Best States for Solar in 2026: Ranked by ROI

Not all states are equal when it comes to solar. The best states combine high electricity rates, abundant sunshine, strong incentives, and favorable net metering policies. Here's our ranking.

Top 10 States for Solar ROI

1. Hawaii

Sun hours: 6.0 PSH
Electricity rate: $0.33/kWh
State incentive: 35% tax credit (capped)
Payback: 4–6 years
Why: Highest rates in the nation + great sun + strong state credit

2. California

Sun hours: 5.5 PSH
Electricity rate: $0.22–$0.35/kWh
State incentive: SGIP battery rebate
Payback: 5–7 years
Why: Extremely high rates make solar essential; SGIP makes batteries affordable

3. Arizona

Sun hours: 6.5 PSH
Electricity rate: $0.13–$0.16/kWh
State incentive: 25% tax credit (up to $1,000)
Payback: 7–9 years
Why: Most sun in the continental US + property tax exemption

4. New York

Sun hours: 4.5 PSH
Electricity rate: $0.20/kWh
State incentive: 25% tax credit (up to $5,000) + NY-Sun
Payback: 6–8 years
Why: High rates and generous state incentives overcome moderate sun

5. Massachusetts

Sun hours: 4.1 PSH
Electricity rate: $0.25/kWh
State incentive: SMART program + SRECs
Payback: 6–8 years
Why: Performance-based incentives stack with high electricity rates

6. Nevada

Sun hours: 6.5 PSH
Electricity rate: $0.12/kWh
State incentive: Property tax abatement
Payback: 8–10 years
Why: 300+ sunny days per year; lower rates offset by massive production

7. New Jersey

Sun hours: 4.2 PSH
Electricity rate: $0.16/kWh
State incentive: SREC-II market + property tax exemption
Payback: 7–9 years
Why: Ongoing SREC income from solar production

8. Connecticut

Sun hours: 4.0 PSH
Electricity rate: $0.24/kWh
State incentive: RSIP rebate + property tax exemption
Payback: 7–9 years
Why: Among the highest electricity rates in the US

9. New Mexico

Sun hours: 6.0 PSH
Electricity rate: $0.13/kWh
State incentive: 10% tax credit (up to $6,000)
Payback: 8–10 years
Why: Excellent sun + strong state tax credit

10. Maryland

Sun hours: 4.2 PSH
Electricity rate: $0.15/kWh
State incentive: SRECs + state grant (up to $5,000)
Payback: 8–10 years
Why: SREC market provides ongoing income from solar

What Makes a State "Good" for Solar?

Three factors determine solar ROI:

Electricity rate: Higher rates = faster payback. Every $0.05/kWh increase can shave 2–3 years off your payback.
Peak sun hours: More sun = more energy production. Arizona's 6.5 PSH produces 40% more energy than New York's 4.5 PSH with the same system.
Incentives: State tax credits, rebates, and SREC markets can reduce your net cost by an additional 10–25%.

Find Your State's Solar Potential

Browse our state-by-state solar guides to see detailed information for your state, including incentives, sun hours, and savings estimates. Or run our free AI Home Energy Advisor for a personalized analysis based on your ZIP code.