Assumes 3%/yr rate increases, 0.5%/yr panel degradation and no federal tax credit (the 30% §25D credit ended for systems installed after Dec 31, 2025). How we calculate
Data approachEIA rates · NREL sun hours · 2026 federal policy · methodology
In 2026, an 8 kW solar system in Washington costs about $20,800 before financing, and homeowners can no longer claim the 30% federal residential tax credit. That credit (Section 25D) ended for systems installed after December 31, 2025. What remains is a thinner but real incentive stack: Washington’s sales-tax exemption, a property-tax exclusion for solar value, and retail-rate net metering.
Washington is not the strongest solar market in the country. Its average residential electricity rate was 13.11 cents per kWh in 2025, up from 11.90 cents in 2024 (EIA data), and rates vary by utility from roughly 10 to 14 cents. Lower rates mean slower payback, so the numbers below are worth running against your own bill.
This guide uses current 2026 pricing, the incentives that still apply, and a transparent payback model, so you can judge whether solar fits your home.
💰 System Cost
What Solar Panels Cost in Washington in 2026
EnergySage’s Washington marketplace data put the average installed price at about $2.55 to $2.67 per watt through 2026, depending on the month. At $2.60 per watt, common system sizes cost:
System size
Approx. cost at $2.60/W
5 kW
$13,000
8 kW
$20,800
10 kW
$26,000
City-level averages differ somewhat. EnergySage lists around $2.55 per watt in Tacoma, $2.57 in Everett, $2.61 in Kirkland, $2.66 in Redmond and $2.74 in Kenmore, so Puget Sound prices are close to the state figure rather than dramatically higher or lower. Your actual quote depends on roof complexity, equipment, and installer.
Data visualization
An 8 kW Washington system costs about $20,400 to $21,400. Installed cost range by system size at $2.55 and $2.67 per watt, before any incentives. Source: EnergySage Washington marketplace data, 2026.
Chart summary. Each bar is the system size in kW multiplied by the low and high 2026 Washington price per watt reported by EnergySage. The 8 kW system, the typical size used throughout this guide, lands between $20,400 and $21,360, so the $20,800 midpoint at $2.60 per watt is used in the payback model below. These figures are before any state or utility incentives and include no federal credit.
Washington exempts qualifying solar systems up to 100 kW AC from sales tax on both equipment and installation labor, provided the installer is registered with the Department of Labor & Industries and meets other seller requirements. Ask each installer whether their quote already reflects the exemption.
To size a system before you collect quotes, use the solar system size calculator, which works from your annual kWh usage and local production.
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🏛️ Incentives
Solar Incentives in Washington After the Federal Credit Ended
Federal credit: ended for homeowners. The One Big Beautiful Bill Act, signed July 4, 2025, ended the 30% Residential Clean Energy Credit (Section 25D) for expenditures after December 31, 2025. A homeowner who buys a system with cash or a loan in 2026 cannot claim it. Homeowners who completed installation by that date can still claim it on their 2025 return, and unused credit carries forward. Third-party-owned systems (leases and power purchase agreements) can still use the commercial 48E credit under its own deadlines, which providers may or may not pass on in their pricing. The solar tax credit calculator is updated for this change.
State sales-tax exemption. Since July 1, 2019, Washington exempts the purchase and installation of qualified solar systems up to 100 kW AC. You give the seller a Buyer’s Retail Sales Tax Exemption Certificate. Combined state and local sales tax is often well above 8% in Washington cities, so this matters on a $20,000 purchase.
Property tax. Under RCW 84.36.635, the value an active solar system adds is excluded from your property’s assessed value, so installing solar should not raise your property tax bill. Confirm the process with your county assessor.
No state income tax credit. Washington has no state income tax, so there is no state credit equivalent.
Washington’s net metering law (RCW 80.60) applies to systems up to 100 kW and covers investor-owned utilities, municipal utilities, public utility districts and cooperatives. Exported power earns bill credits at the retail rate.
Two limits matter for planning:
Time and capacity cap. Utilities must offer retail-rate net metering until the earlier of June 30, 2029 or the point where net-metered capacity reaches 4% of the utility’s 1996 peak demand. After that, a utility can propose a different rate. The Washington Department of Commerce notes that several utilities have reached the threshold but only a few have moved away from retail-rate net metering. Washington State University’s Energy Program tracks each utility’s status.
Annual credit expiry. Credits roll over month to month, then expire once a year. Published sources give different reset dates (March 31 or April 30), so check your utility’s tariff. Size the system to offset about 100% of your annual use, not to build a surplus that expires.
If your utility has not reached its cap and your system is interconnected before the cutoff, you take service under the current rules. Ask your utility how long those terms apply to you before you sign a contract.
📈 Payback Period
Solar Payback Period and Long-Term Savings in Washington
Western Washington systems produce roughly 1,100 kWh per kW per year, so an 8 kW system generates about 8,800 kWh in its first year. Production declines about 0.5% a year with panel degradation.
The model below uses an $20,800 system cost, no federal credit, and full retail-rate offset under net metering. It compares three rate scenarios:
Data visualization
An 8 kW Washington system breaks even in about 15 to 24 years. Cumulative net cash flow on a $20,800 system with no federal credit, 1,100 kWh per kW per year and 0.5 percent annual degradation. Rates are held flat except the +3 percent per year scenario. Source: EIA 2025 Washington average rate, EnergySage 2026 pricing, NREL PVWatts-based yield. Model estimate.
