The Post-Incentive Era of Solar

A Market Built on Economics, Ownership, and Real Value

The solar industry is entering a transition year. Many of the incentives and conditions that fueled rapid growth over the past decade are disappearing or shifting, forcing companies to rethink how they operate, what they offer, and how they communicate value.

The Federal Incentive Era Is Ending

The era of solar powered by federal tax credits is over. With the Investment Tax Credit gone, projects must now stand on their own financial merit. The same applies to the EV tax credit, which often boosted the case for residential solar. The removal of these incentives signals a reset: performance, reliability, and economic return now drive decisions—not federal subsidies.

This transition will highlight installers who can design efficient, durable systems that deliver value without leaning on tax credits to close deals.

Tariffs, FEOC, and Domestic Content

New tariffs and “Foreign Entity of Concern” (FEOC) rules are reshaping supply chains. Installers will increasingly depend on domestic content to qualify for certain benefits. Long-term, this strengthens U.S. manufacturing. Short-term, it means unpredictable pricing, variable availability, and tighter margins.

This instability further reinforces the need for sound economics and operational efficiency.

States Now Set the Tone

With federal incentives fading, states become the primary policy drivers.

In places like Texas—where income-tax credits aren’t relevant—other mechanisms take the lead:

• Property-tax exemptions

• Accelerated depreciation

• Utility performance incentives

These reward capital investment and allow homeowners and businesses to treat solar and storage as productive assets, not symbolic environmental gestures.

This is a fundamentally conservative framework: adoption driven by value, competition, and self-reliance rather than recurring federal expenditure.

Industry Maturity: Efficiency Wins, Not Volume

Much of the turbulence of the last decade has cleared. Weak players have exited. What remains are companies with stronger discipline, better operations, and a focus on real long-term value.

As incentives shrink, efficiency and craftsmanship matter more:

• Transparent pricing over gimmicks

• Quality installs over rushed volume

• Lifetime customer relationships over transactional sales

The market will reward operational excellence and punish inefficiency.

The Customer Still Drives the Market

Even with incentives removed, customers still want:

• Control over energy costs

• Protection from utility volatility

• Confidence in equipment performance

• Independence and resilience

But expectations have matured. Transparency, service, and reliability now outweigh aggressive sales tactics or subsidized payback math.

The narrative around solar must evolve: this is no longer about virtue. It’s about cashflow, resilience, and independence from a grid experiencing real volatility.

The Storage Reality: Incentivize Supply, Not Demand

Battery pricing will only drop meaningfully if incentives push supply-side improvements:

• Better forecasting

• Scalable domestic manufacturing

• Clearer pricing signals

State-level incentives can support this shift by rewarding production rather than artificially inflating demand.

Installers Must Broaden Their Scope

Margins will tighten. Customer expectations will rise. Installers who succeed will expand into adjacent categories:

• Roofing

• Insulation

• Batteries

• EV charging

• Whole-home efficiency services

The winning model is an integrated energy business, not just a solar installer. As the industry matures, diversification mirrors what happened in HVAC, roofing, and other trades.

A Stronger, More Stable Industry Ahead

These disruptions mark progress—not decline. Removing incentives reduces distortion, forces clarity, and pushes the industry toward genuine innovation and customer trust. Solar and storage are now strong enough to stand without federal scaffolding.

The states and markets that embrace this shift first will define the next decade of American energy growth.

And the companies that adapt—leaner, more disciplined, more customer-centric—will build a more stable, credible, and future-proof solar market.