Why You Can Trust CNET What to Know If You're Considering Solar Panels in Kentucky
Solar panels are more affordable than you might expect. Here's how to make the most of them in Kentucky.
Utility costs are rising in Kentucky. Solar panels can help you keep up.
Kentucky has seen electricity costs rise significantly in the last year. One way you might be able to fight back? Solar panels.
The Bluegrass State ranks 46th in terms of installed solar capacity, according to the Solar Energy Industries Association. But the industry is expected to grow, especially with expanded financial incentives offered by the federal Inflation Reduction Act.
More Kentuckians are realizing the potential savings to be found by installing solar panels, according to Carrie Ray, energy program coordinator at the Mountain Association, a Kentucky clean energy advocacy group. Electricity rates in Kentucky rose by more than 10% from November 2021 to November 2022, according to CNET's sister site SaveOnEnergy.
"We've seen in Kentucky that the increased cost of fossil fuels has been making bills skyrocket," Ray said in a phone call. "Something like installing solar is a way to mitigate some of those big spikes that we have seen and we're going to continue to see."
Here's what you need to know about how to get solar panels and how they can help with your energy costs.
Kentucky solar panel costs
The price of a solar system can vary widely, depending on the size, the pitch of your roof, the type of solar panels you get and whether you connect it to a battery or to the grid. That's why it's important to shop around with different installers to find the best deal.
Solar prices have dropped significantly in recent years. An analysis by the National Renewable Energy Laboratory, a government research agency, found the cost per watt for a residential system in 2020 was just over a third of what it was in 2010.
"The price for solar may be much more reasonable than you think," Ray said. "Don't dismiss it out of hand."
Here's a look at what the typical system might cost in Kentucky, using data from FindEnergy.com, compared to national averages from consulting firm Wood Mackenzie.
Kentucky vs. the whole US
| System size (kW) | Price per watt | Installed cost | |
| Kentucky | 10 | $3.38 | $33,800 |
| US | 9 | $2.99 | $23,920 |
Kentucky solar panel incentives and rebates
The biggest bit of financial help you can access for solar panels in Kentucky is a federal tax credit that can offset 30% of the total cost of a solar system. That credit was expanded and extended until 2032 by the recently passed Inflation Reduction Act. Because it's a tax credit, you should do the math ahead of time to make sure you'll owe enough on your taxes to get the full value.
"The tax credit is there, but don't just assume you'll be able to access it," Ray said. "You've got to make sure you have enough tax liability to make it worthwhile. Talk to your tax professional before moving forward."
Kentucky doesn't have many state-level incentives for residents to go solar, although it does require most utility companies to allow net metering. That means if you install solar panels you can sell excess energy back to the grid. You can also enter into an agreement with your neighbors to guarantee that you'll have access to sunlight, known as a solar easement. That might be helpful if you're concerned a future neighbor might block your access to the sun.
Kentucky solar incentives
| Program | Description |
|---|---|
| Residential clean energy credit | This tax credit covers up to 30% of the cost of installing a solar system. There's no limit on how much can be claimed under the credit. |
| State solar easement laws | Kentucky law allows residents to obtain easements -- an agreement with your neighbor -- in order to have access to direct sunlight. The easements must be in writing. |
| Net metering | State law in Kentucky requires utilities to offer net metering, in which customers with solar panels or other generation can sell excess power back to the grid. |
How to pay for solar panels in Kentucky
Solar panels are a major commitment. Even after considering the federal tax credit, you're likely looking at more than $10,000. Here are some ways to come up with that money:
Cash: If you can afford it, this is the easiest way to save on interest and financing costs. Planning on going solar eventually but not ready to take the plunge just yet? Consider saving money in a high-yield savings account to maximize your return.
Loans: Your solar company may offer its own financing or partner with a financial institution. You can also consider other loan options, such as a personal loan, home equity loan or home equity line of credit. Shop around to make sure you get the best deal. "Make sure that you know what your savings are estimated to be and that whatever financing you take is going to pay for itself within 20 years," Ray said.
