How Much Is Solar in Houston, TX? $2.25/W, 11.2–22.0-Yr Payback

Why this number

Houston is the largest metro in Texas and the weakest of the three Texas locations we have data for: 1,389 kWh per kW, against 1,455 in Dallas and 1,784 in El Paso. El Paso produces 28% more from the same 8 kW array, in the same state, under the same retail electricity market — 8.8 years to payback there against 11.2 years here.

Humidity, haze and afternoon convection

The Gulf is 50 miles away and it shapes everything. Moist maritime air means morning low cloud, summer haze that scatters direct beam irradiance, and near-daily afternoon convective towers from June through September. None of it is dramatic on any single day; across a year it is worth about 5% against Dallas and 22% against El Paso.

Houston’s compensation is heat-driven demand. Air conditioning load peaks in the afternoon, roughly in phase with generation, so self-consumption here is naturally higher than in a milder climate — which matters more than usual in a state with no guaranteed export credit.

No single utility rate: Houston is deregulated

Houston sits in ERCOT’s retail-choice market, so there is no one utility whose price we can quote the way we do for regulated cities. CenterPoint Energy owns and maintains the wires and charges a delivery fee that appears on every bill, but the energy itself — the cents per kWh you actually pay, and whether your solar exports earn anything — is set by the Retail Electric Provider (REP) contract you choose. Texas has no statewide solar-export mandate: buyback exists only as specific REP plans, and terms differ even between plans from the same provider.

Practical consequences for the numbers on this page: the payback above uses the Texas average residential rate, because that is the only honest single figure available. Before trusting any payback estimate, rerun the calculator with the rate from your own REP contract, and if you are going solar, compare REP buyback plans on two numbers — what they charge you per imported kWh and what they credit per exported kWh — not on the headline rate alone. Solar sales in these metros also lean heavily on third-party ownership — a lease or PPA layered on top of the REP choice — so be clear which of the two contracts you are actually signing.

Start with the honest number: Houston’s PVGIS-modeled yield of 1,389 kWh per kW per year is the weakest of any Texas city we track. Gulf humidity, morning cloud, and summer convection take a steady toll, and the gaps run in one direction — Dallas models about 5% higher at 1,455, Corpus Christi about 6.5% higher at 1,479, Lubbock 21% higher at 1,682, and El Paso, at 1,784, out-produces the same panel here by 28% without leaving the state.

Now the more useful number. At the 16.44¢/kWh statewide average residential rate our headline model uses, the entire Dallas–Houston sunshine gap — 66 kWh per kW per year — is worth roughly $11 per kW annually. Meanwhile, our export-rules data models Texas buyback at a conservative 3.0¢/kWh because there is no statewide mandate: what an exported kilowatt-hour earns is set entirely by your retail contract, and terms differ even between plans from the same provider. The spread between a plan crediting exports near the retail rate and one paying the floor is over 13¢ on every exported kilowatt-hour. Houston’s sunshine deficit is real; a bad contract is bigger. Choosing the wrong buyback plan can cost a Houston household more than moving the whole roof to Dallas would gain it.

That means the work in Houston is paperwork, not panel-tilting. CenterPoint owns the wires, but the economics live in the REP contract, so compare plans on both sides of the meter at once: the import rate you pay, the export credit you receive, and any monthly fees — a headline buyback rate frequently rides on an inflated consumption rate. Run the math on your own numbers: each kW installed should produce about 1,389 kWh a year here, and how that splits between self-use and export depends on when you are home. Contracts run one to three years; plan to re-shop repeatedly over a 25-year system life.

On installed cost, Texas is cheap on paper — $2.25 per watt in EnergySage’s August 2026 quote data — but LBNL’s realized prices for Texas average $4.04/W across 2,670 systems, an 1.8x gap that makes multiple quotes the single highest-value hour of this whole project. Finally, the 2026 federal picture: the residential credit for a cash or loan purchase is $0. The 30% credit now flows only through third-party ownership — a lease or PPA claiming it under §48E — so any Houston pitch quoting “30% back” on a system you would own is out of date, and how much of the leasing company’s credit reaches you depends entirely on the contract terms.

Texas is not one solar market

Across the 7 Texas cities with their own modeled figures, production spans 28% — Houston at 1,389 kWh per kW to El Paso at 1,784. Every column except production is identical down this table: same 15.9¢/kWh retail rate, same export regime, same $2.25/W installed cost. The payback differences are caused by weather and nothing else.

Against the state figure, Houston runs 4.5% below Texas’s 1,455 kWh per kW — a payback 0.5 years longer than the statewide 10.7-year estimate on the same hardware at the same price.

An 8 kW system in Houston, priced out

Only the first two rows differ. Everything financial — rate, tariff, price per watt — is inherited from Texas without change, which is the point: a city page that quietly used a different electricity rate from its state page would be guessing, not measuring.

Doing nothing is not free either. Twenty-five years of the electricity an 8 kW Houston array would produce, with rates rising at 2.5% a year, comes to roughly $54,243.

Solar aside, the EV vs. gas cost calculator runs Houston’s 15.9¢/kWh rate against what a gas car costs to fill instead.

Run it with your own bill