Oklahoma has excellent sunlight. The western half of the state receives as much annual sun as Arizona. The problem is that Oklahoma also has some of the lowest electricity rates in the country, no statewide net metering law, and no state-level solar incentives. The sun is there. The financial case is not, at least compared to neighboring states and the national average.
For an Oklahoma homeowner with a favorable utility and high self-consumption of solar generation, the payback period is 12 to 16 years with net savings of $6,000 to $14,000 over 25 years. For customers of utilities without voluntary net metering, solar may not reach breakeven within the panel warranty period. Here is the analysis.
What Solar Panels Cost in Oklahoma
Solar in Oklahoma costs approximately $2.60 to $2.90 per watt, which is below the national average. A typical 7-kilowatt system costs $18,000 to $20,500 before incentives. Installation costs are kept low by competitive labor rates and the relative simplicity of installations on standard suburban homes in the Oklahoma City and Tulsa metros.
| System Size | Installed Cost (Before Incentives) | After Federal Tax Credit |
| 5 kW | $13,000–$14,500 | $9,100–$10,200 |
| 7 kW | $18,200–$20,300 | $12,700–$14,200 |
| 10 kW | $26,000–$29,000 | $18,200–$20,300 |
The federal tax credit is the only significant financial incentive available to Oklahoma solar owners. There is no state-level tax credit, no state rebate program, and no solar renewable energy credit market. Oklahoma does offer a property tax exemption for solar systems, which prevents the added home value from increasing property tax assessments.
Oklahoma Has No Net Metering Law
This is the single most important fact about solar in Oklahoma. Unlike most states, Oklahoma does not require utilities to offer net metering. Each utility sets its own policy for compensating solar generation exported to the grid. Some offer net metering voluntarily. Some offer lower export rates. Some offer no compensation at all for exported electricity.
Oklahoma Gas and Electric, the largest utility serving the Oklahoma City metro, offers net metering on a voluntary basis. Excess generation is credited at the full retail rate and rolled over month to month. Oklahoma Gas and Electric has not announced plans to change this policy, but it is not required by law to maintain it. The policy could change through a rate case or a corporate decision without legislative action.
Public Service Company of Oklahoma, serving the Tulsa area, also offers voluntary net metering with terms similar to OG&E. Rural electric cooperatives, which serve much of the state outside the two major metros, set their own policies. Some offer net metering. Some offer lower export rates. Some offer no solar interconnection at all. Contact your specific cooperative or municipal utility to confirm their policy before getting solar quotes. The difference between a utility with full retail net metering and one with no export compensation is the difference between a solar investment that eventually pays for itself and one that never does.
How Much Power Oklahoma Solar Panels Generate
Oklahoma receives 5.0 to 5.5 peak sun hours per day averaged across the year. The western part of the state receives more sun than the eastern part. Oklahoma City receives approximately 5.3 hours. This is among the best solar resources in the country, comparable to Texas and the Southwest. A 7-kilowatt system in Oklahoma City generates approximately 11,500 to 13,000 kilowatt-hours per year.
Oklahoma’s solar resource is the one bright spot in an otherwise challenging economic environment. The panels produce a lot of electricity. The problem is that each kilowatt-hour is worth very little compared to states with higher electricity rates.
How Much You Save on Electricity
Oklahoma residential electricity rates average 10 to 11 cents per kilowatt-hour, which is among the lowest in the nation. Only a handful of states, including Louisiana and Washington, have consistently lower rates. Low rates are driven by abundant natural gas, which fuels most of Oklahoma’s electricity generation.
At 10.5 cents per kilowatt-hour, a 7-kilowatt system generating 12,000 kilowatt-hours per year saves approximately $1,260 per year in electricity under full retail net metering. Against a net system cost of $13,500 after the federal credit, the simple payback period is 10.7 years. For Oklahoma Gas and Electric and PSO customers with voluntary net metering, this is the expected outcome.
For customers of utilities without net metering, the savings depend on self-consumption. Without net metering, exported electricity may be credited at a lower rate or not credited at all. A home that self-consumes 40 percent of its generation saves approximately $500 per year from self-consumed electricity plus a smaller amount from export credits, if any. Total annual savings of $500 to $700 extend the payback to 19 to 27 years, which is near or beyond the panel warranty period.
