Texas Solar Buyback Plans (2026): How They Work

Texas has no statewide net metering. In the deregulated retail market (most of the state), you only get credit for exported solar power if you choose a retail electric provider plan with a "solar buyback" provision — and the terms vary widely by plan.

The same rooftop can produce meaningfully different annual savings depending on the plan you pick. If you're in a city-owned, co-op, or regulated-utility area instead, the utility sets its own rule — often a published fixed rate, sometimes retail credit capped at your monthly usage.

This guide explains how solar buyback works in Texas in 2026, the three kinds of plans you'll see, the four lines to check in any plan's terms before you sign, why an "installer-recommended" plan isn't always the right one, and how the buyback rule should change the size of the system you buy in the first place. It's written for a homeowner holding a solar quote, so it also covers the mistake we see most often in Texas proposals: savings math built on a buyback rate the homeowner will never actually get.

Does Texas have net metering?

No. Texas has never adopted a statewide net-metering rule. In most states, net metering is something the state's utility regulator imposes on utilities: a solar home's exported kilowatt-hours are credited at (or near) the retail price, and the meter effectively runs backwards.

Most Texans — the bulk of the ERCOT grid, including Dallas–Fort Worth, Houston, and much of the rest of the state — live in the deregulated retail market, where the company that sells you electricity (the REP — TXU, Reliant, Gexa, Rhythm, Green Mountain and dozens more) is separate from the company that delivers it and owns the wires and meter (the TDU — Oncor, CenterPoint, AEP Texas, TNMP, or Lubbock Power & Light, depending on where you live). The state doesn't tell REPs what to pay for your solar. Some REPs choose to offer buyback plans as a product; many don't. If you're on a plan with no buyback provision, your exported power goes to the grid for free.

The rest of the state — municipal utilities and electric cooperatives (Austin Energy, CPS Energy in San Antonio, and dozens of smaller ones), plus the regulated utilities outside ERCOT such as El Paso Electric, Entergy Texas, Xcel Energy, and SWEPCO — isn't in the retail-choice market. Each of those utilities sets its own solar rule. Rules vary: some publish a fixed export rate (Austin Energy's "Value of Solar" rate is the best-known), others credit exports at your retail rate up to your monthly usage and pay little or nothing for the surplus (CPS Energy and several co-ops work this way), and several pair that with a rebate program that opens and closes with budget cycles. If you're a muni, co-op, or regulated-utility customer, skip the REP-shopping sections below and read your utility's solar tariff page — it's the whole story.

How does a solar buyback plan work?

Mechanically, three things happen once your system is turned on:

1. Your TDU provisions a bidirectional meter — usually by reprogramming your existing smart meter to add an export channel — after interconnection is approved. It measures electricity flowing in (imports) and out (exports) separately. In the deregulated TDU territories, smart meters record in 15-minute intervals, so the utility knows exactly when you exported and how much.
2. Your REP bills you for imports at the plan's energy rate, and your bill also carries the TDU's delivery charges on every imported kilowatt-hour, plus the TDU's fixed monthly charge. Solar doesn't remove the delivery charges on the power you still pull from the grid at night.
3. Your REP credits you for exports according to the plan's buyback terms — a rate per exported kWh, a cap, and a rollover rule. This is the part that varies, and it's the part the rest of this article is about.

The key thing to understand: an imported kWh costs you the energy rate plus delivery; an exported kWh is typically credited at the energy rate only. So even a plan that advertises "1-to-1" or "retail-match" credit usually isn't matching your full all-in cost of a kWh — it's matching the energy portion. That gap is normal and disclosed, but it means exported power is worth less than the power you consume directly from your panels. That single fact drives most of the sizing advice at the end of this article.

What are the 3 types of solar buyback plans in Texas?

1. Retail-match ("1:1") credit plans

Exports are credited at the same energy rate you pay for imports. This is the closest thing Texas has to net metering, and it's the structure most solar-quote savings math assumes. Two things to check: whether the credit is capped at your monthly consumption (below), and whether the plan's energy rate is higher than a comparable non-solar plan from the same REP. Some REPs price the solar plan's import rate above their standard plans, which quietly claws back part of the buyback value. Compare the plan's Electricity Facts Label (EFL) to the same REP's non-solar EFL at the same term length.

