Florida solar incentives & net metering (2026)

Florida’s 2026 solar incentive stack is a 6% sales tax exemption on equipment, a 100% property tax exclusion on added home value, and retail-rate net metering through the four major utilities — the federal residential tax credit expired December 31, 2025, leaving the federal benefit at $0 for new 2026 purchases. Both state exemptions apply automatically with no application, no income threshold, and no phase-out, so the savings reduce your cost from day one.

The two automatic tax breaks every Florida solar homeowner gets

Sales tax exemption on solar equipment

Florida permanently exempts solar energy systems from the state’s 6% sales tax. The exemption covers panels, inverters, racking, batteries integrated with solar, and related equipment. You don’t apply for it, there’s no income limit, and the installer collects no sales tax on those line items.

On an 8 kW system priced around $22,400, that 6% exemption saves roughly $1,344 at purchase — a figure that rarely appears in simplified “total savings” breakdowns but reduces your out-of-pocket cost immediately.

Property tax exclusion on added home value

Solar panels raise a home’s appraised value. In most states, that triggers a higher property tax bill each year. Florida removes that disincentive entirely: the added market value a solar installation creates is 100% excluded from your property tax assessment, permanently.

If comparable sales suggest your 8 kW system adds $18,000–$20,000 to your home’s market value, your county assessor doesn’t count any of it. Depending on your local millage rate, that exclusion could be worth $200–$400 per year in avoided property tax (estimate). Over a 20-year system life, that accumulates to $4,000–$8,000 — similar in scale to a modest tax credit, but without any paperwork or income threshold to clear.

Both exemptions are automatic. You file nothing, and neither phases out over time.

What happened to the federal solar tax credit

The residential federal solar tax credit — IRC §25D, commonly called the ITC — expired on December 31, 2025, under the One Big Beautiful Budget Act (OBBBA). For any system purchased in 2026, the federal credit is $0. There is no carryforward provision for new purchases.

This is a significant shift from 2024 and 2025, when a 30% credit accelerated payback math considerably. That number no longer applies to residential purchases. If an installer quotes you a 30% federal credit, ask them to point to the current statute before you sign anything — and verify independently with a tax professional.

One nuance worth understanding: leases and power purchase agreements (PPAs) work differently. In those arrangements the system is owned by a third-party company, which may claim a commercial solar credit under §48E. That can lower your monthly lease rate, but you receive no credit directly on your tax return — the benefit flows through the financing structure. If you’re comparing ownership against a lease or PPA, examine total lifetime cost carefully; you can dig into that analysis at are solar panels worth it?.

Florida net metering: how it works month to month

Florida’s four major investor-owned utilities — Florida Power & Light (FPL), Duke Energy Florida, Tampa Electric (TECO), and Florida Public Utilities — operate under net metering rules set by the Public Service Commission under PSC Rule 25-6.065. When your panels produce more electricity than you’re consuming at a given moment, the excess flows onto the grid and you earn a credit at the full retail rate. When you pull from the grid — overnight, on overcast days, or during high-demand evenings — those credits offset what you owe.

Month to month, the bank works in your favor during high-production months. In April and May, Florida sun is strong and air conditioning demand hasn’t hit its summer peak yet. You accumulate credits quickly. In July and August, AC runs almost continuously — production stays high, but consumption spikes too, and you draw down those credits. Through most of the year, the billing offset is clean and transparent.

The annual true-up: the detail most articles skip

Florida’s net metering has one important caveat that sales materials routinely gloss over.

At the end of each 12-month billing cycle, utilities perform an annual true-up. If you’ve consumed more than you’ve produced over the year — common with right-sized or slightly undersized systems — you owe the difference at retail rates. But if you’ve produced more than you’ve consumed, any remaining net surplus is paid out at the utility’s avoided-cost rate, not at retail.

The avoided-cost rate is roughly what it would have cost the utility to generate or purchase that electricity from other sources — typically around 2–5 cents per kWh in Florida. Compare that to a retail rate that may sit at 12–14 cents per kWh or higher in 2026. A 500 kWh surplus paid at 3¢ earns you $15. At retail, that same 500 kWh would be worth $65 or more. That’s a meaningful difference.

