Have you ever wondered how your state stacks up in the solar energy game? Well, you’re about to find out. This article takes a close look into solar savings, incentives, and growth across the U.S. We’ve crunched the numbers, analyzed the data from reputable sources like the Solar Energy Industries Association (SEIA), SolarReviews, and the U.S. Energy Information Administration (EIA), and are ready to guide you through what solar power could mean for your wallet and your world. Find out which states are solar powerhouses and which are falling behind.
Key Takeaways
- Nevada (34,728) and Hawaii (33,685) are the states with the most solar panel installations per capita.
- Texas and California are projected to have the most solar power growth in the next 5 years.
- Solar panels installed in Hawaii, Florida, and Connecticut offer the quickest return on investment (for a 10kW system).
- Hawaii and Connecticut have the highest estimated solar savings: $2,360 and $1,734 per year.
- Hawaii offers the largest state tax incentive for going solar: 35%, up to $5,000.
Solar Energy Leaders in the U.S.
Use the interactive map below to see the progress of solar energy across the country. It highlights how each state is performing in terms of residential solar energy adoption and use based on SEIA data.
As we explore solar energy across the United States, it’s clear that some states are forging ahead in harnessing the sun’s power. California, Nevada, and Massachusetts topped the list of 50 states with an impressive 27.8%, 25.3%, and 24.5% of their electricity sourced from solar power, respectively. This showcases these states’ commitment to renewable energy and sets a benchmark other states can aspire to.
Regarding solar panel installations per capita, Nevada (34,728) and Hawaii (33,685) emerged as frontrunners, illustrating a significant number of solar-powered homes. These states contrasted sharply with North Dakota (23) and West Virginia (188), where solar-powered homes per capita were notably the fewest. Such disparities highlight the varied adoption rates of solar energy across the country.
Looking to the future, Texas is poised for the most remarkable growth in solar power, followed by California. Texas’ projected increase of 38,523 megawatts and California’s anticipated growth of 20,767 megawatts in the next five years signal the most robust solar energy infrastructure expansion. Notably, California’s colossal $97 billion investment in solar underscores its leading role in the solar energy revolution. Texas has invested the second-most into solar: $24 billion as of the end of 2023.
Solar Savings by State
We used data from the EIA and EcoWatch to create the state-by-state solar savings chart below. See how solar investments can pay off in your state.
The top 10 states with the highest estimated annual savings from solar were:
- Hawaii $2,360
- Connecticut $1,734
- Florida $1,668
- Alabama $1,638
- Georgia $1,578
- New Hampshire $1,563
- Tennessee $1,553
- Louisiana $1,538
- Massachusetts $1,534
- Maryland $1,522
The estimated annual savings from solar in the top 10 states offered a positive outlook. Hawaii led with an average savings of $2,360, then Connecticut at $1,734 and Florida at $1,668. Alabama, Georgia, New Hampshire, and Tennessee followed close behind. Louisiana, Massachusetts, and Maryland rounded out the top 10, each with annual savings of over $1,500.
These figures demonstrate the economic benefits of solar energy, but how long does it take for those annual savings to pay for the cost of installing a solar power system?
Since the average residential solar systems fall between 5 and 10kW, we estimated the payback period for a 10kW system in each state. Hawaii, Florida, and Connecticut were at the forefront for the quickest ROI paybacks, with homeowners likely to break even on a 10 kW system at 10.1, 12,8, and 14.1 years, respectively. This could be a deciding factor for homeowners in different parts of the U.S. considering installing solar panels. Keep in mind that actual solar system sizes may vary based on electricity consumption, sunlight, and exact location.
See Your Solar Savings
We’ve made it easy to understand the financial benefits of going solar in your specific location.
To discover your potential solar savings with our easy-to-use calculator below, simply enter your state, home size, and last month’s electric bill — our tool will do the rest.
It estimates your average monthly and annual energy usage, calculates the ideal system size for your needs, and factors in state-specific costs and the 30% federal Residential Clean Energy tax credit. You’ll also receive a personalized estimate of the net solar installation cost, monthly electricity bill, annual savings, and state incentives.