2. Fixed-rate buyback plans

Exports are credited at a stated rate — often several cents per kWh below the import rate. These plans are simpler and sometimes come with a lower import rate than the retail-match plans, which can make them competitive for a home that consumes most of its own production and exports little. Whether one beats a retail-match plan depends on your export share, which is why you need the production and usage numbers from your proposal, not just the rates.

3. Real-time (wholesale-indexed) plans

Exports are credited at ERCOT's real-time wholesale price at the moment you export — which can be very low on a mild sunny afternoon when the whole state is exporting (it can drop to zero or even negative), and briefly very high during a grid emergency. These plans reward homes with batteries that can hold power and export when prices spike; for a panels-only home they're a bet on volatility, and on a typical spring day the credit may be a fraction of your import rate. Read them as a battery product, not a panel product.

REPs that have offered solar buyback plans in the deregulated market include TXU, Reliant, Green Mountain, Rhythm, Chariot, and Gexa; offerings change each term, so check the REP's current solar page rather than relying on a list.

What should you check on a Texas solar buyback plan before signing?

Every Texas retail plan comes with an EFL, a standardized disclosure the state requires. The EFL only tells you whether the REP buys back exports (a yes/no line); the rate, cap, and rollover terms are usually in the Terms of Service or a solar addendum, so pull both. The four lines that decide the plan:

1. The cap

Many plans credit exports only up to the amount of electricity you imported in the same billing month ("capped"); anything beyond that is forfeited. Others credit everything ("uncapped"). For a system sized to your annual usage, the cap bites in spring and fall — months when production is high and your air conditioner isn't running — and can erase a meaningful share of your credit. If the plan is capped, your system should be sized to your monthly consumption pattern, not to your annual total.

2. Rollover and expiration

If you earn more credit than your bill in a month, does the surplus roll forward? For how long? Does it expire at the end of the contract term, or when you switch plans? Can it ever be paid out as cash? (Typically: no.) A large bank of credits you can't use is a large bank of nothing, and switching REPs to chase a better rate can forfeit it. Know the rule before you build up a balance.

3. The term, and what happens when it ends

Texas retail contracts run a fixed term — commonly 12, 24, or 36 months. When it ends, if you don't actively choose a new plan, REPs typically roll you to a month-to-month default plan, and there is no guarantee that default plan carries any buyback at all. Put the expiration date in your calendar. Also check the early termination fee: solar plans are still retail contracts, and switching plans mid-term costs what the EFL says it costs. Moving is different: Texas rules bar an early termination fee when you relocate and give the REP a forwarding address.

4. The import rate, base charge, and TDU pass-through

Because solar plans are shopped by people focused on the buyback rate, some carry a higher energy rate or base charge on the import side. Compare the plan's average price per kWh at your usage level against the same REP's non-solar plan — the EFL prints it at 500, 1,000, and 2,000 kWh. And remember the TDU delivery charges pass through on every plan; they're set by the TDU, not the REP, so they don't differentiate plans, but they do determine how much of your bill solar can actually touch. Our Texas TDU charge audit walks through what's on that side of the bill.

Why the installer's savings math might be wrong

Many of the Texas proposals we review assume a retail-match, uncapped buyback at the current energy rate, held flat or escalated for 25 years. That assumption produces the biggest possible savings figure, and it fails in four separate ways:

• The plan may be capped — spring and fall exports forfeited.
• The credit excludes delivery charges — exports are worth less than the model assumes.
• The plan lasts 12–36 months, not 25 years — the buyback terms you sign up under aren't the ones you'll have in year 10.
• The plan's own import rate may be higher than the rate the proposal used for the "before solar" bill.

None of those is dishonest on its own; together they can overstate savings by a wide margin.