Lease or power purchase agreement: With a lease or power purchase agreement, you don't own the panels. Instead you pay to rent them, with a lease; or you have a developer put solar panels on your house and you just pay for the energy, in a PPA. These can provide opportunities if you don't have the cash to pay for panels, but they also might not save you as much money in the long run.
Kentucky solar panel companies
So you want solar panels and you have an idea of how to pay for it. The question is, who do you buy from? You may not want to sign up with the first company that sends a sales rep to your door, experts say. Choosing the wrong company can lead to a bad experience or to costs that eat away any potential savings you'd see from offsetting your energy use or net metering.
"We always encourage folks to get more than one bid," Ray said. "Do not go with the first bid you get, just like you wouldn't buy a car from the first dealer you talk to."
Kentucky has 47 solar companies, including 10 installers and developers, according to the Solar Energy Industries Association. Here are some to consider, including a couple from CNET's list of best solar companies:
Solar Energy Solutions
Based in Lexington, Solar Energy Solutions also has locations in Louisville, Cincinnati, Indiana and Illinois. The company offers a variety of solar panels along with battery systems. Solar Energy Solutions is certified by the North American Board of Certified Energy Professionals and says it does not subcontract any of its work, with licensed journeyman or master electricians present on every job.
Solar Holler
While it's based in West Virginia, Solar Holler also serves Kentucky as part of its broader mission to provide solar to Appalachia. It offers a three-year guarantee that the system will produce at least 95% of the annual production projected. Solar Holler offers loans including terms of 20 and 25 years.
SunPower Solar
A major national installer, SunPower Solar offers some of the most efficient panels along with strong warranties. SunPower's panels have an efficiency rating of up to 22.8%, some of the best in the game for residential solar. More efficient panels mean you'll convert more of the sun's energy into electricity, producing more power and saving more money over the long run.
Tesla Solar
Tesla offers some of the market's most affordable solar panels, including a price-match guarantee. The company also offers battery systems and other related products, including a solar roof that looks more seamless than the lowest profile solar panels. While you might save money, you may lose out in terms of customer service.
Installation factors to keep in mind
You might be thinking about solar panels as a way to save money on your utility bills or to offset your own electricity usage. Whether the panels pay for themselves depends a lot on making sure you're getting a good deal. Here are some things to consider:
- Your home's energy efficiency: Solar panels shouldn't be your first step toward optimizing your home's energy use. Take steps to make your home energy efficient first, such as sealing cracks and windows, getting efficient appliances, and getting an energy audit. "Efficiency is much cheaper to invest in than solar," Ray said. "And if you reduce the amount of electricity you need through efficiency, you need a smaller solar array. So you save money twice over."
- The condition of your roof: Your house was built to be a home, not a power plant, so it might not be at the optimal angle for solar panels. If your roof faces a less-than-ideal direction (south-facing is generally best in the northern hemisphere) or if it's too steep or not steep enough, panels may not produce enough energy to be worth it.
- HOA and neighborhood regulations: As with any major home project, check with your homeowners association and local regulations to see if you need any particular permission for solar panels. Local restrictions may also affect the size or type of solar array you can build.
- Insurance coverage: Let your homeowner's insurance company know about your solar panel project. Most policies cover rooftop solar panels, but it's a good idea to check.
- Rentals: You may not be allowed to install solar panels if you rent your home, but it's worth having a conversation with your landlord or management company. If panels aren't a possibility, consider community solar programs, which allow you to pay for energy produced at another solar facility in exchange for a credit on your energy bills.
FAQs
How can I avoid scams?
Do plenty of research on solar companies before making a decision. Make sure the company you choose is certified by the North American Board of Certified Energy Professionals and that they do a site visit and handle the permits, inspections and other paperwork for the installation, the Mountain Association suggests. Also watch out for companies that say there is an expiring deal or offer that forces you to act quickly, Ray said.
What if I don't want solar panels on my roof?
Rooftop panels may be what comes to mind first when you think about residential solar, but panels can be mounted on the ground or on other structures, like a garage or carport. If your roof isn't ideal for solar -- maybe it faces the wrong way -- but you have the space, you can consider ground-mounted panels. They cost more, because a structure needs to be built for them, but can save your roof from the stress of construction.