Adding a battery to increase self-consumption to 80 percent improves the savings to approximately $1,000 per year from self-consumed electricity but adds $8,000 to $12,000 to the upfront cost. The battery payback alone is long, and it only partially compensates for the absence of net metering.
Severe Weather and Solar Panels in Oklahoma
Oklahoma experiences more tornadoes per square mile than any other state. Hail is common. Wind speeds during severe thunderstorms routinely exceed 70 miles per hour. Solar panels and mounting hardware are engineered for these conditions, but the risk is real and should be understood.
Solar panels are rated to withstand one-inch hailstones at 50 miles per hour. Oklahoma hail frequently exceeds this. Panels can and do crack from large hail, although the tempered glass used in solar panels is significantly more impact-resistant than standard window glass. Hail damage is typically covered by homeowners insurance as part of dwelling coverage. Confirm with your agent that your solar system is covered and increase your dwelling coverage limit to reflect the system’s value.
Racking systems for Oklahoma installations should be rated for high wind loads. The Oklahoma Uniform Building Code specifies wind speeds for each county. Coastal and tornado-prone areas require higher-rated mounting hardware. An experienced Oklahoma installer uses racking rated for the local wind zone as standard practice. Confirm this with your installer before signing.
25-Year Financial Picture
Over 25 years, an Oklahoma Gas and Electric or PSO customer with a 7-kilowatt system can expect net savings of $10,000 to $18,000 after recovering the initial investment. This assumes continued voluntary net metering. If net metering is reduced or eliminated mid-way through the system’s life, the savings are lower. A cooperative or municipal utility customer without net metering can expect net savings of $0 to $8,000 depending on self-consumption rates.
Oklahoma’s excellent solar resource is neutralized by its low electricity rates and weak policy environment. The state that should be a solar leader based on sunlight alone is a laggard based on economics. The panels produce plenty of power. The power is not worth enough to justify the investment for many homeowners.
Cash vs. Loan vs. Lease
Cash purchase produces the highest return for the limited return that exists. A solar loan adds interest cost to an already long payback, making cash the preferred option when possible. Leasing is generally not recommended in Oklahoma because the returns are already marginal and the third-party owner captures the federal tax credit.
When Solar Is Probably Not Worth It in Oklahoma
Cooperative or municipal utility without net metering. Without full retail net metering, solar economics in a low-rate state deteriorate to the point of not being viable. Confirm your utility’s policy first.
Moving within 10 years. The payback period even under favorable conditions exceeds a decade.
High wind or hail exposure without adequate insurance. Oklahoma’s severe weather risk is real. Confirm your insurance coverage before committing.
Old roof. Oklahoma roofs take abuse from hail, wind, and temperature extremes. Replace before installing solar.
OG&E or PSO changes its net metering policy. Since net metering is voluntary, the policy could change before or after your installation. This is a risk that does not exist in states with statutory net metering requirements.
Frequently Asked Questions
Will solar panels survive an Oklahoma tornado?
A direct hit from an EF3 or stronger tornado will destroy solar panels along with the roof and the rest of the house. There is no practical tornado-proofing for rooftop solar. Homeowners insurance covers the panels as part of the dwelling in the event of tornado damage. The more relevant question is whether the mounting hardware will survive the non-tornado high winds that occur far more frequently. Properly installed racking rated for Oklahoma wind zones will withstand winds of 90 to 110 miles per hour, which covers the vast majority of severe thunderstorms.
Is OG&E likely to change its net metering policy?
OG&E has not announced plans to change its voluntary net metering policy, but it is not required by law to maintain it. The policy could change through a rate case at the Oklahoma Corporation Commission. Rate cases occur every few years and are public processes. Oklahoma solar advocacy groups track these proceedings. If you are considering solar, installing sooner rather than later locks in the current policy terms. There is no guarantee that net metering will be available to new installations in the future.
How does Oklahoma solar compare to Texas?
Texas has similar sunlight and similar installation costs. The key difference is that Texas has a competitive retail electricity market where homeowners can choose plans with solar buyback rates that are significantly better than Oklahoma’s default rates. A Texas homeowner in a competitive area can find a plan that pays 10 to 15 cents per kilowatt-hour for exported solar, while an Oklahoma homeowner with a non-netting cooperative may get nothing. The policy environment, not the sun, creates the difference. Oklahoma panels produce the same amount of electricity. Texas panels generate more revenue from it.
