Solar in Tennessee: is it worth it in 2026?
Tennessee is one of the hardest states to make solar pay for itself. Three things decide that: electricity here is among the cheapest in the country (41st most expensive of 51), its sun ranks 32nd, and there's no statewide rule for paying you for exported power. Of the 51 states and DC, Tennessee has the 50th-fastest payback for a typical home.
The average home here pays about $156 a month for 1,180 kWh. A 9.5 kW system sized for that home would knock about $924 off the first year's bills, 49% of the total.
Checked November 12, 2026
What makes solar pay off in Tennessee
- Size the system to what you use during the day, not to your whole year: extra power sent to the grid earns little. A battery, or running the dishwasher, laundry and EV charging while the sun is up, raises the value of every panel.
- Cheap power stretches payback. At 13.2¢ per kWh, the price you pay matters more than anything. At $3.34 per watt, the high end of what companies quote, payback for a typical system here goes past 25 years.
Payback by system size
An average Tennessee home uses about 14,160 kWh a year. Here's how systems sized to cover part or all of that work out, bought with cash at $2.57 per watt:
| Covers | Size | Price | Makes a year | Payback | 25-year savings |
|---|---|---|---|---|---|
| 52% | 5.5 kW | $14,135 | 7,359 kWh | 25 years | $352 |
| 76% | 8 kW | $20,560 | 10,704 kWh | 24 years | $1,705 |
| 99% | 10.5 kW | $26,985 | 14,049 kWh | 24 years | $3,058 |
| 123% | 13 kW | $33,410 | 17,394 kWh | 25 years | $1,532 |
The 8 kW system pays back fastest, but the 10.5 kW system saves the most over 25 years, though only if the extra power is used at home. Assumes exported power earns about 25% of the retail rate, prices rise 2.5% a year and one inverter replacement.
How Tennessee credits power you send to the grid
No statewide rule
Little or no statewide net metering. Ask your utility what it pays for exported power.
We haven't found a single published export rate for Tennessee, so the calculators assume about 25% of the retail rate. Ask your utility for its rate and enter it.
Before you sign in Tennessee
Check the license. Look the company up with the Tennessee Board for Licensing Contractors, by its legal name or license number, and ask for the electrician's license number too.
Tennessee has no solar-specific sales law that we know of, so its general consumer protection law applies.
In every state, the FTC Cooling-Off Rule lets you cancel a contract signed at your home until midnight of the third business day.
How to choose a solar company · Contract checklist · Before you sign
Tennessee compared with its neighbors
| State | Electricity | kWh per kW | Typical payback | Exported power |
|---|---|---|---|---|
| Tennessee | 13.2¢ | 1,338 | 24 years | No statewide rule |
| Kentucky | 13.1¢ | 1,343 | 20 years | Reduced credit (net billing) |
| Virginia | 15.3¢ | 1,427 | 11 years | Full credit (net metering) |
| North Carolina | 14.0¢ | 1,416 | 15 years | Monthly netting |
| Georgia | 14.7¢ | 1,420 | 17 years | Reduced credit (net billing) |
| Alabama | 16.1¢ | 1,367 | 20 years | No statewide rule |
| Mississippi | 14.0¢ | 1,414 | 19 years | Reduced credit (net billing) |
| Arkansas | 12.9¢ | 1,373 | 22 years | Reduced credit (net billing) |
| Missouri | 13.3¢ | 1,433 | 15 years | Monthly netting |
Questions about solar in Tennessee
How long does solar take to pay for itself in Tennessee?
About 24 years for a typical 9.5 kW system bought with cash at the 2026 median price of $2.57 per watt, with no federal tax credit and one inverter replacement. A bigger or smaller system, a different price, or your own usage will change that; the table above shows other sizes.
Does Tennessee have net metering?
No statewide rule. Little or no statewide net metering. Ask your utility what it pays for exported power.
Is there a solar tax credit in Tennessee in 2026?
Not from the federal government for buyers: the 30% homeowner credit ended for systems installed after December 31, 2025. For a typical 9.5 kW system in Tennessee, that credit was worth about $7,325 and brought payback down to 18 years, instead of 24 years now. Leasing companies can still claim a business credit, so ask for a lease or PPA price too. Your state energy office lists any state rebates.
Is a solar battery worth it in Tennessee?
On bill savings alone, not quite: a 13.5 kWh battery at about $15,650 would move about 3,548 kWh of solar power a year from the grid to your evenings in a typical Tennessee home, adding about $5,244 of savings over 15 years. That doesn't cover its price, so the system's payback goes from 24 years to over 25 years; the rest is paying for backup during outages. Time-of-use rates, battery rebates and utility payments for sharing your battery can tip it; try your numbers in the payback calculator.
Is plug-in solar legal in Tennessee?
There's no plug-in solar law yet in Tennessee, so your utility may treat a kit like any rooftop system.
How do I check a solar company's license in Tennessee?
Look the company up with the Tennessee Board for Licensing Contractors (tn.gov/commerce/regboards/contractors.html) by its legal name or license number, and ask for the electrician's license too.
More guides: What changed for solar in 2026 · Lease or buy? · Plug-in solar · Is my solar system working?
Sources: U.S. Energy Information Administration (EIA), final 2025 data: Annual State Historical Spreadsheets (Form EIA-861, released October 7, 2026) and Electric Power Annual (October 21, 2026); NREL PVWatts (National Solar Radiation Database), statewide averages; SolarReviews: Net metering in 2026; EnergySage: median quoted price, first half of 2026.