Is solar worth it in 2026 without the federal tax credit?

It depends entirely on your installer's pricing. At BYOP Electric's rate of $1.60/W, a 10kW system costs $16,000 and has a payback period of approximately 10 years — still a solid investment over the 25-year panel warranty. At the industry average of $2.50-3.50/W ($25,000-$35,000), payback stretches to 15-22 years, making the financial case much weaker.

When did the federal solar tax credit expire?

The federal residential solar Investment Tax Credit (ITC) expired on December 31, 2025. It ended entirely with no phase-down period. There is currently no federal tax credit available for residential solar installations. The EV charger tax credit (30C) is a separate program and remains active through 2032.

Are there any solar incentives left in Utah in 2026?

The main remaining incentive is Rocky Mountain Power's Wattsmart Battery program, which pays $2,000 per qualifying battery installation. There is no state solar tax credit in Utah. The federal EV charger credit (30C) covers up to $1,000 for EV charger installations but does not apply to solar panels.

Could the federal solar tax credit come back?

It is possible but uncertain. Solar tax credits have been extended and modified multiple times since their original creation. If a new ITC is enacted, homeowners who already have solar would not benefit retroactively, but those considering solar could benefit from waiting. However, waiting carries its own risk — you lose months or years of energy savings while hoping for a policy change that may not come.

What is the payback period for solar without any incentives?

At BYOP Electric's $1.60/W rate, approximately 9-11 years for a typical 10kW system based on Utah electricity rates. At the industry average of $3.00/W, approximately 17-20 years. The payback period is primarily determined by three factors: installation cost, system production (based on roof orientation and shading), and local electricity rates.

Is Solar Worth It Without the Federal Tax Credit? (2026 Utah Guide)

The federal residential solar tax credit (ITC) expired on December 31, 2025. No phase-down. No extension. Just gone.

So the question I am getting from every homeowner considering solar in 2026 is straightforward: is it still worth it?

The honest answer is: it depends almost entirely on what your installer charges. And that is the part most solar companies do not want you to think about too carefully.

What the Tax Credit Used to Do

The ITC was a dollar-for-dollar federal tax credit worth 30% of your total solar installation cost. If you installed a $30,000 system, you got $9,000 back on your federal taxes. That credit made even overpriced solar installations pencil out financially.

Here is what many people do not realize: the tax credit functionally subsidized the solar industry's inflated pricing. Companies could charge $3.00/W, point to the tax credit, and say "but after the credit, you're only paying $2.10/W." The homeowner felt like they got a deal. The company pocketed the margin. Everyone was happy -- except the taxpayers funding the credit.

Now that the credit is gone, the full price is the real price. And that is where the middleman math breaks down.

The Real Math: Two Scenarios

Let me show you the math on a 10kW solar system -- a common size for Utah homes -- at two different price points.

Scenario 1: BYOP Electric at $1.60/W

System cost	$16,000
Federal tax credit	$0 (expired)
Net cost	$16,000
Annual production	~14,500 kWh
Annual savings (at $0.12/kWh avg)	~$1,600
Simple payback	~10 years
25-year savings (after payback)	~$24,000+

At $1.60/W, even without the tax credit, you break even in about 10 years and then enjoy 15+ years of essentially free electricity. Factor in rising utility rates (Rocky Mountain Power has raised rates multiple times in the past decade), and the payback could be closer to 8 years.

Scenario 2: Typical Solar Company at $3.00/W

System cost	$30,000
Federal tax credit	$0 (expired)
Net cost	$30,000
Annual production	~14,500 kWh (same panels, same sun)
Annual savings	~$1,600 (same savings, same utility)
Simple payback	~19 years
25-year savings (after payback)	~$9,600

At $3.00/W, you are looking at nearly 19 years to break even. Your panels have a 25-year warranty, so you get about 6 years of actual savings. The total lifetime savings ($9,600) is less than what you would earn putting $30,000 in a savings account.

Same panels. Same inverters. Same sunlight. Same utility rate. The only difference is what the installer charges. That is the entire story.

Why Solar Companies Charge So Much

I have written about this in my detailed solar cost breakdown, but it bears repeating: the gap between $1.60/W and $3.00/W is not better hardware. It is overhead.

