Ohio is the rare 2026 state where the headline news is good: on January 7, 2026, the Public Utilities Commission of Ohio (PUCO) rejected an AEP Ohio proposal to gut residential net metering and kept the existing rules in place under its 5-year review (Docket 25-0349-EL-ORD). Net metering survives in Ohio for at least another rate cycle.
But the how of Ohio's net metering trips up most coverage. The export credit is not full retail, and it is not avoided cost — it's a third thing: the energy-only component of the utility's Standard Service Offer (SSO) generation rate, under OAC 4901:1-10-28(B)(9). That works out to roughly $0.06/kWh on AEP Ohio, Duke Energy Ohio, and FirstEnergy / Cleveland Illuminating (varies with each utility's SSO auction). Self-consumed solar still offsets the full retail rate (about $0.16/kWh and rising).
Most Ohio solar guides get this wrong in one of two directions:
- YellowLite and similar still call Ohio "full retail net metering" — overstating the value of every kWh you export.
- greenenergycalc cites about $0.038/kWh "avoided cost" — understating it; the SSO energy component is generally higher than avoided cost.
The correct number is the energy-only SSO generation rate — modeled here at $0.06 — and it's the most important fact for sizing an Ohio system.
The headline economics:
- Retail about $0.16/kWh and rising (about 26% since 2021, driven by data-center demand).
- Export about $0.06/kWh (energy-only SSO under OAC 4901:1-10-28(B)(9)).
- 120% of annual consumption cap, ≤25 kW residential.
- No federal credit (§25D repealed, OBBBA P.L. 119-21).
- No state income tax credit.
- SREC market exists but pays only about $30-100/year — essentially symbolic.
- Sales tax NOT EXEMPT (about $1,000-1,140 added to a typical install).
- Property tax exemption DISPUTED — verify locally.
Solar-only payback at default install pricing comes out to roughly 12-14 years on a typical Ohio system. Not the best, not the worst — a middle-tier state where self-consumption math drives the case.
What changed federally — and what's still on Ohio quotes that shouldn't be
The federal Residential Clean Energy Credit (§25D) — the 30% homeowner credit — was repealed for systems installed after December 31, 2025. For 2026 Ohio buyers, the federal credit on a purchased system is $0. The same applies to home batteries purchased outright. The §48E commercial credit (30%) still exists, but only for leased or third-party-owned systems where construction begins before July 4, 2026 — and the lessor claims it, not you. Full federal context here.
The repeal came through the One Big Beautiful Bill Act (P.L. 119-21), signed in July 2025. Many Ohio solar marketing sites (SmartEnergyUSA among others) still quote the 30% credit as live; Palmetto notes the change but some pages have not been updated. If a 2026 Ohio quote includes "30% federal solar tax credit" on a purchase, ask the contractor to redo the math with $0 federal and verify with IRS.
VERIFIED 2026-06 · IRS §25D repeal under OBBBA P.L. 119-21Net metering is alive — but it is NOT full retail
This is the single most-misreported fact about Ohio solar in 2026. The PUCO did keep net metering. The mechanism, though, has always been split between self-consumption and export — and the export rate is meaningfully below retail.
Under OAC 4901:1-10-28(B)(9):
- Self-consumed solar offsets the full retail rate (about $0.16/kWh on Ohio residential). When your panels make a kWh you use directly, you don't buy that kWh from the utility — full retail of value avoided.
- Exported solar is credited at the energy-only component of the utility's Standard Service Offer (SSO) generation rate — typically about $0.05-0.07/kWh (modeled here at $0.06). This EXCLUDES distribution and transmission charges. The exact number depends on each utility's most recent SSO auction.
- Credits roll over indefinitely as dollar-credits on your account, but they are not cashed out at retail and can be forfeited when you close the account.
- System size cap: 25 kW residential.
- 120% of annual consumption cap — don't oversize beyond this.
What this means in practice: a kWh you self-consume is worth roughly 2.5x a kWh you export. Sizing is a self-consumption optimization problem, not an export maximization problem.
On the PUCO decision specifically: AEP Ohio in 2025 proposed replacing net metering with a worse net-billing tariff. PUCO declined in the Docket 25-0349-EL-ORD ruling on January 7, 2026, and kept current rules under the 5-year review. That doesn't mean Ohio net metering is locked forever — the next review cycle is the next risk point.
VERIFIED 2026-06 · OAC 4901:1-10-28(B)(9); PUCO Docket 25-0349-EL-ORDDeregulated retail — the CRES nuance
Ohio has a deregulated residential electricity retail market, like Texas. You can choose a Competitive Retail Electric Service (CRES) provider instead of your utility's Standard Service Offer. Most Ohio solar pages skip this point; it matters.
- Net metering as defined under OAC 4901:1-10-28(B)(9) applies to SSO customers of AEP Ohio, Duke Energy Ohio, FirstEnergy / Cleveland Illuminating, AES Ohio, and the other Ohio investor-owned utilities.
