | 12.0 | 4.9 | 13 | Minimal | Limited |
| Oregon (OR) | $3.10 | 13.0 | 3.7 | 14 | Solar + Storage Rebate, property tax exemption | Full retail |
| Pennsylvania (PA) | $3.10 | 16.0 | 3.7 | 12 | SRECs, sales tax exemption | Full retail |
| Rhode Island (RI) | $3.30 | 24.0 | 3.9 | 9 | REF grants, property & sales tax exemptions | Full retail |
| South Carolina (SC) | $2.80 | 14.0 | 4.6 | 12 | State tax credit (25%), property tax exemption | Full retail |
| South Dakota (SD) | $2.90 | 13.0 | 4.5 | 14 | Property tax exemption | Limited |
| Tennessee (TN) | $2.80 | 12.0 | 4.2 | 15 | TVA Green Connect | TVA programs |
| Texas (TX) | $3.00 | 14.0 | 5.3 | 11 | Property tax exemption, utility rebates (Austin, CPS) | No mandate; buyback plans vary |
| Utah (UT) | $3.00 | 12.0 | 5.6 | 13 | State tax credit ($400-$1,600), property tax exemption | Net billing (declining rate) |
| Vermont (VT) | $3.20 | 21.0 | 3.6 | 10 | State incentive program, sales tax exemption | Full retail |
| Virginia (VA) | $3.00 | 13.0 | 4.2 | 13 | Property tax exemption, SRECs | Full retail |
| Washington (WA) | $3.30 | 12.0 | 3.3 | 16 | Sales tax exemption, property tax exemption | Full retail |
| West Virginia (WV) | $2.90 | 13.0 | 3.7 | 15 | Minimal | Limited |
| Wisconsin (WI) | $3.00 | 16.0 | 3.7 | 13 | Focus on Energy rebates, sales tax exemption | Full retail |
| Wyoming (WY) | $3.00 | 12.0 | 5.1 | 14 | Net metering | Full retail |
Costs are estimates based on 2026 market data and regional averages. Actual costs vary by installer, system size, and site conditions. Payback estimates assume full self-consumption. Use our payback calculator for a personalized estimate.
10 Cheapest States for Solar Installation
States in the South and lower Midwest consistently offer the lowest installation costs, driven by lower labor rates, simpler permitting, and competitive installer markets. However, low installation cost does not always equal the best deal. These states often have lower electricity rates, which means the savings per kWh generated are smaller. For an 8 kW system, the cheapest states save $4,000-$8,000 compared to the most expensive states on installation alone.
| Rank | State | Avg $/W | 8 kW System Cost | Elec. Rate (c/kWh) | Payback (yr) |
|---|---|---|---|---|---|
| 1 | Arkansas | $2.60 | $20,800 | 12.0 | 14 |
| 2 | Oklahoma | $2.60 | $20,800 | 12.0 | 13 |
| 3 | Louisiana | $2.70 | $21,600 | 12.0 | 14 |
| 4 | Mississippi | $2.70 | $21,600 | 13.0 | 14 |
| 5 | Alabama | $2.80 | $22,400 | 14.0 | 14 |
| 6 | Idaho | $2.80 | $22,400 | 11.0 | 15 |
| 7 | Kansas | $2.80 | $22,400 | 14.0 | 12 |
| 8 | Kentucky | $2.80 | $22,400 | 12.0 | 16 |
| 9 | Missouri | $2.80 | $22,400 | 13.0 | 13 |
| 10 | South Carolina | $2.80 | $22,400 | 14.0 | 12 |
10 Fastest Payback States
Payback speed depends on the combination of electricity rates, solar production, and state incentives -- not just installation cost. Hawaii leads the nation with a 7-year payback despite the highest installation costs ($4.00/watt) because its electricity rate ($0.43/kWh) is three times the national average. Massachusetts and New York offer 8-year paybacks through a combination of high rates and generous state incentive stacks. California's fast payback is driven by the nation's highest electricity rates ($0.32/kWh) despite premium installation costs.
