Idaho solar rebates and tax credits calculator

Summary of Idaho solar incentives 2021

The Idaho Public Service Commission UNANIMOUSLY rejected Idaho Power’s late-2019 attempts to destroy net metering, whew! However, on December 20, 2020, the PUC also declined to allow customers with new solar installations to receive the old compensation rates for their excess solar energy. If you install solar in Idaho now, you may end up getting lower bill credits for energy your solar installation makes that you don't use yourself. 

We're expecting to see the PUC come to a decision about net metering sometime in 2021, and we'll update this page at that time. Read on to learn all you need to know about going solar in Idaho - solar panel policy, incentives, and savings!

Federal solar investment tax credit

The federal solar investment tax credit will have the biggest impact on the cost you will face to go solar in Idaho

This perk is commonly known as the ITC, short for “Investment Tax Credit”. If you install your photovoltaic system in 2020, the federal tax credit is 26% of the cost of your solar panel system. This is 26% off the entire cost of the system including equipment, labor and permitting.

Example: If your solar energy system costs $20,000, your federal solar tax credit would be $20,000 x 26% = $5,200.

The federal tax credit falls to 22% at the end of 2022.

Net energy metering in Idaho

With net metering in some states, you get full retail rate credit for the amount of electricity you send back into the grid with your solar panels.

Net Metering requires your utility to monitor how much energy your solar power system produces and how much energy you actually consume, and make sure you get credit for any surplus. It’s an essential part of strong solar policy, because it’s a big money saver for you. Idaho currently has no law requiring utilities to offer net metering, or governing interconnection (getting on the grid to get net-metered), and again, people who install solar panels on their homes now will not be eligible for long-term net metering under the state's pre-2020 rules.

For now, all three of the state’s three investor-owned utilities — Avista Utilities, Idaho Power and Rocky Mountain Power — have independently decided to offer net metering programs until the PUC comes to a decision. The framework of all three programs is similar. All of the programs limit individual system size, but those limits won't affect homeowners much.

All three programs also handle residential net metering the same way: all surplus energy produced is applied as a credit to your next month’s bill at the full retail rate. So for every kW extra you produce one month, you pay for one less kW the next. Avista specifies (sadly) that surplus credit reverts back to the utility without compensation after 12 months. Idaho Power and Rocky Mountain Power do not specifically address “rollover” limits or other annual surplus accounting policies.

Idaho Power and Rocky Mountain Power have been in communication with the state public utilities commission on a plea to pay much less than retail rates in the future, though the PUC has denied to hear their requests for the near term. As it stands, now may be a good time to lock in your net metering by going solar so the rates don’t diminish.

Idaho solar rebates

The state of Idaho doesn't offer any cash rebates for going solar, or really much of any other kind of incentive, either. We'd like to see the state get into helping homeowners go solar, but honestly, we're not holding our breath. Most folks in Idaho prefer the government to stand aside, and that's going to have to do.

There is one smart incentive for Idaho homeowners who go solar, and it's going to lower your taxes. Very on-brand, Idaho.

State tax deduction

Instead of a more straightforward tax credit for installing solar, Idaho decided to enact a 100% tax deduction. So, when you go solar, you can take 40% of your installation cost as a deduction in the first year, up to a maximum of $5,000. Then, for the next 3 years, you can deduct 20% of the cost each year from your state income for tax purposes.

For example, an average sized 6kW system installed for $18,000, you can deduct $7,200 from your state income for reporting purposes in the first year, and $3,600 for the next three years.

At current Idaho personal income tax rates, you can expect this deduction to be worth about $1,100 total over the four year period.

Useful links

Related solar news

Ben Zientara

January 26, 2021

The state of net metering in the United States in 2021

This annual report ranks the states for friendliness to home solar based on their net metering programs.

Net metering

Ben Zientara

February 26, 2021

Q CELLS solar panels (Hanwha) - 2021 review

A complete review of Q CELLS solar panels, including their efficiency, warranty, and cost. If you’ve gotten a solar quote featuring Q CELLS, learn more about them here.

Solar panels

Ana Almerini

February 24, 2021

Declining fossil fuel jobs makes way for renewable energy careers

Fossil fuel jobs will be lost as we transition to a clean economy, but there are jobs to be gained by workers with transferable skills.

Solar power

Ana Almerini

February 24, 2021

2021 review: the Panasonic EverVolt battery and solar modules

Panasonic has released EverVolt solar panel modules that will work in conjunction with the EverVolt battery. Pair them together for energy independence.

Solar batteries

Dan Hahn

February 20, 2021

The best solar stocks to watch over the next decade

Learn about some of the more interesting publicly-traded companies in the solar energy and energy storage industries in 2021 and beyond.

Solar power

< >

1 of 1