2024 Solar Incentives Guide for Lexington-Fayette, KY - Tax Credits & Rebates

In this guide, we'll cover the latest solar incentives and rebates available in Lexington-Fayette.

You'll learn about:

  • Local & State Solar Incentives
  • Federal Tax Credits (Updated for 2024 and beyond)
  • Ways to optimize your solar investment

Solar installers are experts in maximizing your solar tax credits and rebates.
Get a free quote from one of our trusted Lexington-Fayette solar installers to see how much you can save.

By EcoWatch Local Advisors

Data Analysis: James Savino

Ranking Methodology: Karsten Neumeister

Updated February 03, 2024

Why you can trust EcoWatch

We work with a panel of solar experts to create unbiased reviews that empower you to make the right choice for your home. No other site has covered renewables as long as us, which means we have more data and insider information than other sites. Our rankings are never affected by revenue or partnerships.

What Solar Tax Credits, Incentives, and Rebates are Available in Lexington-Fayette?

Clark Energy - Residential Energy Efficiency Rebate Programs

Incentive Type:
Rebate Program
Heat Pump Retrofit: Up to $750
Air Sealing/Ceiling Insulation: Up to $750
SimpleSaver Program: $20/yr/air conditioner enrolled
ENERGY STAR Manufactured Home: Varies, contact utility for more information
CARES Program: Up to $2,000/household

Federal Residential Renewable Energy Tax Credit

Incentive Type:
Personal Tax Credit
30% federal tax credit for systems placed in service after 12/31/2021 and before 01/01/2033. Good for: solar water heat, solar photovoltaics, biomass, geothermal heat pumps, wind (small), fuel cells using renewable fuels.

Source: https://www.dsireusa.org/


Solar incentives are designed to mitigate the cost of installing solar panels on your home. These financial incentives are in place to encourage more Americans to switch their home over to renewable energy. Different kinds of incentives, including cash back, discounts or credit towards your monthly utility bill, may be available to you. Certain incentives may be provided via the state of Kentucky, by your utility company or by county or municipality, while other incentives are federal. Types of solar incentives might include:

  • Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much income tax you owe the federal government.
  • Net Metering: You can sign a net metering contract with your Lexington-Fayette utility company that will apply to all or a percentage of the excess electricity your solar panels generate. They will then subtract this value from your monthly utility bill.
  • Rebates: Rebates, or cash back after a purchase, are typically applied prior to any solar tax credits being calculated. These rebates may be offered by your local utility company, by your county or by your state.
  • Tax Exemptions: Your solar panel system may qualify for exemptions on both sales and property tax. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions let you ignore the added value of the solar panels when calculating property taxes on your house.

Best National Provider

SunPower

★★★★★
5.0

  • Most efficient panels on the market
  • National coverage
  • Cradle to Cradle sustainability certification
  • Great warranty coverage
  • Expensive
  • Customer service varies by local dealer

Best Solar Financing

Blue Raven Solar

★★★★★
4.5

  • Industry-leading in-house financing
  • Competitive pricing
  • Excellent reputation
  • Doesn't offer solar batteries

Best Technology

Tesla Energy

★★★★★
3.2

  • Price-match guarantee
  • Sleek, efficient, and durable solar panels
  • Best solar battery on the market
  • Some reported issues with customer service
  • Customer service varies by local dealer

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have heard of. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit equal to a predetermined percentage of the money you spend on your solar system.

The ITC initially applied to 30% of the cost of installing solar panels, and has fluctuated slightly over the years between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total cost of installation includes the panels themselves as well as the cost of labor, accessories and equipment. There is no maximum amount you can claim. The ITC applies to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.

To better understand how the ITC will apply to you, contact your local Lexington-Fayette solar panel installation expert and ask for more information.

The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. Homeowners can now receive a credit equal to 30% of the total solar system installation costs for projects started after January 1, 2022, and completed before the end of 2032. The percentage will then begin to decrease on a yearly basis until the Clean Energy Credit expires in 2035. Starting in 2023, it will also be easier to obtain credits for energy storage systems under this new program.

More information about the new Inflation Reduction Act can be found here. Your local Lexington-Fayette solar panel company is the best resource for answering your questions about the new Clean Energy Credit and how it applies to you.

State & Local Solar Incentives

Rebates, tax credits and more can be provided at multiple levels. In addition to federal solar incentives, there are often state and local ones as well. Certain incentives are ongoing, while others might only be available for a limited time. These incentives might be offered by the Kentucky government, or by your county or municipality.

Next Steps for Installing Solar in Lexington-Fayette

The large number of solar incentives available has helped tremendously increase the nationwide adoption of solar energy over the past 15 years. You can get solar incentives from your local utility company, the Kentucky government or the federal government. It is a good idea to talk to your local Lexington-Fayette solar installer to learn more about these incentives and to ensure that you're getting all the money you can for your solar panels.

EcoWatch's Lexington-Fayette, KY Solar Incentives FAQs

How do I learn if I qualify for different solar incentives?

It's best to speak with your local Lexington-Fayette solar installer for a better understanding of which incentives your project may qualify for. Generally, solar incentives apply to new solar systems installed on a property you own (in the U.S.) between the dates specified by the incentive. Some incentives, like those provided by the Kentucky government, might have additional requirements.

If I already have a solar system installed on my house, can I still claim incentives?

If your solar system was installed after January 1, 2022, you may qualify for the recently increased 30% tax credit under the Inflation Reduction Act. If you installed your system between 2006 and 2021, you may qualify for a tax credit between 26% and 30%, depending on the date of installation. Reaching out to the company that installed your solar system, or any local Lexington-Fayette solar installer, can help you understand what incentives you qualify for.

What are some of the environmental benefits of switching to solar energy?

Solar energy is a renewable energy source — by switching where you get your energy, you can help reduce the strain on our planet's resources. You can also reduce your home's CO2 emissions by 400 pounds a year, or around 8,000 pounds over 20 years.

I want to change out my appliances for ones that are more energy-efficient. Are there any benefits I can get?

The new Inflation Reduction Act introduces several incentives meant to reward homeowners for making eco-friendly upgrades. Some incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.

What if I want to add solar panels to a rental property, vacation home or commercial property? Will I still qualify for incentives?

While we recommend speaking with your local solar installer and/or tax professional to better understand what solar incentives apply to you, many incentives apply to a second home, provided that it is in the United States and owned by you. There may be additional incentives available for commercial properties specifically, depending on the details.

Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.

Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.

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