With the federal credit gone, Colorado solar pays back on bill savings alone, and your utility sets the terms. In our example a typical owned system takes about 12 years at Xcel Energy with today’s one-for-one credits, and about 17 under the new Colorado Springs Utilities rates.
Simple payback before incentives, Xcel todayAbout 12 years
Today or Colorado Springs 2027About 12 to 17 years
Typical owned 7.00 kW system at $21,140 cash (EcoGen Solar Cost Index, September 2026), no incentives, Xcel Energy’s EIA price of 16.722¢ less its $7.10 monthly charge (15.506¢), exports credited one for one, less 3.25% riders. No upkeep and no price rises. The 2027 Colorado Springs figure is a projection. See the math.
- Utility: each one settles leftover credits its own way.
- System size: match a year of your use; extras pay pennies.
- Agreement date: in Colorado Springs, before April 1, 2027 keeps today’s rates until April 1, 2032.
2026 rules: new home systems get no 30% federal homeowner credit (IRS). State law still requires one-for-one credits for extra solar power. Colorado Springs Utilities has new solar rates from April 1, 2027.
How we checked this guide
Rules come from Colorado statutes and the utilities’ own pages and forms; the price from the U.S. EIA; the example system from the EcoGen Solar Cost Index. Assumed numbers are labelled.
The writer and checker shown above are EcoGen staff. EcoGen is paid when homeowners request quotes, which is explained beside the quote form. Read our editorial standards.
What decides a Colorado solar answer in 2026
Since the federal credit ended, the answer depends on your utility, the system’s size next to your use, the roof and how you pay. Read each row across.
Your utility
Worth a closer look
Your utility credits extra kWh one for one, and you have its year-end rule in writing.
Pause and check
Colorado Springs, an agreement dated from April 1, 2027, and a quote that ignores the new rates.
Check next: the utility and rate the quote modeled.
System size
Worth a closer look
The system makes about what your home uses in a year.
Pause and check
Sized well past your use. Xcel pays leftover kWh at 1.529 cents per kWh unless you choose rollover.
Check next: your last 12 months of kWh next to the quote’s year-one output.
Roof and hail
Worth a closer look
A roof with years left, and hail-rated panels quoted.
Pause and check
A roof due for replacement soon, or no hail terms.
Check next: roof age, hail rating and your insurer’s rules.
Price and time in home
Worth a closer look
Near the Index’s $21,140 for 7.00 kW ($3.02 per watt), and you will stay past payback.
Pause and check
A dealer fee, a quote that subtracts a federal credit, or a move soon.
Check next: cash and financed prices, with APR and fees.
What the credit sunset took away, and what is left
The federal homeowner credit is not available for systems installed after December 31, 2025. A Colorado buyer now pays full price. The state has no income tax credit for home solar either: its 2025 income tax credit schedule (form DR 0104CR) lists none. What the state still gives:
- One-for-one bill credits under C.R.S. 40-2-124. Co-ops and city utilities with 5,000 or more customers must net meter home systems up to at least 10 kW.
- No 2.9% state sales tax on solar equipment (C.R.S. 39-26-724). Labor is taxed, and local sales taxes are separate.
- No property tax on home solar equipment (C.R.S. 39-3-102), even when a company owns it.
Cash for panels reaches few homes. Income-qualified Xcel customers can get $3 per watt: $21,000 on a typical 7.00 kW system. But the 2026 budget is $1,000,000, and Xcel posted notices in September 2026 that could change the terms, so count it only once reserved. Holy Cross Energy members get $100 per kW, or $700 on a typical system.
One Colorado system under two utility rule sets
Simple payback is the years your savings take to cover what you paid: net cost divided by yearly savings. A kWh (kilowatt-hour) is the unit on your power bill. An export credit is what you get for each kWh your panels send to the grid. In Colorado it is a kWh you can use later, so it is worth the full price as long as you use it before year end.
- Cash price
- $21,140
- Confirmed incentives
- $0
- Year-one production
- 11,592 kWh
- Used at home / exported
- 40% / 60%
- Xcel price for power you use (EIA, 12 months, less $7.10 a month)
- $0.15506/kWh
- Export credit
- $0.15506/kWh
- Xcel riders billed as a percentage (3.25%)
- $58/yr
- Used-at-home value
11,592 × 40% × $0.15506$719/yr - Export value
11,592 × 60% × $0.15506$1,078/yr - Yearly savings after riders
$719 + $1,078 − $58$1,739/yr - Simple payback before incentives
$21,140 ÷ $1,739about 12.2 years
Inputs: the EcoGen Solar Cost Index typical Colorado system (7.00 kW, $21,140 cash, September 2026; 1,656 kWh per kW a year). No credit or rebate. Exports count at full price, as state law credits them one for one, so the 40/60 split does not change the result. Xcel’s price is its EIA average of 16.722¢ for August 2025 to July 2026, less its $7.10 monthly service and facility charge, which solar does not cut. The riders are the 3.25% Xcel bills as a percentage. No upkeep and no price rises are counted (EcoGen per-utility payback figures, October 19, 2026). On the same basis: Black Hills 10.5 years, CORE Electric 12.5, Colorado Springs Utilities 14.8.
