* Cost data based on quotes for fully-installed solar panel systems submitted on our platform. Prices are shown after applying the 30% federal tax credit.
Kentucky may not offer a lot when it comes to solar incentives, but that shouldn’t deter you from switching to solar. Utility companies in the Bluegrass State still purchase excess energy produced by solar panels at a high enough rate that you can eliminate most of your monthly electricity bills.
Combine these utility programs with the 30% federal solar tax credit, and you have the potential to save a lot of money with a solar installation in Kentucky!
The average cost for an installed residential solar system in Kentucky is currently $9,836 after claiming the 30% federal solar tax credit. This is $2.34 per watt. However, there is some variance in solar prices in different parts of the state. The graph below shows the average cost of installed solar systems in your part of the state.
Showing data for:
Prices based on a 4.8kW system, after 30% federal tax credit
Solar panels have fallen in price by more than 80% in the last ten years. In 2022 they also remain subsidized by the 30% federal tax credit and the net metering law, making them an excellent investment. They offer a return well above the long term average return from both the share market and also property investment.
Another way to look at this question is the levelized amount you will pay for each kWh of power you will use over the next 25 years with and without solar panels. As you can see below the savings are significant.
(forecast avg Kentucky electric rates over the next 25 years)
The federal solar tax credit is Kentucky's most significant incentive to install solar panels for homes and businesses. From now until 2032, the federal solar tax credit lets you deduct 30% of the cost of your solar installation from your income taxes. That means a $20,000 solar installation will give you a tax credit of $6,000!
Kentucky law requires utilities to offer some form of solar buyback program - where the utility purchases excess solar energy generated by its customer’s solar panels. Rates for how much you are credited vary depending on the utility company.
Remember that utilities are not required to purchase excess solar energy for the full retail rate. Utilities like Kentucky Power, LG&E, and KU buy extra solar generation at a rate lower than they bill for electricity.
For example, Kentucky Power charges about $0.11 per kilowatt-hour of electricity you use from the grid. However, it only buys the extra solar energy you generate at $0.09 per kilowatt-hour. This rate may not be as high as the retail rate, but it’s still high enough to see significant returns on your solar investment.
Be sure to check your utility company’s website for more information on their rates for net metering.
(After tax credit)
(After tax credit)
You will save most money by buying your solar system rather than leasing it. Read more about the pros and cons of leasing vs buying solar.
Minimum of 25 years but generally 30 or more
Solar panels power your house when they can but your home uses the utility company for power at other times. In 2023 "solar systems with battery storage" are becoming more popular. These are known as hybrid systems.
A grid-tied system is the most common type of solar system. It has no solar battery for backup power and utilizes net metering to maximize savings. Solar panels are mounted on your roof then wired together, and the power generated flows into an inverter where direct current (DC) electricity is converted into alternating current (AC) electricity. This electricity is either used by your home or is exported to the utility grid.
In hybrid solar systems, rooftop solar panels are connected to both a solar battery and the electric grid. The solar electricity generated by your panels that your home does not use is stored in the battery instead of being sent to the grid, which reduces your reliance on the utility while also providing backup power when needed. Battery storage is still expensive but you may be able to reduce costs by using state incentives.
Off-grid solar systems are not connected to the grid at all, so all of your energy needs must be met by the sun. There is no utility to fall back on. The solar installation needs to power your home not only during the day, but after dark as well, so many solar panels and a large battery system are required. These systems are often expensive and don’t make sense for homes that have access to the grid.
Read more about types of home solar systems.
No, but cleaning them can improve power generation if they are dirty.
Given this environment, and the effect of import tariffs placed on solar panels by the Trump administration during 2018, it is hard to see that solar power system prices in Kentucky will fall during 2023.
Depending on the location, solar panels will generate different amounts of electricity.
A solar system that is installed on a south-facing 30-degree pitch roof Kentucky will generate 1,550kWh of peak DC (direct current) capacity per year per 1kW in Kentucky.
Enter your details into the solar panel calculator to see how your location, roof tilt, and roof direction impacts solar panel production.
The advantage of installing solar panels in Kentucky is the state-mandated net metering. Although most companies don’t buy back at the full retail rate, there is still potential for great savings through this law. Also, installing solar is $2.34 per watt in Kentucky, which is cheaper than in many other states.
The disadvantage of installing solar in Kentucky is that there is very little in the way of state and utility-based incentives. Plus, the net metering laws do not require utility companies to offer a full retail rate, meaning that their rates could be much lower, which leads to fewer savings.
Despite all this, having mandated net metering and a 30% federal tax credit are two excellent reasons to go solar!
This solar calculator requires you to input your address, utility company, your average monthly power spend - it tells you:
If you want to see all of the above but also see live pricing, the three best solar deals available in your city and get binding quotes from each of these solar companies then use this Kentucky solar panels calculator. This calculator requires you to also input your name and contact details because most of our 200+ installer partners will only authorize the sharing of their live solar pricing where we have validated that you are a real homeowner with a home in their service area. We respect the privacy of your data and only share your contact details with the solar companies you ask us to get binding quotes from.
Note: Please keep in mind that the best source of up-to-date information on incentives are the solar installers who specialize in your area.