- CRES providers MAY offer their own net-metering-equivalent terms under OAC 4901:1-10-28(2), which allows them to credit excess generation "at any rate." Those terms are contract-specific, may be better or worse than the SSO default, and need to be checked individually.
- This calculator defaults to the SSO case because that's the rule for the majority of Ohio residential customers. If you're on a CRES contract, your export economics may differ — check your CRES contract before you sign for solar.
The implication: if you've moved off SSO to a CRES provider for cheaper supply, your solar net-metering math is whatever your CRES contract says — not what this page shows.
The honest payback — solid middle tier
At default install pricing of $2.85/W (range $2.50-3.50; EnergySage reported $2.72/W in June 2026), our model puts typical Ohio solar-only payback in the 12-14 year range on a representative residential system, without the federal credit. Rising retail rates (about 26% since 2021) gradually improve year-over-year economics — but the export side stays weak.
Ohio sits in the middle of our verified set:
- Massachusetts (about $0.30/kWh retail + SMART): high single digits.
- Connecticut (about $0.29/kWh + Netting Tariff minus SEA): about 8-10 years.
- New Jersey (about $0.26/kWh + SuSI): about 6.5 years.
- Ohio (about $0.16/kWh + energy-only SSO export): about 12-14 years.
- Louisiana (about $0.12/kWh + avoided-cost export): about 21-23 years.
Self-consumption is what drives the math in Ohio. Right-size to your annual usage (well under the 120% cap), front-load daytime loads where you can, and don't lean on export.
VERIFIED 2026-06 · eia.govSales tax — NOT EXEMPT
Ohio does not exempt residential solar from sales tax. EnergySage confirmed this directly with the Ohio Department of Taxation — contrary to multiple sources (EcoWatch among others) that list Ohio as a sales-tax-exempt solar state. Those sources are outdated or wrong.
Ohio's combined sales tax runs about 7-8% (5.75% state plus local rates of roughly 1-2.25%). On a typical $14,250 residential system this is about $1,000-1,140 of real added cost the installer must include. Your quote SHOULD include sales tax. If you see an Ohio solar quote that excludes it, ask the installer to add it — pretending it doesn't apply misrepresents your true install cost.
Same flag pattern as Pennsylvania, Maine, and Louisiana — all confirmed not-exempt.
VERIFIED 2026-06 · Ohio Department of Taxation (EnergySage confirmation)Property tax — DISPUTED, verify locally
This is the second area where Ohio solar coverage diverges sharply. Don't budget for a property tax exemption you may not get.
ORC 5727.76 is cited by some sources (Palmetto, Ohio Solar Authority) as a statewide exemption for solar systems ≤250 kW. Other sources (Today's Homeowner, SolarIQ) read the same statute and say there is NO automatic statewide residential property tax exemption — the benefit comes through local abatement programs only.
The local abatements that DO exist and are well-documented:
- Cincinnati Residential Tax Abatement — 15 years, covers solar improvements as part of qualifying residential upgrades.
- Cleveland Residential Tax Abatement — 100% of added home value, fully covers the solar-driven uplift.
- Hamilton County HIP — local-level abatement.
This calculator does NOT assume a property tax exemption (conservative). Verify with your county assessor or local tax department. If you're in Cincinnati or Cleveland, the local abatement does materially help. Elsewhere in Ohio, treat the statewide exemption as unverified until your county confirms.
SREC market exists — but it's nearly worthless
Ohio's Alternative Energy Portfolio Standard (ORC 4928.64, "AEPS") creates an SREC market with a residential solar carve-out. The target is 8.5% renewable generation by 2026 — and Ohio is on track, so there's no compliance pressure pushing SREC prices up.
The result: Ohio SRECs trade at about $3-9 each (per MWh of generation). On a typical 7-10 kW residential system, that's roughly $30-100/year in SREC revenue. Real but small.
Do not confuse this with the live, materially valuable SREC markets in:
- PA: about $45/SREC.
- MD: about $60/SREC.
- NJ: $200-280/SREC on legacy programs.
- VA: live.
Ohio's SREC is essentially symbolic and is not modeled in this calculator's payback. If you want to register your system for AEPS, do — but don't put it in your purchase decision math.
Battery — split-rate arbitrage exists, doesn't pay back
The retail-vs-export gap in Ohio is about $0.10/kWh ($0.16 retail self-consumption minus $0.06 export SSO). That's a real arbitrage opportunity — bigger than IL or AZ (about $0.07/0.06), comparable to MI DTE (about $0.087), but far less than HI (about $0.25) or California NEM 3.0 (about $0.26).
So Ohio falls in the middle: battery has some arbitrage value, but on the default 10 kWh battery at $12,000 capex with $0 federal credit (§25D repealed for storage) and $0 state rebate (no Ohio statewide battery program), the math doesn't carry on arbitrage alone. The arbitrage delivers roughly $81/year of additional savings on a representative system — far below what's needed to amortize $12,000.
