North Carolina rooftop solar installers lost their biggest federal tax credit overnight, watched installations collapse by two-thirds, and are now quietly posting record sales months nobody predicted
Image generated with artificial intelligenceNorth Carolina’s rooftop solar installers had every reason to brace for collapse. The 30% federal tax credit that made home panels affordable for millions of households was eliminated overnight. Installations in the state then fell by two-thirds in a single quarter. Throw in tariffs, stubbornly high interest rates, and shrinking bill credits from the grid, and veteran installer Stew Miller — who has been in the business since the 2000s — says there’s “a lot of negativity” right now.
And yet: some of these same companies are posting record sales months.
A market that should be struggling — but isn’t
The numbers tell a bleak story. Between Q4 2025 and Q1 2026, new rooftop solar installations in North Carolina dropped by two-thirds, according to estimates from the North Carolina Sustainable Energy Association. National solar companies largely pulled out of the state, shrinking the field of active installers. On paper, this looks like an industry in retreat.
At least half of her customers are now choosing leases — she calls it “the most cost-effective residential option I’ve seen yet in North Carolina.”
Talk to the companies still operating, though, and you hear something different. Local installers like NC Solar Now and Yes Solar Solutions say sales have rebounded after the initial freefall. Jesse Solomon, vice president and director of sales at NC Solar Now, is direct about it: “I would tell you if we were struggling. But we just had a record month.”
Why rooftop solar was already a tough sell in North Carolina
Even before the tax credit disappeared, North Carolina was never a rooftop solar powerhouse. The state has only about 58,000 home arrays serving a population of 11 million — roughly middle of the pack nationally.
Duke Energy is the main reason. The investor-owned utility covering most of the state has historically offered relatively low electricity rates, making grid power cheaper than self-generation for most households. State law also blocks any third party from selling electricity directly, removing the competitive pressure that has driven solar adoption elsewhere. Duke’s solar rebate program helped for a while, but it ended early, and the utility has since reduced what it pays grid-connected customers for excess electricity. Those factors kept rooftop solar a niche product — until the math started shifting.
The lease loophole that changed the math
A 2017 state law quietly planted the seed of the current recovery. Under that provision, third parties can lease solar equipment — not sell electricity — to customers in Duke territory, up to a certain cap. For years, almost nobody used it.
Then the federal tax credit structure changed things. When the One Big Beautiful Bill Act eliminated the 30% credit for homeowners, it preserved a parallel 30% commercial credit for businesses and third-party entities. Installers and lessors can now claim that commercial credit and pass the savings directly to residential customers through lease arrangements. Many households can go solar with little or no money down and start saving immediately. “Leasing is now alive and well,” said Clary Franko, chief operating officer of Asheville-based Sugar Hollow Solar. At least half of her customers are now choosing leases — she calls it “the most cost-effective residential option I’ve seen yet in North Carolina.”
Batteries and rising bills sweeten the deal
Two forces are pushing hesitant households toward yes. Duke Energy’s battery incentive programs — EnergyWise Home and Power Manager — pay homeowners roughly $50 per month in exchange for allowing the utility to tap their batteries up to 36 times per year. That monthly payment offsets costs and makes battery-paired solar systems significantly more attractive.
Electricity bills keep climbing, too. Residential rates in Duke territory have risen more than 20% over the past five years, with another potential 10% increase proposed. Higher bills shrink the payback period and sharpen the comparison between staying on the grid and going solar. The numbers can be striking: Bryce Bruncati of Raleigh-based 8MSolar recently helped a customer whose Duke bill had reached $420 a month. With a new solar array and two batteries on a lease with no down payment, that customer now pays $160 a month instead.
Clouds still on the horizon
The optimism is real, but it comes with caveats. Leasing arrangements depend on the current commercial tax credit, which is only guaranteed through the end of next year — if federal or state law changes, that option could disappear quickly.
Bill credits for solar households in Duke territory are also set to decrease again on January 1, 2027. Revised state electrical codes may add to installation costs in the near future. Industry leaders agree that restoring the 30% residential tax credit would be the single biggest boost to the market, though few expect that under current political conditions.
What comes next depends on how those variables land. If leasing stays viable and electricity rates keep rising, North Carolina’s rooftop installers may hold their ground. If the commercial credit expires without replacement, the recovery could stall just as quickly as it began. For now, the companies still standing are watching the policy calendar as closely as they watch the weather — and hoping the sun stays out a little longer.
Carlos is an engineer with strong expertise in technical and industrial topics. He previously worked at international companies such as Siemens and is multilingual.
