The short answer: it depends on where you live and whether you’re pairing solar with a battery.
The 30% federal residential clean energy credit (Section 25D) expired December 31, 2025. Per NC DEQ, installations completed from January 2026 onward don’t qualify. That expiry was confirmed by the One Big Beautiful Bill (Public Law 119-21), signed July 4, 2025, which shut down the residential credit with no extension. That credit was worth $7,500 on a $25,000 solar system. Its expiry changed the math significantly.
Solar isn’t dead in NC. But the case for it is narrower than it was in 2024, and some homeowners should wait rather than rush.
Key takeaways
- The 30% federal solar credit expired December 31, 2025. Zero for 2026 installations.
- Solar-only payback in Raleigh is now roughly 20 years at current electricity rates
- Charlotte homeowners can access Duke Energy’s PowerPair incentive ($9,000 max) by pairing solar with a battery
- NC sales tax and property tax exemptions still apply and reduce out-of-pocket costs
- Rising electricity rates improve the long-term case even when upfront payback looks slow
What changed at the end of 2025
Two things happened between 2024 and now. The federal credit expired, and net metering for new customers had already changed in October 2023.
The federal credit is gone. Before 2026, a $25,000 solar system earned a $7,500 federal tax credit. That knocked the effective cost down to $17,500 and made payback periods of 10-12 years realistic. Now the credit is zero. The same system costs $25,000 net (before NC exemptions), and the payback stretches to 20+ years at current rates.
Net metering changed in 2023. New solar customers don’t get retail-rate credits for power they export to the grid. Under the Net Metering Bridge, excess generation is credited at the avoided cost rate, which is 3.40¢/kWh for Duke Energy Progress (Raleigh) and 4.53¢/kWh for Duke Energy Carolinas (Charlotte). That compares to a retail rate of roughly 13-14¢/kWh for Duke Energy residential customers. Power you use directly from your panels still saves at the full retail rate. But every kilowatt-hour you over-produce and push to the grid earns about a quarter of what it used to.
For the full breakdown of how the current net metering options work, see the NC net metering guide.
These two changes together mean the financial case for solar in NC is meaningfully different from what it was 18 months ago. The rest of this guide works through the actual numbers.
What incentives are still available in NC?
North Carolina still has two meaningful tax provisions active, plus Duke Energy’s PowerPair program for homeowners who install solar and battery together. For the full breakdown of every current incentive, see the NC solar incentives guide. Here’s the short version.
NC sales tax exemption. Solar equipment is exempt from NC sales tax under G.S. 105-164.13 (NC General Assembly). On a $25,000 system, that’s roughly $1,750 back in your pocket at the current combined state and local rate.
NC property tax exemption. Under G.S. 105-277.3 (NC General Assembly), solar installations are excluded from your home’s assessed value. Your property tax bill won’t increase after installation. This also helps at resale, since buyers can see the panels without an inflated assessed value complicating the transaction.
Duke Energy PowerPair. This is the largest available upfront incentive: up to $9,000 for homeowners who install solar and battery storage together for the first time. It requires a Duke Energy Trade Ally installer and enrollment in a qualifying net metering rider for at least 24 months. One important caveat: Duke Energy Progress (Raleigh, Research Triangle) reached its allocation in early 2026 and is now waitlist-only. Duke Energy Carolinas (Charlotte) still has capacity as of April 2026, with 5,803 kW of 30,000 kW remaining (Duke Energy PowerPair).
For PowerPair details, eligibility, and how to apply, see the Duke Energy PowerPair guide.
The honest payback math
The answer depends on your territory, whether you’re adding a battery, and what your electricity bill looks like. Here are two honest scenarios.
Scenario 1: Solar-only in Raleigh (Duke Energy Progress)
| Item | Figure |
|---|---|
| 8 kW solar system, installed gross | ~$25,000 |
| NC sales tax exemption | -$1,750 |
| Federal tax credit | $0 (expired) |
| PowerPair | Not available (solar-only) |
| Net cost | ~$23,250 |
| Annual production (8 kW in NC) | ~11,000 kWh/year |
| Self-consumed (70% at 13.5¢/kWh) | ~$1,040/year |
| Exported (30% at Progress avoided cost: 3.40¢/kWh) | ~$112/year |
| Total annual savings | ~$1,152/year |
| Estimated payback | ~20 years |
This is the hard case. A 20-year payback on a system with a 25-year panel warranty leaves almost no buffer. If electricity rates stay flat, the financial return is thin. This scenario makes sense if you have a strong south-facing roof, a high electricity bill, and value energy independence or environmental impact beyond pure financial return.
