Is solar worth it in Arkansas?
For a typical Arkansas home in 2026, solar is a close call: about a 14.5-year payback and $20,493 saved over 25 years after paying for the system. Check your own home, because roofs, usage and utilities vary a lot.
- Payback, typical home
- 14.5 yrs8 kW, paying cash
- Electricity price
- 13.4¢per kWh, U.S. 18.0¢
- Solar production
- 1,402kWh per kW per year
- Exports credited at
- ~30%Avoided-cost export credit
The numbers for a typical Arkansas home
| Electricity use | 1,042 kWh a month (Arkansas average) |
|---|---|
| Best-value system | 8 kW, producing 11,216 kWh a year (90% of use) |
| Price | $21,500 at about $2.75/W |
| First-year savings | $1,469 |
| Payback | 14.5 years |
| 25-year net | $20,493 (5.4% a year return) |
| Rate increase assumed | 2.7% a year, from Arkansas's 2015–2025 history |
Paying cash, no federal credit, 5% discount rate, microinverters, $25 per kW a year for maintenance and repairs. Methodology.
Why it comes out this way
- Electricity is cheap: 13.4¢ per kWh, 25% below the U.S. average (18.0¢), so each solar kWh saves less.
- Exported solar is typically credited at about 30% of retail, so systems pay best when sized for what you use yourself.
- A typical system here produces about 1,402 kWh per kW per year (ranked #23 of 51).
- There is no federal tax credit for homeowners who buy in 2026, which adds several years to payback compared with 2025.
Net metering and export rules in Arkansas
Avoided-cost export credit. Under Act 278 of 2023, new solar customers (applications after Sept 30, 2024) still offset their own usage at retail, but any excess electricity sent to the grid is credited only at the utility's avoided cost, often under half of retail. Customers who connected earlier keep 1:1 retail credit through 2039-2040.
Net excess generation credited at the utility's avoided cost (wholesale energy value), set per utility.
- Netting: monthly
- Unused credits: Excess credits carry forward at avoided-cost value; legacy customers keep kWh banking at retail. Exact rollover/expiration terms vary by utility tariff (not verified).
- System size limit: 25 kW
- Fixed charges: Act 278 permits utilities to recover certain costs from net-metering customers; standard customer charges apply. No specific statewide solar fee confirmed.
- Last major change: Act 278 (signed Mar 2023); net billing at avoided cost effective for new customers from Oct 1, 2024. Legacy customers grandfathered for 20 years (through ~2040).
Read net metering explained to see why export rules can swing payback by years.
| Utility | Export credit | Notes |
|---|---|---|
| Entergy Arkansas | ~30% of retail | Net excess generation credited at avoided cost per its net metering rider; current value not verified. |
| Southwestern Electric Power Co. (SWEPCO) | Avoided-cost export credit | Act 278 avoided-cost credit. |
| Oklahoma Gas & Electric (Arkansas) | Avoided-cost export credit | Act 278 avoided-cost credit. |
Solar incentives in Arkansas
The federal 30% Residential Clean Energy Credit ended for systems installed after December 31, 2025. What that means.
| Program | Type | What you get | Status |
|---|---|---|---|
| No state solar incentives | other | Arkansas has no state solar tax credit, rebate, or solar-specific sales/property tax exemption for residential systems. Federal 25D ended for expenditures after 2025. Eligibility: n/a | unknown |
What solar costs in Arkansas
A fair cash price is around $2.75 per watt before incentives. For the 8 kW system that fits a typical home, expect roughly $18,700 to $26,400; smaller systems cost more per watt.
How many homes have solar
- Homes with net-metered solar (2025)
- 19,458
- Share of homes
- 1.3%
- Residential solar capacity
- 182 MW
- Growth over the past year
- +1.5%
Sources: EIA-861 (2025), EIA small-scale solar estimates, LBNL Tracking the Sun and state interconnection data.
