Texas is one of the sunniest states in America. It’s also one of the worst states for solar owners, by design.
Unlike 38 other states, Texas has no net metering law. That means providers aren’t required to pay you retail rates for the excess power your panels generate. Many pay wholesale rates—3-5 cents per kWh for electricity you’d pay 12-15 cents to buy back. Some pay nothing at all.
This wasn’t an accident. When Texas deregulated electricity in 2002, lawmakers deliberately excluded mandatory solar buyback. The result is a patchwork of voluntary programs where some providers offer fair compensation and others extract maximum value from uninformed solar owners.
Here’s how to find the programs that actually pay you fairly—and avoid the ones that treat your solar investment as a donation.
The Net Metering Scam You Need to Understand
Most states require utilities to credit solar customers at retail rates—what you’d pay for electricity. Your meter essentially runs backwards when you export power.
Texas chose a different path. When the state deregulated electricity, lawmakers separated power generation from retail sales. The transmission companies (TDUs like Oncor and CenterPoint) don’t sell power—they just move it. And retail electric providers (REPs) aren’t required to buy your solar at any particular rate.
What this means for you: No mandatory net metering. Each retail provider sets their own buyback terms, if they offer any at all. Many offer 2-5 cents per kWh for power they’ll turn around and sell to your neighbor at 12-15 cents.
The silver lining? Competition among providers means some actually offer fair solar programs to attract customers. But you have to actively find them—they won’t find you.
How Texas Solar Buyback Plans Work
Without net metering, Texas uses a “buyback” model. Here’s the basic structure:
1. Your panels generate power during the day
When the sun is shining, your system produces electricity. Your home uses what it needs first.
2. Excess power flows to the grid
When you generate more than you’re using—typically midday when solar production peaks and nobody’s home—that power goes out through your meter to the grid.
3. Your provider credits your account
Your REP tracks how much you export and credits your account at whatever rate your plan specifies. This is where plans differ dramatically.
4. You draw from the grid at night
When your panels aren’t producing, you pull power from the grid like any other customer, at your normal electricity rate.
5. Monthly settlement
At the end of each billing cycle, your credits offset your charges. If you exported more than you imported, some plans bank the credit; others pay it out; others just zero out your bill and pocket the difference.
1:1 Credits vs. Wholesale Rates: The Big Difference
Not all solar buyback is created equal. The compensation structure determines whether your program is actually valuable.
1:1 (Full Retail) Credits
The gold standard. For every kilowatt-hour you export, you get credit at the same rate you pay to import power.
Example: You pay 12 cents/kWh for electricity. You export 500 kWh. You get $60 in credits—exactly what you’d pay for 500 kWh of consumption.
This is as close to true net metering as Texas gets. A few providers offer it, and it makes solar economics much simpler.
Wholesale Rate Buyback
More common. Your provider pays you what power is worth on the wholesale market—typically 3-5 cents/kWh, sometimes less.
Example: You export 500 kWh at a 4-cent buyback rate. You get $20 in credits. But buying that same 500 kWh back costs you $60 at retail rates.
The math can still work, but you need to offset most of your usage directly rather than counting on exports to cover your bill.
Tiered or Capped Programs
Some plans offer 1:1 credits up to a certain amount, then drop to wholesale rates. Others cap total credits per month or per year. Read the fine print.
Which Providers Offer the Best Solar Buyback?
Several Texas REPs have built their business around solar customers. Here are the standouts:
Rhythm Energy
Rhythm launched specifically to serve tech-savvy customers who want transparency—and their solar program reflects that.
What they offer: Competitive buyback rates with clear, simple terms. No decoder ring required to understand what you’re getting.
Why it works: Rhythm was founded by people who understood the industry’s tricks. Their solar program is designed to actually benefit homeowners, not just check a regulatory box.
The catch: Rhythm is only about 5 years old. If startup uncertainty bothers you, keep reading.
Chariot Energy
Chariot built their entire company around solar from day one. They’re not a traditional provider that added a solar plan—solar is their core business.
What they offer: Solar buyback rates that often beat larger competitors. They also offer community solar programs for people who can’t install their own panels.
Why it works: When solar is your whole identity, you have to get the buyback program right. Chariot takes it seriously.
The catch: Smaller company, less name recognition. Also, they don’t have plans on all comparison sites, so you may need to go directly to their website.
Green Mountain Energy
Green Mountain has been selling renewable electricity since 1997. While they’re better known for wind and conventional green plans, they do serve solar customers.
What they offer: Solar programs that fit into their broader renewable energy mission.
Why it works: 27 years of experience with renewable energy. If longevity and track record matter to you, Green Mountain has receipts.
The catch: Green Mountain generally costs more than budget providers. If your primary goal is maximizing solar ROI, cheaper providers with good buyback rates might serve you better.
