Will solar panels or energy upgrades raise my property taxes?

What the rule says

Whether solar panels, batteries, or efficiency upgrades raise your property taxes is decided by state law and applied by local assessors — there is no federal property tax on homes. The states reviewed here take three different approaches, and each one leaves value out of the property tax base under specific conditions.

California excludes the system from reappraisal. California Revenue and Taxation Code section 73 says that, for purposes of the state's constitutional "newly constructed" definition, new construction does not include the construction or addition of an "active solar energy system" — so the system's value is not treated as new construction that would trigger a reassessment. The statute defines an active solar energy system as a system that collects, stores, or distributes solar energy using solar devices thermally isolated from living space, and it can be used for water heating, space conditioning, electricity production, process heat, or solar mechanical energy. It does not include solar swimming pool heaters or hot tub heaters. For systems that produce electricity, the exclusion covers storage devices, power conditioning equipment, transfer equipment, and related parts up to — but not including — the point where electricity is conveyed or used. The California State Board of Equalization's property tax training materials describe this exclusion and how assessors apply it. Critically, the statute is currently set to become inoperative on January 1, 2027 (as amended by Stats. 2025, Ch. 328, SB 710, effective January 1, 2026), and systems that qualify before that date continue to be excluded only until a subsequent change in ownership.

Florida excludes the device's value from the assessment. Florida Statutes section 193.624 defines a "renewable energy source device" broadly — solar energy collectors, photovoltaic modules and inverters, storage tanks, windmills and wind turbines, power conditioning and storage devices, and related integral components, but not conventional backup systems or equipment on the utility side of the interconnection point. Under the statute, in determining the assessed value of residential real property, the just value attributable to such a device may not be considered at all; for nonresidential property, 80 percent of that just value may not be considered. The statute applies to devices installed on or after January 1, 2013 on residential property and on or after January 1, 2018 on other real property (with a narrow exception for certain projects in fiscally constrained counties). The 2017 amendments that set these terms expire on December 31, 2037, when the text reverts to its earlier version.

Texas exempts the device's appraised value. Texas Tax Code section 11.27 exempts from property taxation the amount of appraised value associated with the installation or construction of a solar or wind-powered energy device. The Texas Comptroller of Public Accounts publishes guidelines for this exemption (as required by Tax Code section 5.05) that define the devices, explain how appraisers value them, and set the application procedures: a property owner files Form 50-123, and the county's chief appraiser decides whether the property qualifies. The current guidelines edition was published in May 2022, and they describe the exemption as applying regardless of whether the owner owns the real property on which the device is installed.

Which authority controls

Property tax exemptions are creatures of state statute, interpreted and applied by state tax authorities and local officials. In California, the county assessor applies Revenue and Taxation Code section 73 during the assessment process, and the State Board of Equalization publishes training and guidance for assessors. In Florida, the county property appraiser applies Florida Statutes section 193.624 when determining assessed value; no separate state agency approval appears in the statute. In Texas, the Comptroller of Public Accounts issues the exemption guidelines and the application form, but the county appraisal district's chief appraiser makes the actual qualification decision on each application. State statute is the controlling authority; state agency guidance and the DSIRE incentive database (a discovery reference only) help you find and understand the rules.

What may still be required or restricted

Exemptions are not automatic everywhere, and each state's rules carry conditions:

• Applications and deadlines. In Texas, the Comptroller's guidelines say property owners must file the exemption application on or before April 30, the chief appraiser may extend that deadline by written order for up to 60 days for good cause, and an owner who fails to file timely may not receive the exemption for that year. If the appraisal district requests more information, the applicant has 30 days to respond.
• Device definitions. Each state limits what counts. California's exclusion does not cover solar swimming pool heaters or hot tub heaters. Florida's exclusion does not cover conventional backup systems or equipment on the utility side of the interconnection point. Texas's exemption covers devices that meet the definitions in the Comptroller's guidelines, and the guidelines discuss separate appraisal methods (market, income, and cost approaches) for valuing them — with Tax Code section 23.26 requiring the cost method for solar devices used for commercial purposes.
• Sunset dates. California's exclusion is set to become inoperative January 1, 2027; Florida's 2017 amendments expire December 31, 2037. Both are subject to legislative change, so the rule in effect when you install or buy matters.
• Ownership changes. California's statute says systems qualifying before January 1, 2027 remain excluded after that date only until a subsequent change in ownership — meaning a sale can end the exclusion. In Texas, the exemption follows qualifying devices but the owner must file the application by the deadline, so a buyer who wants the exemption should confirm the filing status and file if needed.
• Separate rules remain. Property tax treatment does not change HOA, permit, or utility interconnection rules, and it is unrelated to income tax credits or to how insurers value a home for replacement-cost coverage. Who owns the system can also matter in shared-ownership settings such as condominiums, where the assessment and the benefit may not land on the same owner.

Facts that could change the answer

The biggest variables are time and location. California's exclusion sunsets January 1, 2027 unless the legislature extends it. Florida's current exclusion terms expire December 31, 2037. Texas's rules could change with the legislature, and the May 2022 guidelines may not reflect later amendments — the Comptroller's current exemptions page should be checked. Local assessor practice, the exact equipment installed, whether the system was part of new construction or an addition to an existing home, and whether the property changes ownership can each change the result in a specific case.

Practical decision path

1. Identify your state's rule from an official source — your state tax agency, revenue department, or assessor's office — and use a database such as DSIRE only to find programs, not as the final word.
2. Check whether your equipment fits the state's definition of a qualifying device, and keep the equipment list from your installer.
3. File any required application by the deadline — in Texas, Form 50-123 on or before April 30 for the current year.
4. Review the assessment notice you receive and confirm the excluded or exempted value appears as expected; raise questions with the assessor or appraisal district before the deadline to protest.
5. When buying or selling, ask about the system's exemption or exclusion status, any pending applications, and any PACE or other assessments collected on the property tax bill — and see the related guides on selling a home with solar financing and on PACE obligations.
6. Before work begins, obtain the written requirement from the tax authority or program administrator and keep the record.

Records to keep

Keep the exemption application and proof of filing (Form 50-123 in Texas), any approval or denial letter, assessment notices showing the excluded or exempted value, itemized installation invoices with equipment lists, interconnection documents, and — if the system is financed — the loan or PACE records that may appear on the tax bill. If you are buying or selling, keep the closing documents and any written statement about the system's exemption status or pending reassessment.

When professional advice may help

Property tax law is state-specific and changes frequently, and sunsets like California's January 1, 2027 date can make a difference of years of tax savings. If your system is large, commercial, shared between owners, subject to a pending sale, or the assessor disputes the exclusion, consult the assessor or appraisal district first and, if the amount at stake justifies it, a local property tax professional or attorney who works with that jurisdiction.