Right-size your system to match annual consumption rather than dramatically overbuilding. Generating far more than you use doesn’t pay back proportionally — the surplus ends up cashing out at a fraction of the retail rate. Before you commit to a system size, the solar savings calculator can help you model different production scenarios against your actual usage.

Which utilities follow PSC net metering rules — and which don’t

The retail-rate monthly net metering described above applies only to customers of Florida’s investor-owned utilities. Municipal utilities and rural electric cooperatives set their own net metering terms, and those vary significantly from one provider to the next. Some municipals offer programs competitive with or even better than IOU terms. Others pay avoided-cost rates from the first kWh exported, or have capacity limits that restrict new enrollments.

If you’re served by JEA in Jacksonville, Orlando Utilities Commission, Lakeland Electric, or any of Florida’s rural co-ops, contact your provider directly before you purchase. PSC oversight does not extend to those entities, and assuming IOU rules apply to your account is a common and costly mistake.

Florida solar incentives summary

Incentive	Type	Value	Who qualifies	Key notes
Federal residential tax credit (§25D)	Federal	$0 in 2026	N/A	Expired December 31, 2025
Sales tax exemption on solar equipment	State	6% of equipment cost	Any Florida buyer	Automatic at purchase; no application
Property tax exclusion on added home value	State	100% of added value	Any Florida property owner	Permanent; applies indefinitely
Retail-rate net metering	Utility	Full retail credit month-to-month	FPL, Duke, TECO, FPU customers	Annual surplus paid at avoided cost (~2–5¢/kWh)
Municipal and co-op net metering	Utility	Varies by provider	Varies	Contact your utility directly for current terms

A worked example: 8 kW system in Orlando

Install an 8 kW system in Orlando, where annual peak sun averages around 5.5 hours per day.

Gross annual production: 8 kW × 5.5 hours × 365 days = 16,060 kWh. That is the raw figure before accounting for real-world system losses. Apply a standard 0.80 system performance ratio — which captures efficiency losses from heat, wiring resistance, inverter conversion, and any shading — and you arrive at approximately 12,850 kWh per year, or roughly 1,070 kWh per month on average. Some installers quote gross figures in proposals; always ask whether a performance ratio has been applied. If it hasn’t, subtract 15–20% from their annual production estimate.

The average Florida household uses around 1,100–1,200 kWh per month. This 8 kW system covers most but not quite all of annual consumption — intentional, to avoid generating a large year-end surplus that would cash out at the avoided-cost rate.

Estimated system cost: $22,400 (approximately $2.80 per watt installed — see solar panel cost in Florida for current regional pricing data).

Automatic savings applied at purchase:

• Sales tax exemption: ~$1,344 saved
• Adjusted net cost: ~$21,056 (estimate)

Annual electricity bill savings at $0.13/kWh: 12,850 kWh × $0.13 = ~$1,671/year (estimate). Rates tend to increase over time, which improves the long-term math.

Simple payback: $21,056 ÷ $1,671 ≈ 12.6 years (estimate). Factor in the property tax exclusion — say $275/year avoided over that same period — and the effective payback shortens further. These are illustrative estimates; your numbers will differ based on system cost, financing, local rates, and usage profile. With no federal credit to front-load the equation, the 2026 payback period is longer than it was in 2024 or 2025.

How to verify current incentives before you commit

Incentive rules change faster than most articles get updated. PSC proceedings can revise net metering terms. Utility programs open and close. Tax law shifts.

Before signing a solar contract:

• Check DSIRE (dsireusa.org) for the current status of Florida-specific programs — the most comprehensive and regularly updated public database of state and utility solar incentives in the country.
• Contact your specific utility and request their current net metering tariff, their avoided-cost rate, and any interconnection queue timelines in your area. Queue delays can affect when you actually start earning credits.
• Speak with a tax professional about the federal credit situation before your system is installed. The expiration is current law as of 2026, but tax policy can move.

Florida’s incentive stack in 2026 is real but thinner than it was two years ago. The two state exemptions are genuine and permanent. Retail-rate net metering through the major IOUs remains a meaningful advantage for most homeowners in those service territories. Accurate numbers — including the avoided-cost caveat at year-end and the absence of a federal credit — are what separate a well-reasoned solar decision from one built on outdated claims.