Residents in Montgomery County, TN who request quotes on the EnergySage Marketplace spend an average of $183 monthly on electricity. That adds up to $2,196 per year. A different way to look at it is that a typical Montgomery County, TN resident uses 1,457 kWh of electricity per month and 17,484 kWh over the year.
(For what it’s worth: Montgomery County, TN residents shopping for solar on EnergySage may use more electricity than a typical household.)
The easiest way to compare electricity costs across regions is to look at the electricity rate. In the U.S., residential rates generally range from 11 ¢/kWh all the way up to 34 ¢/kWh.
As of February 2026, the cost of electricity in Montgomery County, TN is 13 ¢/kilowatt-hour (kWh)—roughly 37% lower than the national average cost. That number is based on real-world electric bills shared with EnergySage over the past 12 months. You can compare that number to the most recent average state electric price reported by the U.S. Energy Information Administration (EIA).
Tennessee’s electricity market is regulated, so you can’t choose which company supplies your electricity. Instead, the state determines your electric utility company based on where you live. Nearly all of the utility companies in Tennessee are part of the Tennessee Valley Authority (TVA), a federally owned electric utility corporation.
While the TVA covers much of the state, some towns and cities are served by municipally-owned, not-for-profit electric companies.
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When you pay your electric bill, you’re not only covering the costs to produce that electricity, but also the costs of running and maintaining the electrical grid, as well as public benefit funds that promote things like renewable energy and energy efficiency.
Electric bill costs are rolled into fixed (monthly customer charges) and variable charges (¢/kWh that you use).
Fixed charges, like the flat fee for having a meter, generally remain the same monthly unless your utility makes a policy update.
Your variable charges will change every month and depend on your electricity rate and how much electricity you use.
Your electric bill's variable charges will include a supply (or generation) charge and a transmission and distribution (or delivery) charge. The supply charge covers the cost of electricity generation, while the transmission and distribution charges cover the cost of delivering it to your home.
In Tennessee, most residents can sign up for variable-rate plans, typically time-of-use (TOU) rates or demand charge plans, which can help further reduce your monthly electric bill when used in conjunction with a solar or solar-plus-storage system.
How clean is the electricity in Tennessee?
Due to the complex nature of utility grids, it's not easy to pin down exact data regarding exactly where the energy that goes to your specific home comes from, but according to the U.S. Energy Information Administration, about 44% of the electricity on Tennessee’s utility grid comes from fossil fuels—primarily natural gas and coal—as of August 2025.
Only about 12% comes from renewable sources. Given that nearly half of the grid’s energy comes from fossil fuels, installing a home solar panel system in Tennessee will almost always shrink your carbon footprint.
TVA also offers the option to pay a bit more, allowing you to source most (or even all) of your electricity from renewable sources through the Green Switch program. If you’re unwilling or unable to go solar in Tennessee but still want to reduce your carbon footprint, this is a great alternative. It just won’t save you any money in most cases.
As long as you have a suitable roof, one of the surest ways to save on energy is to go solar—ideally with a vetted contractor offering a competitive price.
Solar panels will reduce or even eliminate your electric bills in the short term and protect you against rising electricity costs in the long run, too. The amount you save depends on how much you spend on electricity now and how much of your electric bill you can offset with solar energy.
Solar panels are a big investment, but Montgomery County, TN homeowners who install them—and pay upfront—break even after an average of just 13.25 years. Then, the solar panels will continue to produce free electricity for years to come.
Does Tennessee offer net metering?
On sunny days, your solar panels typically produce more than enough energy to fulfill your home's needs at any given moment.
That extra energy doesn't have to go to waste. While TVA utility companies don’t offer net metering, you may be able to participate in the Dispersed Power Production Program, a net billing program that lets you "sell" your extra energy to your utility company.
Compared to net metering, net billing gives you lower compensation rates. In Tennessee, you’ll typically save more money by installing a solar battery.
How much can you save with solar?
Rising electricity prices mean that you can often save when you go solar in Montgomery County, TN.
Just take a look at how much you'll spend on electricity over time based on your current bill. It’s easy to see how going solar can pay off quickly.
Electricity cost over time in Tennessee
Current monthly electric bill | 10-year electricity cost | 20-year electricity cost | 30-year electricity cost |
|---|---|---|---|
$50 | $6,500 | $14,000 | $24,000 |
$100 | $13,000 | $29,000 | $48,000 |
$150 | $20,000 | $43,000 | $72,000 |
$200 | $26,000 | $58,000 | $96,000 |
$250 | $33,000 | $72,000 | $120,000 |
Assuming a 2% annual increase based on inflation and average annual electric rate increases in Tennessee.
Let's assume you pay $183 for electricity monthly (the Montgomery County, TN average) and that electricity prices increase by 2% annually. Let's also assume you buy your solar panel system upfront and that it costs you $43,000 before any available incentives.
In the first year with solar, you'll avoid spending $2,200 on electric bills. Over five years, you'll avoid $11,400; by 10 years, you'll have avoided $23,900. Solar panels are usually covered under warranty for 25 years—by then, you'll have avoided spending $69,300 on electric bills in Montgomery County, TN.
The average payback period in Montgomery County, TN is 13.25 years, so by this point, you've already broken even on your investment. When you subtract your upfront installation cost, you'll pocket $26,500 over 25 years with solar.
Your solar savings depend on you
How much your utility company charges for electricity is a big indicator of how much you'll save with solar. But your exact solar savings depend on your unique situation—including your energy usage, roof layout, system size, and how you pay for your system.
Here are some reasons your savings could be below average:
You don’t use much electricity, or your roof is small or has a less-than-ideal layout. You might have a relatively long payback period, so you'll save a little less over time.
You don't install enough solar panels to 100% offset your energy use. You’ll pay less up front but save less in the long run.
You finance your solar panel system with a loan or sign a lease or power purchase agreement (PPA) instead of paying up front. These types of arrangements can make a lot of sense for keeping your capital flexible and will allow you to start saving sooner. But they will cut into your long-term savings.
Choosing a high-quality solar installer is the key to getting a top-notch solar panel system that will help you save on electric bills.
We pre-screen all solar companies on EnergySage to ensure they get the job done right. Here are the highest-rated EnergySage installers in Montgomery County, TN:
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