Our model with default settings shows:
- Solar-only 25-year net: about +$12,890 (positive, payback about 12-14 years).
- Solar + battery 25-year net: about +$3,666 (still positive, but the battery's capex eats most of the solar gain).
- Battery is a negative ROI add-on at current capex and zero subsidy — even though the arbitrage gap is real.
The honest read: install a battery in Ohio for backup / resilience (winter storms, summer storms, derecho events), not for ROI. The dollar payback math says no; the resilience math is a personal-tolerance question. Federal battery credit $0. No state battery rebate.
How to read this — Ohio's case for solar
Ohio solar works on self-consumption, not on export. The economics follow.
- Right-size to your annual usage — well under the 120% cap. Oversizing means exporting at $0.06 instead of consuming at $0.16. Bad trade.
- Load-shift toward daylight. Dishwasher, laundry, pool pump, EV charging during solar production hours. Every kWh shifted from grid-purchased (about $0.16) to self-consumed is worth full retail.
- Don't lean on export. Energy-only SSO at about $0.06 is roughly 2.5x worse per kWh than self-consumption.
- Rising retail helps you. Ohio residential rates rose about 26% from 2021 to 2024 (data center demand) and are still climbing. Long-term self-consumption savings improve as retail rises.
- Don't put SREC in your payback math. Ohio AEPS pays about $30-100/year — register, but don't count on it.
- Verify property tax locally. If you're in Cincinnati or Cleveland, the local abatement is real. Elsewhere, don't bake in a statewide exemption.
- Add sales tax to your quote if it's missing. Roughly $1,000-1,140 on a typical install.
- Reject any quote citing the federal 30% credit on a 2026 purchase. Dead.
- If you're on a CRES contract, read your contract — the SSO net-metering math on this page does not apply to you by default.
If your household runs a normal residential load and you can self-consume most of what you generate, Ohio solar is a respectable middle-tier case in 2026. If you were counting on the federal credit, on a generous SREC market, or on a full-retail export rate, none of those apply.
Run your real Ohio payback →The honest picture
| Fact | Ohio (SSO default — AEP / Duke / FirstEnergy) | Source |
|---|---|---|
| Federal credit | $0 (purchase) | IRS — §25D repealed under OBBBA P.L. 119-21 |
| State income tax credit | None | (no statute) |
| Net metering status | ALIVE — PUCO kept rules Jan 7, 2026 | PUCO Docket 25-0349-EL-ORD |
| Export rate | Energy-only SSO about $0.06/kWh (NOT full retail, NOT avoided cost) | OAC 4901:1-10-28(B)(9) |
| Self-consumed | Full retail offset (about $0.16/kWh) | (mechanical) |
| Residential cap | 120% of annual consumption, ≤25 kW | PUCO |
| CRES nuance | CRES providers may offer different terms | OAC 4901:1-10-28(2) |
| Retail rate | About $0.16/kWh, rising about 26% since 2021 | eia.gov |
| Sales tax | NOT EXEMPT (about 7-8% combined, adds about $1,000-1,140 on typical install) | Ohio Dept of Taxation (EnergySage confirmation) |
| Property tax | DISPUTED — no assumed exemption; local abatement in Cincinnati/Cleveland | ORC 5727.76 (disputed); verify county |
| SREC | Exists but about $30-100/year only — not modeled | ORC 4928.64 (AEPS) |
| AEPS target | 8.5% renewable by 2026 (on track) | ORC 4928.64 |
| Typical solar-only payback | About 12-14 years | This calculator (post-§25D, sales-not-exempt) |
| With battery (no state rebate) | Battery is negative ROI add-on; for resilience only | This calculator |
Before you commit:
- Reject any quote that includes a 30% federal credit. Repealed for 2026 purchases.
- Don't accept "full retail net metering" as a description of Ohio's mechanism. Self is full retail; export is energy-only SSO (about $0.06).
- Don't accept "avoided cost about $0.038" as the export rate either. SSO energy component is generally higher.
- Confirm sales tax IS in your installed quote. Ohio doesn't exempt — about $1,000-1,140 of real cost.
- Verify property tax locally. Don't bake in a statewide exemption; check your county. Cincinnati and Cleveland have confirmed local abatements.
- Don't put SREC in your payback math. Ohio AEPS is symbolic at about $30-100/year.
- Don't oversize past 120% of annual consumption. Export is too weak.
- CRES customers — check your contract. SSO net-metering rules don't necessarily apply.
- Battery is a resilience purchase, not an ROI purchase in Ohio in 2026.
Estimates only — SSO export rates change with each utility's auction, ORC 5727.76 property tax application is disputed and verified by county, AEPS SREC pricing varies year-to-year. Verify with PUCO, your utility (AEP Ohio, Duke Energy Ohio, FirstEnergy / Cleveland Illuminating, AES Ohio, or others), the Ohio Department of Taxation, and your county assessor. This is not financial advice.