Kentucky Solar Information
-
#31Kentucky ranks #31 in the USA for savings from installing solar panels
-
5721.46 kWhAnnual AC energy output of a 4 kW solar system installed in Kentucky
-
4.93 kWhSolar Radiation (kWh / m2 / day)
-
11 ¢ /kWhThe cost of electricity today in Inter County Energy Coop
-
24 ¢ /kWhIf you don't go solar. The forecast average utility price over the next 25 years
Kentucky Solar Facts
-
$1.56Average cost of a 4kw solar power system in 2019.
-
5 yearsAverage system payback period.
-
$49,796.75Average lifetime savings.
-
5 ¢ /kWhLevelized cost of solar energy.
-
5 kWRecommended system size.
The Bluegrass State of Kentucky has a perfect location at the midpoint between the north and south of the country where temperatures don’t get too high in the summer or too cold in the winter. This helps Kentucky to get a lot of sunlight throughout the year, and all that sunlight represents potential savings if you go solar. Today the state uses mostly coal for its energy needs, but all the factors are in place for solar power to propel the state’s coal regions into a cleaner and more sustainable future.
Kentucky Solar Facts
- BThe average payback period for solar panels in Kentucky is 5,7 - 7 years.
- More than $19,000 can be saved over the 25 years of a solar system’s lifespan.
- Kentucky residents receive 4-5 peak sun-hours per day on average.
- Kentucky solar panels are eligible for a federal tax credit of 26%.
- Solar Power System Cost in Kentucky
-
$1.56 per watt
-
$6,874.06 total
-
5 years
The Cost of Solar Panels in Kentucky
As of November 2020, the average cost of a solar panel installation in Kentucky is around $2.34 per watt which is lower than the average price across the US. The total cost of a 6kW solar system will not exceed $10,398 after claiming the 26% federal solar tax credit.
Kentucky Solar Rebates and Tax Credits
Federal solar investment tax credit (ITC) – a governmental perk that allows all solar panel buyers to get 26% deduction of the installing cost from federal taxes. For example, if your solar system costs $15,000, your tax credit would be $3,900. Deduction will be lowered by 5.0% in 2021 and will be gone the year after unless new legislation is introduced.
Kentucky Solar Incentives
Kentucky Net energy metering (NEM) – this incentive allows solar users to send the surplus of produced power back to the grid in exchange for credits. When your solar panels produce more electricity than you need, your excess electricity will be sent to your utility company’s electric grid. Before 2020, NEM was one of the state’s best incentives that allowed solar buyers to get full retail credits for the excess amount of electricity they produced. However, starting this year the rate was lowered but remains yet to be fixed. The estimated amount of credit is expected to be 55% of the full retail credit. In other words, for 1 kWh you send back to your utility’s grid, you will be credited $.068 instead of the full retail rate of $0.124.
Tennessee Valley Authority utility (TVA) feed-in tariff – similar to the Net Metering Program, the TVA program offers a $1000 rebate for going solar and a feed-in tariff which is equivalent to the retail electricity price plus an additional $0.02/kWh. However, program benefits are available only for those who live in an area served by the TVA company.
Pros and Cons of Buying Solar Panels in Kentucky
Pros of Solar panels
-
Environmentally sustainable source of energy
Solar panels are a clean and renewable source of energy that can help reduce carbon footprint and greenhouse gases. An average 4kW system will have the same benefit as planting 100 trees per year. -
Cheap source of energy
On average you will pay $0.10/kWh by purchasing energy from your local utility companies in the state of Kentucky, but by purchasing a solar system with an output of 400 watts per 4 hours you will save around $23,390 over the service life of your panels. Also, the local government is becoming more conscious about the impact of fossil fuels, so regulations could drive up energy prices soon. Over the past decade, electricity cost has already risen by 30%. -
Increase in home value
On average, solar panels add $20 of value to your property for every saved $1 on your electricity bill.
Cons of Solar panels
-
Lack of rebates and incentives
Unlike many other states, Kentucky does not offer any rebates or incentives for going solar. The main reason is that the electricity price of $0.10/kWh in Kentucky is one of the lowest in the country, and therefore utility companies do not offer any solar rebates. -
No tax exemptions
there are no tax exemptions for solar power in Kentucky. Solar systems are subject to both sales and property taxes.
Is it worth buying solar panels in Kentucky?
Kentucky gets plenty of sunlight and has a favorable net metering policy for going solar. The outlook is even better if you are a Tennessee Valley Authority utility customer since you will get a $1000 rebate for your solar system installation together with a feed-in tariff.
When you install your solar system, 26% of your project expenses apply toward a credit to offset any taxes you owe that year. This federal tax credit is a major incentive to go solar, but it is being phased out by 2022.
Most people are eligible to claim this credit (you must owe federal taxes to be eligible).
System size
- Mini
- Small
- Medium
- Large
-
15 x 315 wattsolar panels - +
-
15 x 300 wattmicroinverter - +
-
2 x 3 800 wattinverter
-
$6,874.06Estimated system cost
Excludes 26% Federal Tax Credit.
This price does not include the installation cost. -
5 yearsAverage system payback period
-
$49,796.75Estimated utility savings
Example of 4 kW system calculation in Minnesota for electricity bill $100
-
11 ¢ /kWhThe cost of electricity today in Inter County Energy Coop
-
24 ¢ /kWhIf you don't get solar. The forecast average utility price over the next 25 years
-
5 ¢ /kWhlevelized cost of solar energy