The Federal Solar Tax Credit Is Gone — What Riverside Homeowners Can Still Claim in 2026

Let’s start with the bad news, because you’ve probably already run into it: the 30% federal residential solar tax credit is gone. If you’re mid-quote this fall and just found out, you’re not alone.

The good news is that the story doesn’t end there. Here’s what actually changed, what’s still available, and how to tell whether solar still makes sense for your Riverside-area home.

What ended

The homeowner credit (the Residential Clean Energy Credit) ended for spending after December 31, 2025, following the federal budget law signed in July 2025. If your system was installed and paid for in 2025, you can still claim it on that year’s return. For a system bought in 2026, there’s no credit for the purchase itself, batteries included.

Here’s the math. With the credit, you effectively paid 70% of the sticker price. Without it, you pay 100%, which is about 43% more out of pocket for the same system. Any honest payback estimate has to start from that number.

What that does to payback

A system that used to take a certain number of years to pay for itself now takes longer, because the starting cost is higher. How much longer depends on the size of your bill, your rate plan and how much of your solar you use yourself. A home with big summer bills gives up less payback time than a home with small ones, because there’s more savings to divide the cost against.

We’re not going to hand you a payback number in a blog post, because it would be a guess. What we can tell you is what moves it: the price of the system, what you pay per kWh, how much power you use after sunset, and whether a battery is part of the plan.

What’s still on the table

• Leases and power purchase agreements. Under current federal rules, a business credit for third-party-owned solar continues through 2027, and the installer can pass some of that value along in your monthly payment. It isn’t right for everyone, but it’s worth a look. See our financing and leasing options.
• Financing. A loan can turn a big upfront cost into a monthly payment you compare against your current bill.
• Your utility bill itself. Southern California Edison rates remain high, and much of Riverside is served by SCE, while the city of Riverside has its own utility with its own rates and solar rules. SCE’s January 2026 rate adjustment was a small decrease for a typical customer, but bills are still steep after big increases in recent years.
• State battery programs. Programs like SGIP have tight eligibility and limited funds, so don’t count on one until it’s confirmed for your home.

Buy, finance or lease: a quick comparison

Each path fits a different kind of household.

• Paying cash gives you the lowest total cost over time, and it makes the most sense if you have the money on hand and plan to stay put.
• Financing spreads the cost out. The question to ask is whether your monthly payment is lower than the bill you’d be avoiding, and what the interest adds up to.
• Leasing or a power purchase agreement lowers or removes the upfront cost, and the installer keeps the business credit. You typically don’t own the system, so it’s worth reading the contract terms, including what happens if you sell your home.

Which utility do you have?

This one matters more than most people expect. Much of the city of Riverside is served by Riverside Public Utilities, and a few nearby communities also have their own municipal utilities, while others are served by SCE. Solar rules, export credits and rate plans differ by utility. Before you compare quotes, check who actually sends you the bill.

Is it still worth it?

Sometimes yes, sometimes no, and that’s the honest answer. Solar still tends to pencil out for homes with high summer bills, air conditioning that runs a lot, an EV, a pool, or a long stay ahead. It’s a harder sell if your bill is already low, your roof is heavily shaded, or you may move in a couple of years. California’s export rates are also lower than they used to be, so pairing solar with a battery to use more of your own power often changes the numbers.

Questions to ask any solar company

1. What’s the total price before and after any incentives?
2. What export credit and rate plan did you assume, and for which utility?
3. How did you estimate my production, and what happens if the system underperforms?
4. If I lease or finance, what are the full terms, including what happens if I sell?
5. Would a battery change the numbers for my usage?

The best next step is a savings estimate built on your real usage, not an average. It takes a few minutes to compare your current bill against the post-credit math.

Get your free updated solar savings estimate. See solar and storage or our Riverside page. Call 800-306-6953 or visit empoweryourhome.com.