Electric utilities in Arkansas
| Utility | Homes served | Price (2026 est.) | Typical use | Typical-home verdict |
|---|---|---|---|---|
| Entergy Arkansas | 612,254 | 13.9¢ | 1,085 kWh/mo | Close call |
| SWEPCO | 109,777 | 13.5¢ | 1,104 kWh/mo | Not worth it |
| Carroll Electric Cooperative | 104,579 | 14.0¢ | 1,067 kWh/mo | Close call |
| First Electric Cooperative | 96,685 | 13.5¢ | 1,202 kWh/mo | Close call |
| Ozarks Electric Cooperative | 74,247 | 14.5¢ | 1,018 kWh/mo | Close call |
| OG&E | 58,569 | 12.9¢ | 1,045 kWh/mo | Close call |
| Arkansas Valley Electric Cooperative | 55,000 | 14.7¢ | 1,104 kWh/mo | Worth it |
| North Arkansas Electric Cooperative | 36,595 | 14.8¢ | 1,011 kWh/mo | Worth it |
| City of North Little Rock | 35,721 | 13.0¢ | 898 kWh/mo | Close call |
| City Water and Light Plant | 35,335 | 7.4¢ | 1,258 kWh/mo | Not worth it |
| Conway Corporation | 31,376 | 9.9¢ | 1,006 kWh/mo | Not worth it |
| Craighead Electric Cooperative | 25,180 | 13.0¢ | 1,344 kWh/mo | Close call |
| Southwest Arkansas E C C | 24,974 | 14.5¢ | 1,272 kWh/mo | Worth it |
| City of Bentonville | 22,559 | 12.3¢ | 1,084 kWh/mo | Close call |
| C & L Electric Cooperative | 20,020 | 14.4¢ | 1,097 kWh/mo | Close call |
| Petit Jean Electric Cooperative | 18,878 | 17.3¢ | 960 kWh/mo | Worth it |
| City of Benton | 13,371 | 10.8¢ | 996 kWh/mo | Not worth it |
| Paragould Municipal Utilities (AR) | 12,647 | 9.4¢ | 1,382 kWh/mo | Not worth it |
| Woodruff Electric Cooperative | 12,100 | 13.1¢ | 1,201 kWh/mo | Close call |
| Clay County Electric Cooperative | 10,503 | 15.1¢ | 930 kWh/mo | Worth it |
| City of West Memphis | 10,187 | 8.8¢ | 1,150 kWh/mo | Not worth it |
| South Central Ark El Cooperative | 9,447 | 16.8¢ | 981 kWh/mo | Worth it |
| City of Siloam Springs | 9,137 | 12.0¢ | 861 kWh/mo | Not worth it |
| Ouachita Electric Cooperative | 8,392 | 14.1¢ | 1,026 kWh/mo | Close call |
| City of Hope | 5,792 | 12.9¢ | 935 kWh/mo | Close call |
Solar by city in Arkansas
- Little Rock14.2-yr payback · Close call
- Fayetteville14.8-yr payback · Close call
- Fort Smith14.7-yr payback · Close call
- Springdale14.6-yr payback · Close call
- Jonesboro14-yr payback · Close call
- Rogers14.5-yr payback · Close call
- Conway13.8-yr payback · Close call
- North Little Rock13.8-yr payback · Close call
- Bentonville14.6-yr payback · Close call
- Pine Bluff13.9-yr payback · Close call
- Hot Springs14.6-yr payback · Close call
- Benton14.2-yr payback · Close call
- Sherwood13.8-yr payback · Close call
- Bella Vista14.7-yr payback · Close call
- Paragould13.8-yr payback · Close call
- Jacksonville13.5-yr payback · Close call
- Texarkana14-yr payback · Close call
- Russellville14.3-yr payback · Close call
- Cabot13.9-yr payback · Close call
Protect yourself when buying
- Check the license. Arkansas Contractors Licensing Board (residential/commercial contractor license as applicable) and a licensed electrician/master electrician via the Arkansas Board of Electrical Examiners (Dept. of Labor and Licensing). Look up an installer
- Cancellation rights. Federal law gives you 3 business days to cancel most door-to-door sales over $25. How to cancel
- HOA and solar access. No statewide solar access/HOA protection law.
- Community solar. Limited: net-metering law permits shared/community facilities and some co-ops offer subscriptions; no robust statewide program after Act 278.
Installers active in Arkansas
Ranked by installations in public records, not by payment. Volume isn't quality: always check licenses and reviews.
- Stellar Solar 9 installs
- Sun Solar Energy Solutions 1 installs
Questions about solar in Arkansas
Is solar worth it in Arkansas in 2026?
For a typical Arkansas home, solar is a close call. A 8 kW system costing about $21,500 after state incentives saves about $1,469 in the first year and pays back in about 14.5 years. Your result depends on your roof, usage, utility and price, so run the calculator for your address.
How much do solar panels cost in Arkansas?
A reasonable cash price is around $2.75 per watt before incentives, or roughly $18,700 to $26,400 for a 8 kW system.
Does Arkansas have net metering?
Under Act 278 of 2023, new solar customers (applications after Sept 30, 2024) still offset their own usage at retail, but any excess electricity sent to the grid is credited only at the utility's avoided cost, often under half of retail. Customers who connected earlier keep 1:1 retail credit through 2039-2040.
Is there a solar tax credit in Arkansas?
The 30% federal credit for homeowners ended for systems installed after 2025. Arkansas does not offer a state income tax credit for solar that we're aware of.
How do I check a solar installer's license in Arkansas?
Arkansas Contractors Licensing Board (residential/commercial contractor license as applicable) and a licensed electrician/master electrician via the Arkansas Board of Electrical Examiners (Dept. of Labor and Licensing).. Look up any installer with the state's license search at https://aclb.arkansas.gov/.
Policy research current as of October 2026; sources include uaex.uada.edu, pv-magazine-usa.com, apsc.arkansas.gov. Electricity data: EIA, through July 2026. Found something out of date? Tell us.