Is Electrification Worth It in Texas?

Texas is weird.

Your electricity comes from a deregulated market where rates swing wildly depending on which retail provider you picked. Summer cooling loads are brutal—100°F days from June through September. But heating? You might use your furnace 20 days a year. Natural gas is dirt cheap here thanks to the Permian Basin. So the standard heat pump pitch doesn't really apply.

Here's the move: If you live in a hot zone like Houston or San Antonio and your AC is dying, get a heat pump. You're buying AC anyway, and the heating is basically free. But if you're in the Panhandle with a working gas furnace? The economics get murky fast.

Updated December 2024Data from EIA, DSIRE, NREL
Heat Pump Payback
Not Recommended
With incentives
Annual Savings
$2,428
Full electrification
Available Incentives
$10,650
Federal + state + utility
CO₂ Reduction
12.1 tons
Per year

Texas Energy Costs

Electricity Rate
$0.132/kWh
Natural Gas Rate
$1.32/therm
Average Electric Bill
$155/month
Average Gas Bill
$52/month
Climate Zone
hot
Heating Degree Days
1,700
Cooling Degree Days
2,800

Visual ROI Analysis

Payback Period Comparison

Lower is better • Shortest payback = fastest return on investment

Annual Savings Comparison

Higher is better • More annual savings = greater long-term benefit

Cumulative Net Savings Over Time

Point where line crosses $0 = payback achieved • Steeper line = faster savings growth

Return on Investment by Upgrade

🌡️

Heat Pump HVAC

Upfront Cost$12,000 - $22,000
Total Incentives-$2,500
Net Cost$9,500 - $19,500
Annual Savings$9/yr
Payback PeriodNot Recommended
Lifetime ROI7%
CO₂ Reduction1.8 tons/yr
☀️

Solar Panels

Upfront Cost$15,000 - $30,000
Total Incentives-$4,500
Net Cost$10,500 - $21,000
Annual Savings$1,069/yr
Payback Period15.5 years
Lifetime ROI139%
CO₂ Reduction3.8 tons/yr
💧

Heat Pump Water Heater

Upfront Cost$2,500 - $4,500
Total Incentives-$2,350
Net Cost$150 - $2,150
Annual Savings$198/yr
Payback Period7.6 years
Lifetime ROI66%
CO₂ Reduction1.8 tons/yr

EV Charger + Electric Vehicle

Upfront Cost$800 - $2,500
Total Incentives-$1,300
Net Cost$-500 - $1,200
Annual Savings$1,152/yr
Payback Period0.4 years
Lifetime ROI1489%
CO₂ Reduction4.8 tons/yr

Full Electrification Package

Total Upfront Cost
$30,300 - $59,000
Total Incentives
-$10,650
Net Cost After Incentives
$19,650 - $48,350
Annual Energy Savings
$2,428/year
Lifetime Savings (18 years)
$43,712
Simple Payback
15.7 years
💡

Best ROI for Texas

Based on your state's energy costs and climate, EV Charger offers the best return on investment with an average payback of 0.4 years and an ROI of 1489%.

0.0 years slower than average compared to the national average.

Ready to electrify your Texas home?

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