Summary of Iowa solar incentives 2021
The Iowa solar tax credit helps you install solar on your home. It provides some cash back in the first year, making your payback time-frame and return on investment a better than the national average. Pair that with the 26% Federal tax credit, and you've got a compelling investment case for home solar. Read on to learn all you need to know about incentives, policy, and savings for home solar power in Iowa.
On this page, you can:
-
Learn what solar incentives are available to Iowa homeowners
-
See what Iowa solar incentives you qualify for based on your utility company and city
-
Find out how much these incentives and/or Iowa solar tax credits will reduce your cost to go solar and add batteries
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 Iowa
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 Iowa
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 the surplus.
Iowa was one of the first states in the country to get on board with net metering, passing its first standard way back in 1984. The state's current net metering policy is pretty strong, though municipal and cooperative electric utilities are not covered.
MAE and AEIPL carry your surplus electricity you send back to them forward toward future bills, rather than actually giving you cash back. Regardless, savings are savings, and Iowa’s strong net metering policy helps make going solar here more sensible.
Iowa solar rebates
Iowa doesn't have any statewide rebates, but if you’re lucky enough to be served power by the Ames Electric Department, you can qualify for a rebate of $300 per kilowatt (kW), up to a maximum of $5,000. For example, if you install a 6-kW solar energy system, you can claim $1,800. Explore more information about the Ames solar rebate program by visiting the city’s website.
Iowa solar tax credit
Iowa offers a personal tax credit equal to 50% of the federal solar tax credit of 26%. So, for an average 6-kW solar energy system installed for $18,000, you are eligible for $4,680 from the Federal government (26% * $18,000), and an additional $2,340 (50% of the Federal credit).
Both amounts can be claimed on your yearly tax returns for after a solar installation was completed on your home. There’s a maximum credit of $5,000. Any excess credit (i.e., if your credit reduces your tax burden below $0) may be carried over for up to ten years, which is great news for Iowa homeowners interested in solar power.
New solar owners in Iowa must apply online by May 1st of the year after installation. Each year, the state has a $5 million cap for all tax credits, but timely applications will be put on a waiting list for the next year's limit. Once your application is approved, a tax credit certificate will be mailed to you. Read more about Iowa solar tax credits here, and apply here.
Tax exemptions
Your solar power system adds value to your home. A bunch of value – like, thousands, even tens of thousands of dollars of value. Normally all that added value comes with added taxes.
In Iowa, however, the increase in property value resulting from the installation of a solar power system is exempt from all associated property taxes for five full assessment years. That’s not the full (i.e. doesn't expire) exemption we’ve seen in a lot of other states, but it IS a nice chunk of change you won’t be responsible for paying.
Another chunk of change you won’t be responsible for paying is the 5-7 % sales tax (depending on where you live) attached to most other items. Yep, Iowa exempts your solar power system from this one too. Good show, Iowa!
Cost of solar panels in your part of Iowa after all applicable solar incentives
Showing data for:
Change
Prices based on a 10.9kW system, after 26% federal tax credit
Solar prices near you
Payback period
9.5-11.6 years
Net profit (savings less system cost)
$30,941-$37,817
Average size system installed in IA in 2021
10.9kW
Solar panel cost calculator
Best 10 solar companies in Iowa
11 solar companies in Iowa provide pricing on SolarReviews. Here are the best rated companies near you.
4.73 90 Reviews
Latest review
Casey Simpson, 6 days ago
worked with ECG to complete 2 separate solar panel installs at my home. Sales rep (Steve) was incredibly responsive, answered all my questions, changed the bid easily a dozen times to make it work into my financial goals, worked with multiple finance providers to get me the best deal for my requirements (monthly payments less than what I'm saving in electric.). Steve did an excellent job in producing a full incredibly detailed forecast report on solar production to expect, and monthly electric savings. Jason did a great job in looking at the construction layout of my perlin-frame garage to make the panels use the maximum amount of roof space available. Installers were incredibly fast, got the entire array installed and up and running within a week (3 days initial phase, then about 1.5 days for the additional array on the back). The solar arrays have been in operation for nearly 5 months now and so far my actual production is beating Steves projections by about 15-20%, so producing even more than what they forecast. He did say their projection tool was on the very conservative side so not to over promise actual results and so far that appears to be accurate. Very pleased with the whole process. Cant forget mentioning Paula in this whole process also, getting all the paperwork submitted, installation crews lined up, scheduling electric company for tie-in, permits, filling out the tax rebate paperwork. The whole group was a charm to work with, and my electric bill has gone from $700/month average to less than $50 the last 2 months.
Read more
Average cost (5kW system)
$15,750 ($3.15 per watt)
Latest review
Casey Simpson, 6 days ago
worked with ECG to complete 2 separate solar panel installs at my home. Sales rep (Steve) was incredibly responsive, answered all my questions, changed the bid easily a dozen times to make it work into my financial goals, worked with multiple finance providers to get me the best deal for my requirements (monthly payments less than what I'm saving in electric.). Steve did an excellent job in producing a full incredibly detailed forecast report on solar production to expect, and monthly electric savings. Jason did a great job in looking at the construction layout of my perlin-frame garage to make the panels use the maximum amount of roof space available. Installers were incredibly fast, got the entire array installed and up and running within a week (3 days initial phase, then about 1.5 days for the additional array on the back). The solar arrays have been in operation for nearly 5 months now and so far my actual production is beating Steves projections by about 15-20%, so producing even more than what they forecast. He did say their projection tool was on the very conservative side so not to over promise actual results and so far that appears to be accurate. Very pleased with the whole process. Cant forget mentioning Paula in this whole process also, getting all the paperwork submitted, installation crews lined up, scheduling electric company for tie-in, permits, filling out the tax rebate paperwork. The whole group was a charm to work with, and my electric bill has gone from $700/month average to less than $50 the last 2 months.