| Rank | State | Payback (yr) | Elec. Rate (c/kWh) | Peak Sun Hrs | Avg $/W | Key Driver |
|---|---|---|---|---|---|---|
| 1 | Hawaii | 7 | 43.0 | 5.3 | $4.00 | High electricity rate |
| 2 | Massachusetts | 8 | 29.0 | 3.8 | $3.50 | High electricity rate |
| 3 | New York | 8 | 24.0 | 3.8 | $3.40 | High electricity rate |
| 4 | California | 9 | 32.0 | 5.8 | $3.30 | High electricity rate |
| 5 | New Jersey | 9 | 18.0 | 4.2 | $3.20 | Strong state incentives |
| 6 | Rhode Island | 9 | 24.0 | 3.9 | $3.30 | High electricity rate |
| 7 | Arizona | 10 | 14.0 | 6.5 | $3.00 | Excellent solar resource |
| 8 | Connecticut | 10 | 27.0 | 3.8 | $3.50 | High electricity rate |
| 9 | Maine | 10 | 22.0 | 3.8 | $3.10 | Good rate + sun combo |
| 10 | Nevada | 10 | 14.0 | 6.2 | $3.05 | Excellent solar resource |
ITC Repeal Impact: How Each State Is Affected
The repeal of Section 25D (the 30% residential solar Investment Tax Credit) in early 2026 removed the single largest financial incentive for homeowners going solar. However, the impact varies significantly by state:
Least Affected: States with Strong Alternative Incentives
New York, New Jersey, Massachusetts, Connecticut, Rhode Island -- These states have robust state-level incentive programs that partially compensate for the lost federal credit. New York's combination of NY-Sun rebates ($0.20-$0.40/watt), a 25% state tax credit (up to $5,000), and property/sales tax exemptions can still reduce total costs by 40-50%. New Jersey's ADI program provides $90-$100/MWh for 15 years, generating $13,000-$15,000 in production-based income. Massachusetts' SMART program adds $0.03-$0.10/kWh for 10 years. See our ITC repeal guide for details.
Moderately Affected: States with Some Incentives
California, Colorado, Illinois, Maryland, Oregon, South Carolina -- These states have meaningful but more modest incentive programs. California's SGIP battery rebate and property tax exclusion help, but the NEM 3.0 net billing tariff already reduced solar economics. Colorado's Xcel Energy Solar*Rewards and property/sales tax exemptions soften the blow. Illinois' IL Shines SRECs provide ongoing income. The payback period in these states has increased by approximately 2-3 years post-ITC.
Most Affected: States with No State Incentives
Alabama, Mississippi, Kentucky, Tennessee, Indiana, West Virginia, North Dakota -- These states had no state solar incentives, so the federal ITC was the only significant financial support. Without it, homeowners face the full installed cost with no offsets beyond basic net metering (where available). The payback period has effectively increased by 3-5 years. Solar is still viable in these states for homeowners with high electricity consumption, but the financial case is weaker.
Important: The commercial solar ITC (Sections 48/48E) remains at 30%. This means third-party ownership models (solar leases and PPAs) can still leverage the commercial credit, offering homeowners a zero-down path to solar savings even without the residential credit. See our 2026 Solar Tax Credit guide for full details.
Frequently Asked Questions
How much do solar panels cost in 2026 without the federal tax credit?
The national average installed cost in 2026 ranges from $2.60 to $3.80 per watt, depending on your state. For a typical 8 kW system, that translates to $20,800-$30,400 before any state or local incentives. The repeal of the 30% federal residential solar tax credit (Section 25D) in early 2026 increased the effective cost for homeowners by 30% compared to 2025. However, state incentives, declining equipment costs, and rising electricity rates continue to make solar a worthwhile investment in most states.
Which state is the cheapest for solar panels?
Based on our data, states in the South and Midwest tend to have the lowest installation costs. Oklahoma and Arkansas average around $2.60/watt, while Alabama, Louisiana, and Mississippi average $2.70/watt. However, the cheapest states for installation are not necessarily the best states for solar ROI -- states with high electricity rates (Massachusetts, Connecticut, California) often have faster payback periods despite higher installation costs.
What is the payback period for solar panels without the ITC?
Without the federal ITC, typical payback periods range from 7 to 18 years depending on your state. Hawaii (7 years), Massachusetts (8 years), and New York (8 years) offer the fastest payback thanks to high electricity rates and strong state incentives. States with low electricity rates and few incentives, like Alaska (18 years) and North Dakota (16 years), have the longest payback periods. Adding battery storage can extend payback by 2-4 years but provides backup power value.
Does net metering still exist in 2026?
Net metering policies vary significantly by state. As of 2026, approximately 35 states still offer some form of net metering, though many are transitioning to net billing or time-of-use export credits. States with full retail net metering (New York, New Jersey, Florida, Illinois) provide the most value for solar exports. California switched to NEM 3.0 (net billing) in 2023, dramatically reducing export credits. Check your state-specific page on our site for the latest policy details.
How does the ITC repeal affect solar costs differently by state?
The ITC repeal impacts states unequally. States with strong alternative incentives (New York, New Jersey, Massachusetts, Connecticut) are partially buffered because their state programs offset the lost federal credit. States with no state incentives (Alabama, Mississippi, Tennessee) feel the full impact -- effectively a 30% price increase. States with no income tax (Florida, Texas, Nevada) were always unable to fully use the ITC for state tax benefits, so the practical impact is smaller than for high-tax states where the credit provided the most value.
Related Guides
Last updated: February 2026. Cost estimates based on market data, state incentive program details, and regional averages. Actual costs vary by installer, system size, roof type, and local permitting. Consult a licensed installer for a site-specific quote.