Average residential solar project $9,000 more without tax credit, said EnergySage

Reaching an investment breakeven point will take 43% longer if the Senate Finance Committee’s proposal to gut rooftop solar tax credits goes through, said the company.

June 20, 2025 Ryan Kennedy

Image: Jan Van Bizar, Pexels

One of the major motivations for installing rooftop residential solar is saving on electricity bills.

Residential solar systems offset electricity needs for 25 years or more, but the payback period, or amount of years to breakeven on your investment is far shorter than that.

Currently, payback periods range from about 4 years (in places like Illinois and Washington D.C.) to about 14 years (Tennessee and Washington), said solar marketplace operator EnergySage.

For many years, the federal government has offered a tax credit that covers 30% of a residential solar installation’s cost. This tax credit was designed to remain available into the mid 2030s, but the Senate’s latest budget proposal cuts the credit within 180 days of enactment.

This hurts the return-on-investment for residential solar. EnergySage said installing solar now, before the credit is gone, will save an average of about $9,000 on installed system costs. Without the tax credit, the average payback period will be about 2 to 8 years longer, or about 43% longer across the United States, said EnergySage.

“The current version of the bill being debated in the Senate is poised to eliminate the residential solar tax credit nearly a decade ahead of schedule, and with virtually no phase-down period and a cutoff date of Dec. 31, 2025,” said Casey McDevitt, contributing writer, EnergySage.

Here’s how EnergySage projects the payback period will change in your state without the solar Investment Tax Credit:

State	Payback period with ITC (years)	Payback Period without ITC (years)	Difference (years)
Arkansas	10.9	15.5	4.7
Arizona	11.0	15.7	4.7
California	5.1	7.3	2.2
Colorado	11.3	16.1	4.8
Connecticut	6.1	8.8	2.6
Washington D.C.	3.9	5.6	1.7
Delaware	8.5	12.2	3.6
Florida	10.9	15.5	4.7
Georgia	12.3	17.6	5.3
Iowa	13.3	18.9	5.7
Idaho	13.9	19.8	5.9
Illinois	4.1	5.8	1.7
Indiana	13.3	18.9	5.7
Kansas	12.5	17.8	5.4
Kentucky	12.7	18.2	5.4
Louisiana	13.6	19.4	5.8
Maryland	8.1	11.5	3.5
Maine	12.1	17.3	5.2
Michigan	12.5	17.9	5.4
Minnesota	10.7	15.3	4.6
Missouri	11.8	16.9	5.1
North Carolina	10.3	14.6	4.4
New Hampshire	8.0	11.4	3.4
New Jersey	6.2	8.8	2.6
New Mexico	10.2	14.6	4.4
Nevada	6.3	9.0	2.7
New York	8.1	11.6	3.5
Ohio	8.0	11.4	3.4
Oklahoma	10.0	14.2	4.3
Oregon	9.4	13.4	4.0
Pennsylvania	7.1	10.1	3.0
Rhode Island	6.8	9.7	2.9
South Carolina	8.8	12.6	3.8
Tennessee	14.5	20.8	6.2
Texas	6.2	8.9	2.7
Utah	19.7	28.1	8.4
Virginia	8.9	12.7	3.8
Vermont	10.5	15.1	4.5
Washington	14.1	20.2	6.1
Wisconsin	10.2	14.6	4.4
West Virginia	10.5	15.0	4.5

With solar tax credits potentially set to expire at the end of this year, now is a great time to begin your solar journey. If you want to make sure you’re finding a trusted, reliable solar installer near you that offers competitive pricing, check out EnergySage, a free service that makes it easy for you to go solar. They have hundreds of pre-vetted solar installers competing for your business, ensuring you get high-quality solutions and save 20 to 30% compared to going it alone. Your personalized solar quotes are easy to compare online and you’ll get access to unbiased Energy Advisors to help you every step of the way. Get started here.

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