2025 Solar Incentives Guide for Shelbyville, KY - Tax Credits & Rebates

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

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 Shelbyville solar installers to see how much you can save.

By EcoWatch Local Advisors

Data Analysis: James Savino

Ranking Methodology: Karsten Neumeister

Updated January 24, 2025

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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 Shelbyville?

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/


The phrase "solar incentives" broadly refers to financial incentives designed to encourage people to use renewable energy by making solar panels more affordable. Different types of incentives, including discounts, cash back or credit towards your monthly utility bill, may be available to you. Some incentives may be offered by the Kentucky government, by your utility company or by county or municipality, while others are federal. Some broad categories of solar incentives include:

  • Net Metering: Make sure you talk with your Shelbyville utility company about signing a net metering agreement. This will allow you to receive credit towards your monthly utility bill for the value of excess energy your solar panels generate. You may receive either a dollar-for-dollar credit or a percentage of the value.
  • Rebates: Solar rebates might be provided by your local utility company, or by your state or county. These rebates work as partial refunds that are applied after you purchase a solar system and before tax credits are calculated.
  • Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the federal government.
  • Tax Exemptions: These may come in the form of property tax exemptions, which would allow you to ignore the value added by your solar panels when calculating the taxes you pay on your home. You may also qualify for an exemption on sales tax at the time of purchase.
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Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some familiarity with. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a predetermined percentage of the cost of your solar system.

The ITC is applied to the total cost of installing solar panels, including the panels themselves as well as labor, accessories and equipment. This credit can be claimed for panels installed after January 1, 2006, on a primary or secondary residence located in the United States that you own. The tax credit ranges from 26-30% of total costs depending on when your project was completed. There is no maximum claim amount.

Your local Shelbyville solar panel installer can provide you with more information about the ITC and how it applies to your situation.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now dubbed the Clean Energy Credit. The new Clean Energy Credit now runs until 2035. You can now apply for a 30% credit for solar systems installed between 2022 and 2032. The total credit will then decrease annually until the date of expiration. Beginning in 2023, it will also be easier to obtain credits for energy storage systems under the new laws.

Click here to learn more about the new Inflation Reduction Act. To best understand how the new Clean Energy Credit will apply to you, reach out to your local Shelbyville solar installers.

State & Local Solar Incentives

Federal solar incentives are not your only option; tax credits, rebates and more might also be offered at the state and local level. Incentives may be offered by the state of Kentucky, or by your county or municipality. Some incentives are available for only a limited time, while others are ongoing.

Next Steps for Installing Solar in Shelbyville

Solar incentives may come from the Kentucky government, the federal government or your local utility company. The growing number of available solar incentives has contributed to a large increase in solar energy use in the last 15 years. We suggest talking to your local Shelbyville solar installation expert for more information about these incentives and to be sure that you're getting the most money possible for your solar system.

EcoWatch's Shelbyville, KY Solar Incentives FAQs

How much can I save on my electric bill annually if I add solar panels to my house in Shelbyville?

When you add solar panels to your house in Shelbyville, you can anticipate savings of approximately $789.36 per year, or around $14,997.79 over 20 years.

What are some environmental benefits of installing solar panels on my home?

Solar energy is renewable — by changing where you get your energy, you help reduce the strain on our planet's resources. Solar panels can also reduce the CO2 emissions from your home by 400 pounds annually, or around 8,000 pounds in 20 years.

How long until the federal solar tax credit ends?

The Clean Energy Credit (previously called the federal solar tax credit, or ITC), is slated to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.

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

The new Inflation Reduction Act includes provisions for multiple 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.

Can I use multiple types of renewable energy to power my home?

You can use multiple types of renewable energy, or a combination of renewable and non-renewable energy, to power your home. Be sure to go over your plan with your local Shelbyville solar installer. They can help you with the plan for your project and give you an understanding of various incentives that you might or might not qualify for.

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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