If you’re staring down your utility bill and wondering whether the solar panels Utah homeowners keep talking about pencil out this year, you’re asking a great question at an interesting moment.
The rules have changed. The 30 percent federal tax credit that made solar power more affordable for the past decade is gone for homeowners who buy their systems outright, and Utah’s own state credit disappeared for residential solar a couple years before that.
Short version: solar can still be worth it in Utah in 2026. The path to savings just looks different than it did in 2024.
What Changed: The Federal and State Tax Credit Reality
The Residential Clean Energy Credit, the 30 percent federal credit under Section 25D, ended for homeowner-owned systems placed in service after December 31, 2025, thanks to the One Big Beautiful Bill Act signed into law in July 2025. If you buy your system with cash or a loan in 2026, that federal credit isn’t available anymore.
Utah’s Renewable Energy Systems Tax Credit followed a similar path. Residential solar PV systems installed in 2024 or later no longer qualify for the state credit at all, and what remains of the broader program sunsets for good after January 1, 2028.
This means the return on your investment now comes almost entirely from what you save on your utility bill every month for the next 25-plus years, not from a one-time tax break. For a lot of Utah households, there’s still a strong case for switching to solar.
What Solar Costs in Utah Right Now
Pricing has come down a long way from where it sat a decade ago, though it’s not quite as cheap as some national headlines suggest. As of 2026, the average cost per watt in Utah runs around $3.02, with a typical installation landing somewhere between $9,355 and $30,200 depending on system size.
Your actual number depends on:
- Roof size, shape, and shading
- Whether you’re adding battery storage
- Your household’s annual energy use
- Whether ground mount, carport, or patio cover makes more sense for your property
Plenty of Utah properties, especially rural and agricultural ones, don’t have ideal roof exposure, but installing solar carports and canopies can help.
How Rocky Mountain Power Actually Credits Your Solar
Per Rocky Mountain Power’s Schedule 137 tariff, effective March 2026, excess energy you send to the grid earns a credit of 4.855 cents per kWh from June through September, and 4.033 cents per kWh from October through May. Credits carry over month to month, but anything leftover expires at the end of the annualized billing period.
Practically, that means the value in your system comes from using your own solar power as you generate or store it, rather than exporting everything and hoping the credit evens out.
This is why battery storage is a common add-on for our Utah solar customers.
Electricity Rates: The Moving Target Worth Watching
Utah still has some of the lowest electricity rates in the country, but that’s held true so far because state leaders and the public have pushed back against Rocky Mountain Power’s rate hike requests. Rocky Mountain Power pushed for a 30 percent increase back in 2024, which drew sharp criticism from Governor Spencer Cox and state lawmakers and got scaled back to an 18 percent request. The Public Service Commission ultimately approved just 4.7 percent in 2025, roughly a quarter of that reduced number.
More recently, a proposed settlement would add a modest 4.2 percent increase to general rates while simultaneously lowering energy charges by 10.6 percent, netting out to roughly an $11 monthly decrease for a typical customer starting in July 2026, with rate stability promised through 2028.
The takeaway is that utility pricing in Utah has been unpredictable due to wildfire liability costs, coal plant economics, data centers, and grid investment. A solar system locks in a big chunk of your energy cost at today’s number, regardless of which way the next rate case swings.
The Grid Is Becoming a Bigger Factor
There’s a piece of this conversation that goes beyond tax credits and rate cases: the physical grid carrying your electricity is under a lot of strain.
Nationally, the U.S. Department of Energy has found that roughly 70 percent of the country’s transmission lines and large power transformers are more than 25 years old, pushing right up against the equipment’s intended lifespan, and that also applies to Utah’s grid. Poles, substations, and transformers built for a much smaller, less electrified population are now carrying air conditioning through summer heatwaves, EV charging, and a wave of new data centers all at once. The Department of Energy projects data centers could climb from roughly 4 percent of U.S. electricity demand today to as much as 12 percent by 2028, and Utah is actively courting that growth, which adds pressure to the shared grid.
Utah lawmakers saw this coming. Senate Bill 132 now requires very large power users, like data centers, to cover their own infrastructure costs or arrange separate power supply, rather than passing those costs automatically to residential customers the way some other states have. While it is a potential safeguard, it still doesn’t address the underlying strain on a grid that’s aging and expanding at the same time.
Weather adds another layer to this situation. Rocky Mountain Power has conducted deliberate, planned power shutoffs in Utah multiple times this year, most recently across a dozen central and southern Utah communities in June 2026, cutting power to thousands of customers as a precaution against wildfire ignition during extreme wind and heat. These Public Safety Power Shutoffs are becoming a regular part of Utah summers, alongside outages caused by windstorms and heatwaves.
None of this means the lights are about to go out across the state. However, it does mean a home battery paired with solar carries value that goes beyond the monthly bill: backup for a struggling grid that’s handling more power than it was built for.
What’s Left for Utah Homeowners
The tax-credit era is over for residential solar in Utah.
There’s no state income tax credit left. Utah’s Renewable Energy Systems Tax Credit stopped covering residential solar PV installed in 2024 or later. There’s no sales tax exemption for a typical home either. That exemption exists in Utah law, but it’s written for large-scale production facilities of two megawatts or greater, not residential homes. And unlike some states, Utah doesn’t offer a property tax exemption for the value solar adds to your home.
There are still some options available to Utah homeowners:
- Rocky Mountain Power’s Wattsmart Battery Program: a $1,000 upfront enrollment incentive for battery systems under 10 kW, or up to $2,000 for larger systems, in exchange for letting RMP tap your battery during grid stress.
- Utah’s HOA protections: homeowners associations can no longer ban rooftop solar outright, though they can still regulate placement and appearance.
Neither of those replace the old 30 percent tax credits. Now, the case for solar in Utah rests on the fundamentals: your utility bill, your usage, and how long you plan to stay in the home.
Commercial, nonprofit, agricultural, and municipal properties still have other paths worth exploring, including a 30 to 40% tax credit until 2027, USDA REAP grants and Rocky Mountain Power’s Wattsmart Business program, both of which our team regularly helps clients navigate as part of the permitting and design process.
So, Is It Worth It?
For a lot of Utah homeowners, solar is worth it, particularly if they plan to stay in their home for a while, their roof gets decent sun exposure, and they’re comfortable financing a purchase rather than leasing.
But for others, especially those with modest usage, the math might not add up.
This is where two decades of doing this across Utah, Wyoming, and Idaho comes in handy. Our crew of NABCEP-certified solar craftspeople has designed and installed grid-tied, off-grid, and battery-backed systems on more properties, and stranger roofs, than most installers ever see.
We’re a Certified B Corporation because we think the industry should be held to a higher standard, and for every project we complete, we donate to the Honnold Foundation solar grants program.
If you’re ready to see what solar panels would look like on your Utah home, let’s take a look together.