Is Solar Still Worth It in 2026?

The 30% federal solar tax credit officially expired on December 31, 2025. For a lot of homeowners who were on the fence, that feels like the window just closed. And honestly, we get it. Losing a credit that could knock $6,000 to $9,000 off a system is a big deal.

But here's what we've been telling customers at Current Connected since the One Big Beautiful Bill was signed last July: the tax credit was never the only reason solar made sense. It was a nice bonus. The real math has always been about what you're paying the utility company, and that number is going in one direction.

So let's break it down. Is solar still a smart investment in 2026? What about batteries on their own? And where does the best return actually come from now that the incentive landscape has shifted?

Electricity Prices Are Doing the Heavy Lifting Now

Here's the number that matters more than any tax credit: your electricity rate. And it's climbing.

The national average residential electricity rate hit 18.05 cents per kilowatt-hour in early 2026, which is a 5.4% jump from 2025. That might sound modest, but it's part of a larger pattern. According to the U.S. Energy Information Administration, retail electricity prices have been outpacing inflation since 2022 and are projected to keep rising. In some states, the picture is much worse. New England averages over 30 cents per kWh. The Pacific region averages nearly 25 cents. Hawaii is over 39 cents.

And this isn't just about fuel costs. Utilities across the country are investing billions in grid modernization: replacing aging infrastructure, hardening lines against storms, and building out capacity for surging demand from data centers, EV charging, and electrification. Since January 2025, more than 112 million electric utility customers have faced rate increases or proposals totaling over $92 billion. That cost gets passed directly to your bill.

What does this mean for solar? Every kilowatt-hour your panels produce is a kilowatt-hour you don't buy from a utility whose prices are climbing year after year. Solar essentially locks in your electricity cost at $0 per kWh for the next 25+ years. Even without a tax credit, the spread between "free solar electricity" and "rising grid electricity" gets wider every single year.

Let's put some rough numbers on it. If your household uses 1,000 kWh per month at 18 cents per kWh, you're paying about $2,160 per year. If rates increase at just 4 to 5% annually, you'd pay over $35,000 in electricity over the next 12 years. A solar system that costs $15,000 to $20,000 in equipment (more on how to hit that number below) can offset most or all of that. The payback period is longer without the 30% credit, but it still pencils out for most homeowners, especially in states with above-average rates.

This is the part of the conversation that doesn't get enough attention: batteries can deliver a strong return on investment entirely on their own, even if you never install a single solar panel.

The key is time-of-use (TOU) rate structures. More and more utilities are moving to TOU pricing, where electricity costs significantly more during peak demand hours (typically late afternoon through the evening) and less during off-peak overnight hours. A home battery lets you buy cheap electricity at night, store it, and use it during the expensive window. This is called rate arbitrage, and it's a straightforward way to cut your bill without generating any of your own power.

The economics get even more interesting in states that have restructured their solar compensation. California's NEM 3.0, for example, slashed what utilities pay you for excess solar energy you send back to the grid. Export credits dropped to around 8 cents per kWh, while peak import rates can hit 50 to 74 cents per kWh depending on your utility and plan. That massive spread (sometimes over 60 cents per kWh) makes storing energy instead of exporting it dramatically more valuable. In markets like these, batteries aren't a nice-to-have addition to a solar system. They're the thing that makes the solar system financially viable in the first place.

And here's what a lot of people don't realize: battery storage technology has gotten meaningfully cheaper and better. LiFePO4 (lithium iron phosphate) chemistry, the kind we carry and test at Current Connected, is inherently stable, has an extremely long cycle life, and costs have come down substantially as manufacturing has scaled up worldwide.

If you're on a TOU rate plan and your peak-to-off-peak spread is significant, a battery alone can make financial sense. If you pair it with solar, the economics compound. You're generating free power, storing it, and using it when grid electricity is at its most expensive.

Skip the Markup. Keep the Quality.

Here's something worth talking about now that the tax credit is gone: how you buy your system matters more than ever.

When the 30% credit was in play, a lot of homeowners went with big turnkey solar installers because the credit softened the blow of inflated pricing. Those companies bundle everything together (equipment, labor, design, permits, financing) and charge a premium for the convenience. On a $30,000 to $40,000 installed system, the equipment itself might only account for $12,000 to $18,000. The rest is markup, sales commissions, overhead, and financing fees.

Without the tax credit absorbing a chunk of that inflated price, those markups hit a lot harder.

There's another way to do it. You can purchase your equipment directly from a distributor like Current Connected and then hire a licensed electrician in your area to handle the installation. This approach lets you choose exactly the components you want, at distributor pricing, without paying for a sales team or a national brand's overhead. Your electrician handles the permitting and the install. You get the same result for significantly less money.

This is how a large portion of our customers have always done it, and it's a big reason why the "solar isn't worth it anymore" narrative doesn't hold up. When people say the payback period is too long without the credit, they're usually basing that on turnkey installer quotes in the $3.50 to $4.50 per watt range. When you source your own equipment and work with a local electrician, your all-in cost can drop to $2.00 to $2.75 per watt or less. That changes the payback math dramatically.

And because we test every product we sell in-house, you're not sacrificing quality to save money. You're just cutting out the middleman.