State-Level Solar Incentives
To wrap up our study, we analyzed the various financial benefits available to homeowners in different states. The map below is a visual guide to how each state supports the transition to solar energy (or doesn’t).
Beyond the energy cost savings of going solar, financial incentives make solar investments even more appealing and affordable in the U.S. The federal solar Investment Tax Credit (ITC) is at the forefront of these, offering a substantial 30% deduction on solar installations. Many states further sweeten the deal with additional benefits like property and sales tax exemptions, making solar investments more viable.
Hawaii led these efforts with an impressive state tax incentive of 35%, capped at $5,000, offering the most substantial state-level incentive for solar adoption. New York solar incentives and tax credits also encouraged solar growth. Residential systems up to 25 kW are eligible for net metering services from utility companies and rebates ranging from $200 to $400 per kW from a state incentive program. New Yorkers can also benefit from a 25% state solar tax credit on installation costs.
In Texas, homeowners installing solar panels can benefit from property tax exemptions, which reduce the tax impact of solar-equipped homes. Although there’s no statewide net metering policy, some utility companies in this state offer similar benefits. Residents may also qualify for a solar panel tax credit in Texas. These incentives collectively enhance solar energy’s accessibility and financial appeal for Texas residents.
States With Solar Buyback Programs
When homes produce more solar energy than they use, the surplus electricity can be fed back into the power grid via net metering or stored in batteries. In some states, homeowners are compensated for this extra energy, lowering their utility bills. Explore the map below to see the programs available in your area.
Based on CNET data, net metering policies in Texas aren’t uniform statewide and instead vary depending on the utility company. Homeowners considering solar panels should research their utility company’s policies to understand how excess solar energy will be credited or compensated. The same can be said for residents of Alabama, Georgia, Idaho, South Dakota, and Tennessee.
We also determined that four states have net billing: Arizona, California, Maine, and Utah. While similar to net metering, net billing offers a lower compensation rate. Net metering means you’ll receive retail value for your surplus electricity, while net billing pays wholesale prices.
Solar buyback programs and net metering vary by state and utility company but can encourage the adoption of solar energy through financial incentives.
A Bright Future With Solar
As we conclude our exploration of solar energy in the U.S., it’s evident that California, Nevada, and Massachusetts are leading the way in solar power generation as well as buyback programs and incentives. But, Texas was projected to have the most solar power growth over the next five years. With substantial savings, tax incentives, and increased accessibility, making your home more energy efficient could be within reach.
As solar technology evolves, this renewable energy can be a path to environmental sustainability and a financially savvy choice for homeowners nationwide. The shift toward solar energy represents a step toward a greener future and a smart economic move for individuals and communities alike.
Methodology
We collected state-level residential solar use data from the Solar Energy Industries Association (all data was current through Q4 2023), state-level solar incentive data from SolarReviews, and net metering data from CNET December 2023.
We used U.S. Energy Information Administration (EIA) 2022 residential electricity data to estimate the average energy consumption per customer. EIA was also our source for the average cost of electricity in 2022.
The cost of solar power per watt came from EcoWatch data, which allowed us to determine the installation cost for a 10-kW system. We applied the 30% federal tax credit to each system, and estimated yearly savings and ROI payback period for each state. However, solar production can vary by exact location and sunlight. Solar savings calculations assumed the panels would cover 100% of electricity usage.
Our solar calculator tool estimated the system size based on the user’s input of their last electricity bill, home size, and the state’s average peak sunlight hours, using an efficiency factor of 80%. To estimate the maximum system size a home could support, we used the rule of thumb that each kilowatt of solar takes 100 square feet. These are estimates and may not be 100% accurate, as this can vary based on specific location and utility company.
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Fair Use Statement
This article is created for educational purposes, offering an insightful look into the adoption and benefits of solar energy in the U.S. You’re welcome to share this article for non-commercial use, ensuring to include a link back to this page, allowing others to access the full content and our methodology.
