Kentucky’s Key Solar Incentives: A Breakdown

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Kentucky, known for its rich natural resources, is also making strides in solar energy. As the state looks to expand its renewable energy footprint, understanding the available solar incentives is crucial for homeowners and businesses interested in making the switch. In this breakdown, we’ll explore Kentucky’s key solar incentives, including financial benefits, tax credits, and other resources designed to support the growth of solar energy in the Bluegrass State. Whether you’re considering installing solar panels for your home or business, this guide will provide essential information to help you navigate Kentucky’s solar landscape.

The Residential Clean Energy Credit

The Residential Clean Energy Credit, previously known as the Federal Investment Tax Credit (ITC), can reduce the cost of your solar panel system by 30%. This incentive covers the entire system, including equipment, labor, permitting, and sales tax.

To claim this incentive, you need to purchase your system with cash or a solar loan, as leasing does not qualify for the ITC. You must have a sufficient federal tax liability to use the credit, though any unused portion can be rolled over year-to-year until the ITC expires at the end of 2034. Direct payment of the ITC is only available to tax-exempt entities, such as nonprofit organizations.

Net Metering

Net metering is available to all customers of investor-owned utilities and rural electric cooperatives, exempting TVA utilities. Kentucky requires the use of a single, bi-directional meter for net metering. Any additional meter, meters, or distribution upgrades needed to monitor electricity flow in each direction will be installed at the customer’s expense. If the electricity fed back to the utility by the customer exceeds the electricity supplied by the utility during a billing period, the customer is credited for excess generation at the utility’s retail rate. This credit will appear on the customer’s next bill and will carry forward indefinitely. Credits are not transferable. The customer retains ownership of any Renewable Energy Credits.

Solar for All

• Kentucky’s low-income and disaster recovery households will experience significant benefits, including enhanced resilience, reduced energy burdens, savings on utility bills, and environmental improvements through decreased emissions. Ultimately, the Kentucky SFA program positions the state to capitalize on future financial assistance and utility programs for program expansion and growth.
• The Clean Energy Fund of Texas (TxCEF), in collaboration with the Bullard Center for Environmental and Climate Justice at Texas Southern University (BCECJ), collectively known as CEFBC, is dedicated to deploying technical assistance, private capital, and grants to minority-serving institutions. Together, these organizations aim to facilitate the establishment of residential-serving community solar projects in low-income and disadvantaged communities that face significant challenges related to energy policy and grid vulnerability. These projects are anticipated to result in emissions reductions, savings on household utility bills, generation of shared revenues through community ownership, and the mobilization of private capital.

Disclaimer

The information provided herein is for informational purposes only and is accurate as of the time of publication. Please be aware that the solar energy landscape, including technology, regulations, incentives, and market conditions, changes frequently. Therefore, it is essential to consult with qualified experts and professionals before making any decisions regarding solar energy installations or investments. This will ensure that you receive the most current and applicable advice tailored to your specific circumstances.