Ask the installer three questions: Which specific plan did you model? What buyback rate, cap, and rollover rule did you use? What percentage of my production do you expect me to export? If they can't answer the third question, they didn't size the system for a buyback market — they sized it to hit a number. Whoever reviews the proposal — you or an independent reviewer — should re-run the savings with the actual plan terms and a realistic export share before the contract is signed.

How the buyback rule should change your system size (and whether you add a battery)

In a true net-metering state, oversizing is cheap insurance: every extra kWh is worth retail. In Texas, every exported kWh is worth less than a consumed one — sometimes much less — so the economics favor a system sized to your daytime self-consumption plus a modest export, not to 100% of your annual usage. Practical rules of thumb:

• On a capped retail-match plan, size to your lower-usage months, not your annual average, so you aren't forfeiting spring and fall production.
• On a fixed-rate buyback that pays well below your import rate, every kWh you shift from export to self-consumption is worth the difference — which is the economic case for a battery in Texas. It's a different case than in net-metering states, where a battery is mostly about outage backup. Our guide to whether solar batteries are worth it in 2026 covers the math.
• On a real-time plan, a panels-only system is exposed to low midday prices; the plan is designed for batteries that export during price spikes. Don't sign one without storage unless you understand the exposure.
• Whatever the plan, get the proposal's assumed export percentage and check that it's consistent with the plan you'll actually be on. A home with two adults at work all day exports far more than a home with someone there running the AC at 2 p.m.

For system sizing in general — usage, roof, and production — see what size solar system you need; the Texas twist is simply that the buyback rule pulls the right answer smaller than the generic method does.

Does Texas have a solar tax credit or rebates?

No state tax credit — Texas has no state income tax. And the federal 30% residential credit under section 25D ended for systems whose installation was completed after December 31, 2025 — a Texas quote showing it in 2026 is a red flag, not a bonus. What Texas does have: a property-tax exemption for the value solar adds to your home (so a solar-improved home isn't reassessed upward for the system — you claim it by filing Form 50-123 with your county appraisal district), rebates from some municipal utilities and co-ops when their programs are open, and the buyback plans described above. For the cost side, our Texas solar cost guide covers price per watt; the broader Texas solar overview covers market context.

Texas solar buyback FAQ

Do I have to switch electricity providers when I go solar in Texas?

Usually yes, if your current plan has no buyback provision. Exports on a non-buyback plan are sent to the grid uncredited. Compare plans before interconnection so you're not exporting for free during the first billing cycle.

Can I get paid cash for excess solar credits in Texas?

On most plans, no. Credits offset your bill and either roll forward or expire under the plan's rules. Check the Terms of Service before assuming a surplus has cash value.

Does my TDU (Oncor, CenterPoint, AEP Texas, TNMP) affect my buyback rate?

No. The TDU provisions the meter and bills delivery charges; the buyback rate comes entirely from the REP plan you choose.

Before you sign: the Texas checklist

1. Confirm which market you're in — deregulated (you pick a REP) or a muni / co-op / regulated utility (the utility sets the rule).
2. Read the modeled plan's Terms of Service for the cap, rollover, expiration, and early termination fee.
3. Compare that plan's import rate and base charge to the same REP's non-solar plan at the same term.
4. Ask for the proposal's assumed export percentage and buyback rate; recompute the savings with the real plan.
5. Size to self-consumption, and evaluate a battery on the buyback gap, not just on outage backup.
6. Calendar the plan's end date so you never roll onto a default plan with no buyback.

If you'd rather have someone do steps 2–5 for you, send us the proposal and the plan. Solarfying is an independent solar broker: we don't install systems, homeowners pay us nothing, and we're compensated on the industry side only if you choose to move forward with a deal through us. We'll review the quote free — the price per watt, the buyback assumptions, the system size against your usage, and the financing — and show you whether the savings hold up on the plan you'll actually be on. You can see how the quote review works first.

This article is general consumer education, not legal, tax, or financial advice. Retail plan terms, buyback rates, utility tariffs, and rebate availability change frequently; confirm every figure against the plan's current Electricity Facts Label and Terms of Service, or your utility's published solar tariff, before you rely on it.