Now move the same house to Colorado Springs, with an agreement dated from April 1, 2027. The new solar rates offer two options. The grid access option charges $1.00 a day, credits exports by time of day and does not roll credits over. The demand option charges for your highest 15 minutes of use at peak (5 to 9 p.m., Monday to Friday) and keeps one-for-one rollover. The utility projects both at about $38 a month more on the average bill, or about $456 a year. We add that projected increase to the yearly costs to show its effect; it is not an upkeep bill.
| Scenario | Yearly owner costs | Savings before costs | Yearly savings | Simple payback |
|---|---|---|---|---|
| Xcel, today’s credits | $58 | $1,797 | $1,739 | about 12.2 years |
| Colorado Springs, 2027 rates (projection) | $666 | $1,922 | $1,256 | about 16.8 years |
In Colorado Springs the agreement date matters: agreements dated before April 1, 2027 keep today’s rates until April 1, 2032. On today’s rates our utility figures give about 14.8 years there.
Test your own Colorado quote
The tool starts with today’s credits. Enter your quote’s price and output and your own power price, then press Calculate. Nothing you enter is sent anywhere.
Example result
about 12.2 years
simple cash payback
- Used-at-home value
- $719/yr
- Export value
- $1,078/yr
- Owner costs
- −$58/yr
- Yearly savings
- $1,739/yr
- Net cost
- $21,140
The example uses Xcel’s price, with its 3.25% riders ($58) as owner costs. To test the new Colorado Springs rates, add the utility’s yearly estimate above to owner costs. Flat first-year values; rates, panel wear and repairs will change the result.
Where Colorado credits lose value: the year-end settle
Power you send out comes back as a kWh you use later. The loss comes once a year, when the utility settles unused kWh, so an oversized system banks credits it cannot spend.
Used at home: 4,637 kWh. Each one replaces power you would have bought, so it saves the full variable rate ($0.15506 at Xcel here).
Sent to the grid: 6,955 kWh. These earn whatever your utility pays for exports ($0.15506 at Xcel here). Here that matches the price you pay, but check your utility’s rule.
Colorado homes paid an average of 16.58¢ per kWh from August 2025 to July 2026 (EIA). The typical system makes about 11,592 kWh a year; compare that with your bills.
| Utility | Leftover credits at year end | What to watch |
|---|---|---|
| Xcel Energy | Paid at 1.529 cents per kWh (2023) unless you choose rollover. | Rollover is permanent. Switch by December 1. |
| Black Hills Energy | Rolled forward, or paid yearly if you choose it in writing. | Ask for the payout rate in writing. |
| Colorado Springs Utilities | Paid in January at about 2 cents per kWh unless you elect rollover. | New rates from April 1, 2027. |
| CORE Electric Cooperative | Paid or credited after the April bill, at its avoided cost. | Net metering up to 10 kW only. |
Find out which Colorado utility rules apply to you
Ask which utility rate each quote modeled and what leftover credits earn.
Solar providers that serve your area may contact you, and they pay EcoGen for the introduction. How we make money.
Hail, insurance and the roof under the panels
Colorado is hail country. The fixes are plain, but a sales pitch can skip them.
- Hail-rated panels. Get the model, its hail rating and a warranty that names hail in the quote.
- Your insurer first. Some carriers add a rider, raise the premium or exclude solar. Ask before the install, not after a storm.
- Roof and panels as one purchase. If the shingles will need replacing during the panels’ life, replace them first; removing panels later costs extra.
Cash, loan, lease or PPA after the credit ended
Owning gives the shortest payback but means full price. A lease or power purchase agreement (PPA) needs little money upfront: a long contract for monthly savings, which is what “free solar” offers are. Would you sign one that long for any other utility service?
| Option | Who owns the panels | Upfront | Ongoing | Check before signing |
|---|---|---|---|---|
| Cash | You | Full price | None. | A size based on your bills, and your year-end choice. |
| Loan | You | Often $0 | Loan payment plus your utility bill. | Cash vs financed price. A dealer fee adds years. |
| Lease | Solar company | Often $0 | Lease payment plus your utility bill. | The escalator, buyout price and rules if you sell. |
| PPA | Solar company | Often $0 | A price per kWh the panels make. | The PPA rate next to the 16.58¢ average, and how it rises. |
See our solar financing guide. Batteries have their own help: a 10% state tax credit through tax year 2029, and at Xcel $250 per kW to $1,000 per kW of battery power if Xcel may use up to 80% of it, up to 60 times a year.