Scenario 2: Solar + battery in Charlotte (Duke Energy Carolinas)
| Item | Figure |
|---|---|
| 8 kW solar + 13.5 kWh battery, installed gross | ~$38,000 |
| Duke Energy PowerPair (max) | -$9,000 |
| NC sales tax exemption (solar portion) | -$1,750 |
| Net cost | ~$27,250 |
| Annual production (8 kW in NC) | ~11,000 kWh/year |
| Self-consumed with battery (~85% at 13.5¢/kWh) | ~$1,262/year |
| Exported (15% at Carolinas avoided cost: 4.53¢/kWh) | ~$75/year |
| Total annual savings | ~$1,337/year |
| Estimated payback | ~20 years |
The headline payback looks similar. But several things shift the calculus. Battery backup has real non-financial value: grid resilience, automatic outage coverage, no disruption. The higher self-consumption rate means you’re getting full retail savings on a larger share of your production. And PowerPair is worth up to $9,000, more than the $7,500 the federal credit was worth on a typical system. For Charlotte homeowners who already want battery backup, pairing it with solar makes sense now.
For battery storage options and installed costs, see the battery storage page.
What makes the case stronger or weaker?
Not every roof and not every homeowner gets the same result.
Roof orientation and shading. A south-facing roof with minimal shading is the baseline for the production figures above. East- or west-facing roofs typically produce 15-20% less, which stretches the payback further. Heavy shading from trees, chimneys, or adjacent structures can cut production more. If your usable roof faces east and has partial shading, solar may not pencil out right now regardless of incentives.
Your electricity bill. High consumption means more opportunities for self-consumed solar savings. A $200+/month bill suggests you’re using 1,300+ kWh/month, and you’re likely to absorb most of what an 8 kW system produces. A $80/month bill means your system will over-produce regularly, and under current net metering, that surplus earns only the avoided cost rate. Match system size to consumption as closely as possible.
Your territory. Charlotte-area homeowners on Duke Energy Carolinas have access to PowerPair now. Raleigh-area homeowners on Duke Energy Progress are waitlisted. That difference is worth thousands of dollars in incentives and changes the math materially. Confirm your territory before making any decisions.
Planning to move in the next 5-7 years? The property tax exemption protects your assessed value and doesn’t create a complication at resale. But a 20-year payback period means you won’t break even before selling. If you’re planning to move soon, the financial case is harder to defend on payback math alone.
Does the rising electricity rate trend change the picture?
It doesn’t change the upfront payback calculation, but it changes what the system is worth over its full life.
Duke Energy has filed for and received several rate increases in recent years, with residential rates rising at roughly 3-5% annually on average. Every kilowatt-hour your panels produce is worth more in year 10 than in year 1, because the retail rate you’re avoiding is higher. Solar locks in your production cost at zero.
At flat rates, an 8 kW Raleigh system saves about $1,152/year. Apply a 4% annual rate escalation and cumulative savings over 25 years total approximately $48,000 against a $23,250 net system cost. The nominal payback falls around year 15 under that projection rather than year 20. At flat rates, the 25-year cumulative savings total around $28,800, a positive but narrow margin over the system’s life.
Rising rates improve the long-term case even when the current payback period looks long. That’s not a guarantee. Rates could change direction, and long-term projections carry real uncertainty. But the trend has been consistent.
Who should move forward now, and who should wait?
Move forward now if:
- You’re in Charlotte (Duke Energy Carolinas) territory, PowerPair capacity is still open, and you’re willing to install solar and a battery together
- Your electricity bill is above $150/month and you have a south-facing roof with minimal shading
- You value grid resilience and backup power as part of the equation, not just financial payback
- You want to act before PowerPair fills in Carolinas territory
Consider waiting if:
- You’re in Raleigh territory on Duke Energy Progress and relying on PowerPair, which is now waitlist-only
- Your roof isn’t ideally oriented or has significant shading
- You’re focused primarily on financial return and a 20+ year payback doesn’t work for your situation
- You want to see whether new federal incentives emerge or whether PowerPair reopens
The Raleigh situation is genuinely harder right now. The solar-only payback at current rates is difficult to defend as a purely financial investment without the federal credit. Waiting a year to see if PowerPair reopens or a new federal program appears is a reasonable choice for Progress-territory homeowners.
If you’re in Charlotte territory and thinking about adding a battery anyway, the window to act is open. As of April 2026, 5,803 kW of the 30,000 kW Carolinas program cap remained. That’s the actual status, not a sales pitch. When that capacity fills, the program closes.
For a quote on solar or a solar and battery system, see the solar installation page.