Other Options to Consider
TXU Energy, Reliant, and other major providers also offer solar buyback programs. Their rates tend to be less competitive than the solar-focused providers, but they offer the stability of large, established companies.
Always compare multiple offers. Rates change, and the best deal today might not be the best deal in six months.
Requirements for Solar Buyback in Texas
Before you can start earning credits, you’ll need to meet some requirements:
Smart Meter
You need a smart meter that can measure power flowing both directions. If you still have an old analog meter, your TDU will need to install a smart meter before you can participate in a buyback program. Most Texas homes already have them.
Interconnection Agreement
Your solar installation must be properly connected to the grid with approval from your TDU. This involves:
- Technical review: Your TDU verifies your system meets safety and technical standards
- Inspection: A physical inspection of your installation
- Agreement: You sign an interconnection agreement spelling out the terms
Your solar installer should handle most of this paperwork. It typically takes 2-4 weeks after installation to get approval.
System Size Limits
TDUs have limits on system size for residential interconnection—typically around 25-50 kW. Unless you’re building a compound, this won’t affect most homeowners.
Insurance
Some TDUs require proof of homeowner’s insurance covering your solar installation. Check with your TDU for specific requirements.
How to Calculate If Solar Buyback Is Worth It
The math depends on your specific situation. Here’s how to think about it:
Step 1: Know Your Production and Consumption Patterns
Get data from your solar monitoring system. When are you producing power? When are you using it? How much are you exporting?
Most Texas homes with solar export heavily during midday and import in the evening. If you work from home or have daytime loads (pool pumps, EVs charging during the day), your export volume will be lower.
Step 2: Calculate Export Value Under Different Plans
Take your monthly export volume and multiply by different buyback rates.
Example: You export 400 kWh/month on average.
- 1:1 at 12 cents: $48/month in credits
- Wholesale at 4 cents: $16/month in credits
- Wholesale at 2.5 cents: $10/month in credits
The difference between the best and worst buyback can be $400+ per year.
Step 3: Factor In the Import Rate
A plan with great buyback but high import rates might not be the best overall deal. Calculate your total cost: imports minus exports.
Example: You use 1,000 kWh total (600 kWh imported, 400 kWh exported).
- Plan A: 14 cents import, 1:1 buyback: $84 import - $56 credit = $28 net
- Plan B: 10 cents import, 3-cent buyback: $60 import - $12 credit = $48 net
Plan A has a higher rate but better buyback, and it wins in this scenario.
Step 4: Consider Time-of-Use Rates
Some plans charge different rates at different times. Solar produces power during the day; you use power in the evening. If evening rates are high and daytime rates are low, your solar might be less valuable.
Run the numbers with your actual usage patterns.
Step 5: Read the Full Terms
Check for:
- Monthly caps on credits: Some plans limit how much you can earn
- Annual true-up: Does unused credit roll over indefinitely or reset?
- Minimum bills: Some plans have minimum charges even if your net usage is zero
- Contract length: Are you locked in for 12 months? 36 months?
Common Solar Buyback Mistakes to Avoid
Mistake 1: Choosing Based on Buyback Rate Alone
The best buyback rate doesn’t help if the base electricity rate is terrible. Calculate your total cost, not just the credits.
Mistake 2: Ignoring Caps and Limits
A plan advertising “1:1 buyback” might cap credits at 100 kWh or reset your balance annually. Read the terms.
Mistake 3: Oversizing Your System Without Planning
If you export far more than you import, you might hit credit limits or end up with credits that never get used. Size your system to match your consumption patterns.
Mistake 4: Forgetting About Rate Changes
Fixed-rate plans lock in your import rate, but buyback rates might be tied to wholesale markets and fluctuate. Know what’s fixed and what isn’t.
Mistake 5: Assuming Your Current Provider Has Good Buyback
Many Texans stay with whoever they signed up with years ago. If you install solar, shop for a new plan specifically designed for solar customers. Your current provider’s buyback might be terrible.
The Bottom Line
Texas doesn’t have net metering, but solar buyback plans can still make rooftop solar worthwhile. The key is finding the right plan for your situation.
If you export a lot: Prioritize 1:1 buyback rates. Providers like Rhythm and Chariot specialize in serving solar customers.
If you mostly self-consume: The buyback rate matters less. Focus on a low import rate and simple billing.
If you’re still deciding on solar: Run the numbers with realistic buyback assumptions (not best-case scenarios). Solar can still pencil out in Texas, but don’t count on generous compensation for exports.
The Texas electricity market rewards customers who do their homework. You already made the investment in solar panels. Spend a few hours finding the right buyback plan, and you’ll maximize that investment for years to come.
Ready to compare solar buyback options? Check out our profiles of Rhythm Energy, Chariot Energy, and Green Mountain Energy to see which provider fits your needs.