What a Colorado solar quote has to answer
The installer matters more than the panel brand here. Ask each one how many systems it has connected with your utility in the past year.
- Utility and rate. Your utility by name and the rate assumed; in Colorado Springs, which new option.
- Size against your use. Year-one kWh next to a year of bills.
- Year-end choice. At Xcel, rollover or payout, sent by December 1 to count this year.
- No federal credit subtracted. It ended after December 31, 2025.
- Hail and roof terms. Hail rating, hail warranty wording, roof life left.
- Cash and financed prices. Both totals, with any dealer fee shown.
Compare Colorado solar quotes
Ask each installer to name your utility and size the system to your bills. Enter your ZIP code to request quotes from solar providers that serve your area.
How EcoGen is paid
EcoGen America does not sell or install solar. When you request quotes, we pass your request to solar providers serving your area, and they pay us for the introduction. Providers can include installers, solar marketplaces and lead exchanges, and more than one may contact you. You never pay us.
More Colorado solar guides
- Colorado solar guide: utilities, incentives and installers in one place
- Colorado solar companies: compare local installers before you request quotes
- Colorado solar incentives: bill credits, battery credits and utility rebates
- What solar costs in Colorado
- Free solar panels in Colorado: leases, PPAs and income programs
- Are solar panels worth it? The national guide and payback calculator
All 51 state guides
Colorado solar questions after the sunset
Are solar panels worth it in Colorado without the federal tax credit?
They can be for a home that stays put. The homeowner credit ended after December 31, 2025, so bill savings carry the cost. In our example a typical owned system pays back in about 12 years at Xcel with today’s credits, about 17 on the new Colorado Springs rates.
Does Xcel Energy still give full credit for solar power I send to the grid?
Yes. Under C.R.S. 40-2-124, Xcel credits each extra kWh against a kWh you use later. Year end is different: send no form and Xcel pays leftover kWh 1.529 cents per kWh. Choose rollover and they stay on your account instead.
How much does a solar system cost in Colorado in 2026?
The EcoGen Solar Cost Index puts a typical 7.00 kW Colorado system at $21,140 in cash before incentives, or $3.02 per watt (September 2026). Solar equipment skips the 2.9% state sales tax, but labor does not, and city and county sales taxes are separate.
Is hail a reason to skip solar along the Front Range?
Not on its own, but it changes what to buy. Ask for hail-rated panels and a warranty that names hail, and tell your insurer before the install. If the roof will need replacing during the panels’ life, replace it first.
Do I need a battery to make solar worth it in Colorado?
No. With one-for-one credits, the grid stores your extra power. A battery helps with outages. Colorado gives a tax credit of 10% of its price through tax year 2029, and Xcel pays $250 per kW to $1,000 per kW of battery power.
Can my HOA block solar panels in Colorado?
No. Under C.R.S. 38-30-168, a covenant that prohibits or restricts solar is void. An HOA may set reasonable rules on size, placement and looks, but not ones that raise the cost or cut output by more than 10%. An application not answered within 60 days counts as approved.
What changes for Colorado Springs Utilities solar customers?
Agreements dated from April 1, 2027 get new rates: a daily grid access charge or a peak demand charge. The utility estimates about $38 a month more on a solar bill. Earlier agreements keep today’s rates until April 1, 2032.
Sources, method and corrections
The example uses the EcoGen Solar Cost Index typical Colorado system (September 2026) and Xcel Energy’s EIA 12-month price less its fixed monthly charge, from EcoGen’s per-utility payback figures of October 19, 2026, with no upkeep and no price rises. An exported kWh that you use later is valued at the full price, as state law credits it one for one, so the 40/60 split does not change the result. The Colorado Springs 2027 case is a projection: the EIA state average, $210 a year in owner costs ($30 per kW, including a reserve for a new inverter) and the projected bill increase added as a yearly cost. Simple payback uses flat first-year values. The calculator runs in your browser and sends nothing.
Updated October 2026: 40% home use and 60% exports, owner costs of $30 per kW a year, and the two Colorado Springs options told apart.
Corrected: Xcel’s income-qualified rebate, the battery credit’s end year, the sales tax wording and the September 2026 prices.
Spotted an error? Tell us through our corrections and feedback process.
- C.R.S. Title 40: net metering (40-2-124) (checked September 30, 2026)
- Xcel Energy: Solar Bank Election Form
- Xcel Energy: Solar*Rewards
- Colorado Springs Utilities: solar rate changes (checked October 5, 2026)
- Holy Cross Energy: go solar
- CORE Electric Cooperative: rooftop solar
- C.R.S. Title 39: sales tax and battery credit
- Colorado Division of Property Taxation
- C.R.S. 38-30-168: HOA limits
- U.S. EIA: average residential electricity price by state (12-month average)
- IRS: Residential Clean Energy Credit
- EcoGen Solar Cost Index, September 2026: Colorado
