Summary of Iowa solar incentives 2020
The Iowa solar tax credit helps you install solar on your home for 2020 and beyond. 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:
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Learn what solar incentives are available to Iowa homeowners
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See what Iowa solar incentives you qualify for based on your utility company and city
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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% in 2021. Unless new legislation is introduced in Washington D.C., this program will be gone in 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 6kW 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:
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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 2020
10.9kW
Solar panel cost calculator
Best 10 solar companies in Iowa
10 solar companies in Iowa provide pricing on SolarReviews. Here are the best rated companies near you.
4.72 89 Reviews
Latest review
Doran Williams, 3 weeks ago
We were referred by a friend that had an array built on their house roof. We had a ground array set and and are very happy with it. High quality equipment and professionally installed. The system is very well built and is working great so far. We just got set up and can monitor everything that is being produced.
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Average cost (5kW system)
$15,750 ($3.15 per watt)
Latest review
Doran Williams, 3 weeks ago
We were referred by a friend that had an array built on their house roof. We had a ground array set and and are very happy with it. High quality equipment and professionally installed. The system is very well built and is working great so far. We just got set up and can monitor everything that is being produced.
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.
4.38 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!
4.38 7 Reviews
Latest review
Randi, over 1 month
Working with Olson Solar Energy was amazing from the quote, through installation, and after install when submitting documentation for the energy rebates. They made it easy for me as the homeowner, which I really appreciate. I highly recommend them if you are looking into adding solar to your home.
Read more
Latest review
Randi, over 1 month
Working with Olson Solar Energy was amazing from the quote, through installation, and after install when submitting documentation for the energy rebates. They made it easy for me as the homeowner, which I really appreciate. I highly recommend them if you are looking into adding solar to your home.
4.32 25 Reviews
Latest review
JOHN, over 1 month
first, the office was local, second the response from the salesman and installation team was very cordial and helpful.
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Latest review
JOHN, over 1 month
first, the office was local, second the response from the salesman and installation team was very cordial and helpful.
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.
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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.
4.17 4 Reviews
Latest review
Body shop, over 1 month
I chose Solar Energy and had 2500kw system installed by them they are local and every dependable. I have had my system since 2013 and have had no problems what so ever. I have consulted with them several time with questions about my system and they always are very informant. I would highly recommend Solar Energy for you Solar needs.
Read more
Latest review
Body shop, over 1 month
I chose Solar Energy and had 2500kw system installed by them they are local and every dependable. I have had my system since 2013 and have had no problems what so ever. I have consulted with them several time with questions about my system and they always are very informant. I would highly recommend Solar Energy for you Solar needs.
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!
3.75 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!
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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!
3.36 11 Reviews
Latest review
Anonymous, over 1 month
T. M. screwed me out of a lot of money. He didn't pay the electrician. They didn't install the solar right and I had to hire a different solar company to come in and redo everything to get it up and running right. This man closed the doors to this business and opened up another solar company under the name of Solar Planet Group and then under LTD Solar. I understand that he is now operating under the name Solar Advisers.
Read more
Latest review
Anonymous, over 1 month
T. M. screwed me out of a lot of money. He didn't pay the electrician. They didn't install the solar right and I had to hire a different solar company to come in and redo everything to get it up and running right. This man closed the doors to this business and opened up another solar company under the name of Solar Planet Group and then under LTD Solar. I understand that he is now operating under the name Solar Advisers.
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