Chart summary. The chart shows cumulative net cash flow, meaning savings minus the $20,800 upfront cost, for an 8 kW system. At the 2025 state average of 13.1 cents per kWh with flat rates, the system breaks even in about 18.8 years and ends year 25 about $6,400 ahead. If rates rise 3% a year, breakeven drops to about 15.1 years and year-25 net savings rise to about $18,500. At 10.4 cents with flat rates, a figure typical of low-rate utilities, breakeven takes about 24.1 years and year-25 net savings are only about $800. Your own utility’s rate and rate growth are the biggest drivers of the result. This is a model estimate, not measured data.
Scenario
Year-1 savings
Payback
Net after 25 years
10.4¢/kWh, flat
~$915
~24.1 yrs
~$800
13.1¢/kWh, flat
~$1,150
~18.8 yrs
~$6,400
13.1¢/kWh, +3%/yr
~$1,150
~15.1 yrs
~$18,500
Panels typically carry a 25-year warranty, so these paybacks leave a modest margin in low-rate scenarios. Systems tend to pencil out better for homes with high usage, electric heat, an EV, or in higher-rate utility territory. Run your own numbers with the solar savings calculator and the solar payback calculator.
Neighboring states differ on rates and net metering rules. See our guides for Oregon, Idaho and Montana if you are comparing markets.
Solar vs utility company · 25-year comparison
25-year totals: 3%/yr rate increases, 0.5%/yr degradation, no federal credit. Methodology
Installers must hold the right Washington licensing, and the sales-tax exemption on labor requires the seller to be registered with the Department of Labor & Industries. Grid-connected systems also need a permit and inspection by your local authority.
Get at least three quotes, as EnergySage recommends. Each quote should state system size in kW, expected first-year kWh, price per watt, equipment brands, panel and workmanship warranties, and whether sales tax is exempted. NABCEP certification is voluntary but a useful quality signal.
Be cautious about pressure to sign at the first meeting, vague production guarantees, or claims of a federal credit for a purchased system in 2026. Ask each installer how their quote accounts for the end of the 25D credit and whether any lease or PPA pricing relies on the commercial credit.
Last verified October 5, 2026. Incentives and utility rules change; confirm current terms with your utility, the Washington Department of Revenue, and a tax professional.
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Washington installs averaged about $2.55 to $2.67 per watt in 2026 according to EnergySage marketplace data, so an 8 kW system costs roughly $20,400 to $21,400. Prices vary by installer, roof complexity and equipment. Washington's sales-tax exemption means qualifying systems up to 100 kW AC are not taxed on equipment or installation labor.
Not for homeowners who buy a system. The 30% federal residential credit (Section 25D) ended for expenditures after December 31, 2025 under the One Big Beautiful Bill Act, and Washington has no state income tax credit because it has no state income tax. What remains is the state sales-tax exemption and the exclusion of solar value from property tax assessment. Leased or PPA systems may still benefit from the commercial 48E credit, depending on the provider.
At the 2025 statewide average residential rate of 13.1 cents per kWh, an 8 kW system costing $20,800 pays back in about 19 years if rates stay flat and about 15 years if rates rise 3% a year. In low-rate utility territories near 10 cents per kWh, payback can reach about 24 years. These are model estimates; your result depends on your utility rate, roof orientation and shading.
Yes. Under RCW 80.60, utilities must offer retail-rate net metering for systems up to 100 kW until the earlier of June 30, 2029 or the date net-metered capacity reaches 4% of the utility's 1996 peak demand. Surplus credits roll over month to month and expire once a year, and the reset date depends on the utility. Several utilities have reached the threshold, so confirm your utility's current status before signing.
Yes, with lower output than sunnier states. A 1 kW system produces roughly 1,100 kWh per year in western Washington, about 1,300 kWh in eastern Washington, and about 1,800 kWh in Phoenix according to PVWatts-based estimates. Washington's low electricity rates, not its clouds, are the bigger factor in how long payback takes.
Washington solar by electric bill
See system size and payback for common monthly bills in Washington.
14.4¢/kWh — Washington average residential price. Source: EIA Electric Power Monthly, Table 5.6.B (year-to-date through July 2026), residential average retail price (July 2026) (EIA)
Solar production
4 peak sun hours/day × 0.82 system derate. Approximate state-average daily solar resource (peak sun hours) based on NREL solar resource data (NSRDB); not location-specific — use NREL PVWatts for an address-level estimate. (NREL PVWatts)
Installed price
$3.00 per watt before incentives. Blended 2026 US residential installed price used by this site; EnergySage marketplace reported about $2.60/W (mid-2026); full-market medians are higher.
Federal tax credit
$0 for homeowner-owned systems installed in 2026 — the 30% §25D credit ended Dec 31, 2025 (IRS)
Net metering
Full retail net metering — solar assumed to offset 87% of the bill. Washington requires retail-rate net metering until utility caps are reached.
Estimates only — not tax, legal or financial advice. Get at least three installer quotes and confirm incentives with your utility and a tax professional.