4.66 35 Reviews
Latest review
Eschbank Farms, over 1 month
We searched out many different companies before we made the decision to go with Atwood Electric, Inc. We made that decision based upon how straightforward and honest they were from the very beginning. We were always kept in the loop of what was going on. Once the project was complete they made sure that we were happy with it, and understood how it worked. When we had questions they were always more than happy to answer them throughout the whole process. They were very easy to work with.
Read more
Latest review
Eschbank Farms, over 1 month
We searched out many different companies before we made the decision to go with Atwood Electric, Inc. We made that decision based upon how straightforward and honest they were from the very beginning. We were always kept in the loop of what was going on. Once the project was complete they made sure that we were happy with it, and understood how it worked. When we had questions they were always more than happy to answer them throughout the whole process. They were very easy to work with.
4.56 12 Reviews
Latest review
Matt & Brenda Hald , over 1 month
veryone is so friendly and helpful. They took the time to listen to and answer my million questions. Everything in our home is electric except the stove; we also keep an RV plugged in to run the AC all summer. It only took one month to have a zero balance and credit on our electric bill! Thank you, Purelight!
Read more
Latest review
Matt & Brenda Hald , over 1 month
veryone is so friendly and helpful. They took the time to listen to and answer my million questions. Everything in our home is electric except the stove; we also keep an RV plugged in to run the AC all summer. It only took one month to have a zero balance and credit on our electric bill! Thank you, Purelight!
4.46 9 Reviews
Latest review
Ryan R, over 1 month
I had always found solar really interesting but didn't understand how to do it or the ROI. Olson Solar made it super easy and an extremely painless, fast process. If you're in WI, call these guys first. Reliable and efficient.
Read more
Latest review
Ryan R, over 1 month
I had always found solar really interesting but didn't understand how to do it or the ROI. Olson Solar made it super easy and an extremely painless, fast process. If you're in WI, call these guys first. Reliable and efficient.
4.38 41 Reviews
Latest review
Marc Wallace , 2 days ago
From the initial call through the build and with following up on the switch on, everyone has been good to work with and positive. They even sent a team to fill in a trench in the yard with soil and grass seed. Seeing the energy production on the app is gratifying too.
Read more
Latest review
Marc Wallace , 2 days ago
From the initial call through the build and with following up on the switch on, everyone has been good to work with and positive. They even sent a team to fill in a trench in the yard with soil and grass seed. Seeing the energy production on the app is gratifying too.
4.38 7 Reviews
Latest review
Anonymous, over 1 month
CB Solar looked at our location and assessed our electrical usage, then gave us information on what would work for our house. They did all the legwork necessary to comply with our local REC requirements. That gave us peace of mind to know it was all handled by their knowledgeable engineers. <br />Once they installed our solar panels, we had immediate results on our very next electric bill.<br />We are very happy with CB Solar's expertise and their continued interest to be sure our array is working for us.<br />And we are glad to be using a renewable energy source to help power our house.<br />Just wish we had a bigger roof so we could have had a few more panels!
Read more
Latest review
Anonymous, over 1 month
CB Solar looked at our location and assessed our electrical usage, then gave us information on what would work for our house. They did all the legwork necessary to comply with our local REC requirements. That gave us peace of mind to know it was all handled by their knowledgeable engineers. <br />Once they installed our solar panels, we had immediate results on our very next electric bill.<br />We are very happy with CB Solar's expertise and their continued interest to be sure our array is working for us.<br />And we are glad to be using a renewable energy source to help power our house.<br />Just wish we had a bigger roof so we could have had a few more panels!
4.17 4 Reviews
Latest review
Anonymous, over 1 month
I contracted with RJ Construction to install solar array equipment. I was very satisfied with the quality of work as well as the innovative ideas RJ came up with.
Read more
Latest review
Anonymous, over 1 month
I contracted with RJ Construction to install solar array equipment. I was very satisfied with the quality of work as well as the innovative ideas RJ came up with.
3.93 4 Reviews
Latest review
C Gotschall, over 1 month
I went with GRNE for our solar install last fall based on vetting done by Solarize Chicagoland. So glad I did! I couldn't recommend them more highly. Every person I've had contact with has been professional and extremely helpful every step of the way, very conscientious and patient with all my questions. The install went great and the panels have been up and running for months now, working like a dream. Thanks GRNE!
Read more
Latest review
C Gotschall, over 1 month
I went with GRNE for our solar install last fall based on vetting done by Solarize Chicagoland. So glad I did! I couldn't recommend them more highly. Every person I've had contact with has been professional and extremely helpful every step of the way, very conscientious and patient with all my questions. The install went great and the panels have been up and running for months now, working like a dream. Thanks GRNE!
3.85 5 Reviews
Latest review
David Wessel, 6 days ago
Chris did a good job , Told Us How solar works system work Step-by-step how the system works , He did a good job thank you Chris
Read more
Latest review
David Wessel, 6 days ago
Chris did a good job , Told Us How solar works system work Step-by-step how the system works , He did a good job thank you Chris
3.75 1 Reviews
Latest review
Anonymous, over 1 month
Haven't paid a penny in electricity cost since installing my Sun Rack Solar System last year. Very professional throughout the entire process and install looks great! Very Happy!
Read more
Latest review
Anonymous, over 1 month
Haven't paid a penny in electricity cost since installing my Sun Rack Solar System last year. Very professional throughout the entire process and install looks great! Very Happy!
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.
Catherine Lane
January 30, 2020
What the winner of the 2020 Iowa caucus could mean for the future of the solar industry
A review of how the Iowa Caucus works, its importance, and if the winner in Iowa gives insight into the future of solar.
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.
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.
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.