Sales commissions: $3,000-$7,000 per deal for the person who knocked on your door
Marketing: TV ads, lead generation, door-to-door teams -- all funded by your quote
Leasing infrastructure: Entire departments managing lease products that benefit the company, not you
Corporate layers: Regional managers, VPs, call centers, office space
Sub-contractor margins: Some companies sub out the installation, adding another profit layer

At BYOP Electric, I eliminated all of this. No sales team. No leases. No corporate overhead. I am the engineer who designs your system, the electrician who installs it, and the person you call with questions. That is how $1.60/W is possible while still running a profitable business.

When Solar Still Makes Sense (Without the Tax Credit)

Solar remains a good investment when these conditions are met:

You can get installed at $2.00/W or less. At this price point, payback periods stay under 12-13 years, leaving meaningful savings over the panel warranty.
You have a south-facing roof with minimal shading. Production is maximized, which means faster payback.
You plan to stay in the home 10+ years. You need to be there long enough to benefit from the payback period.
Your electricity bills are $150+/month. Higher usage means higher savings, which means faster payback.
You value energy independence. Not everything is about ROI -- some homeowners value producing their own power, reducing grid dependence, and having battery backup.
You are adding battery storage. With Utah's unfavorable net billing rates, a battery system maximizes self-consumption and improves overall ROI. Plus the Wattsmart program gives you $2,000 per battery.

When Solar Does NOT Make Sense

I will be direct -- there are situations where I advise against solar, especially without the tax credit:

Your installer quotes $2.50/W or more and you are financing. High installation cost plus interest on a solar loan means your actual cost could be $3.50-4.00/W. Payback may never happen within the warranty period.
Your roof needs replacement in the next 5 years. Do the roof first. Removing and reinstalling panels adds $2,000-$5,000 to your total cost.
Heavy shading or poor roof orientation. If production is significantly below average, the math gets worse fast.
You plan to move within 5 years. Solar adds home value, but studies vary on how much -- and in a post-ITC market, buyers may not place as much premium on an existing solar system.
Your electricity bill is under $80/month. The system size you need is small enough that fixed costs (permits, interconnection) make the per-watt economics less favorable.
Someone is pushing you into a lease or PPA. Walk away. Leases transfer the financial benefit from you to the leasing company. Without the ITC to sweeten the deal, leases are an even worse proposition for homeowners.

The Battery Value Proposition

Batteries deserve separate consideration because they change the math in important ways:

Backup value: A battery keeps your lights, refrigerator, and critical systems running during power outages. This has real value that is hard to put in an ROI spreadsheet -- especially in Utah where winter storms can knock out power for hours or days.

Self-consumption value: Utah's net billing rate credits exported solar at roughly half the retail rate. A battery lets you store excess daytime production and use it in the evening, effectively doubling the value of that energy compared to exporting it.

Wattsmart incentive: Rocky Mountain Power pays $2,000 per qualifying battery through the Wattsmart program. This significantly reduces the net cost of battery storage. An EG4 battery at $5,000 minus $2,000 Wattsmart = $3,000 net for 10+ kWh of storage.

Read my full battery comparison for pricing and recommendations on each of the six brands I install.

What If the Tax Credit Comes Back?

Solar tax credits have been extended and modified multiple times since their creation. It is entirely possible that Congress enacts a new residential solar ITC at some point. If that happens:

It would not apply retroactively. If you already installed solar, you would not get a credit for past installation costs.
Waiting means losing savings. Every month you do not have solar, you are paying full price for electricity. If you wait a year hoping for a credit and it does not come, you have lost $1,500-$2,000 in potential savings.
If it does come back, it is pure upside. If you install solar now at $1.60/W and a new ITC passes later, you already have a system with a great payback period. If a credit applies to batteries you add later, even better.

My advice: do not make a financial decision based on legislation that does not exist. If the math works at today's prices, install today. If a credit comes back, that is bonus money in your pocket on a future battery or expansion.

The Bottom Line

The federal solar tax credit is gone. That changes the math, but it does not kill solar -- it kills overpriced solar.

At $1.60/W, solar still pencils out with approximately a 10-year payback and 15+ years of savings. At $3.00/W, the financial case is weak without the credit propping it up.

The question is not "is solar worth it?" The question is "is solar worth it at the price your installer is quoting?" And the answer depends entirely on how much middleman overhead is baked into that number.

If you want to see what solar costs without the middlemen, call me at (385) 355-1413 or request a free quote. I will give you the real numbers and an honest assessment of whether solar makes sense for your specific home and situation. And if a panel upgrade is needed to support solar, I will tell you that upfront too -- not after you have signed a contract.