A 30% federal income tax credit is available to homeowners for solar equipment placed in service before December 31, 2019.
Each state varies on if, or how much, of an incentive or rebate they offer. Kansas does not offer an income tax credit but does offer net metering.
What is net metering? Simply put, net metering allows you to sell any solar electricity you generate but don’t use back to Westar for a specified rate. We track it on a monthly basis and any surplus energy production is applied as a credit to your next bill at the cost we would have otherwise paid to generate that energy ourselves.
Net metering plays an important role in calculating your return on investment (ROI) and payback period for your private solar system so it’s very important to understand how it works and how it might change over time.
In 2014, the Kansas Legislature recognized the need for changes in how this process works and changed Kansas law to allow for the excess energy provided back to the grid to be settled on a monthly basis, rather than the previous yearly basis. In October 2015, the Kansas Corporation Commission (KCC) approved a new tariff for residential customers who generate their own electricity. This includes private, rooftop solar. It’s important to know that at some point in time, the price Westar credits for private solar will change. Make sure you understand how a change in rate plans could affect your payback for the investment.
Today, Kansas and other states are facing a dilemma, we want to see private, rooftop solar grow and to provide customers more options for their energy but at the same time we want to be fair to those customers who don’t choose rooftop solar or other forms of private energy generation. Under net metering, Westar credits solar customers for the energy they produce and put back on the power grid. We then pass those costs back to our other customers as part of the overall cost of energy they use. The more we credit our private solar customers for their excess energy, the more costs it pushes back to our other customers. We need to find the right balance in what we credit private solar customers that doesn’t hurt solar growth but doesn’t push more costs onto the rest of our customers. So there is a lot of discussion going on with the state regulators, solar groups and Westar on how to find the right balance.
To learn about the incentives for Kansas residents, visit the Database of State Incentives for Renewable Energy and the Department of Energy.
Database of State Incentives for Renewable Energy
Department of Energy, Tax Credits, Savings and Rebates
You should consult your tax advisor to determine how any rebates or incentives will affect your individual financial situation.
Additional information to explore:
Is private solar right for me?
How does private solar work?
Additional solar resources