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How to Save Money on Solar Panels In Idaho

hand holding a toy house next to Delaware state flag and panels under the sun

How to Save Money on Solar Panels In Idaho

Idaho has a majestic wilderness and an abundance of precious minerals. However, what we find surprising is the state’s lack of support for renewable energy despite its environmental focus. This is bad news for homeowners considering solar panels in Idaho.

However, all hope isn’t lost if you want to do your part in reducing carbon emissions. With federal and some state-level incentives, Idahoans can find a way to drop the cost of a solar panel array. Keep reading for an in-depth review of all the benefits available in the Gem State.

How to Save Money on Solar Panels in Idaho: Overview

With decent prices for equipment and better-than-average sunlight, you might think the Gem State would support solar energy. However, Idahoans pay some of the lowest rates on electricity, so there’s not much motivation to make the switch. Homeowners looking to install solar panels in Idaho might try to justify the cost through incentives, which often look like this:

  • Federal solar tax credits
  • State rebates
  • Government mandates

Unfortunately, the Gem State offers menial support across the board. Aside from questionable net metering and some deductions on taxes, homeowners might have to rely on federal assistance to cut installation costs. Let’s cover Idaho’s solar benefits in more detail.

Solar Panels in Idaho: Federal Incentive

On a positive note, Idahoans can still take advantage of the federal tax incentive on solar panels, which provides a 30% credit on residential arrays installed in 2023. Homeowners have until 2032 to have full benefits. After that, the incentive tapers off until 2035, when it ends entirely.

Qualifying homeowners in Idaho can see nearly $5,000 in returns with the federal incentive. To meet the requirements, locals must own their solar panels outright. They must also live at the residence at which the array is installed and buy new equipment only.

Idaho’s State Credits and Rebates

Typically, the best state-level incentive comes in the form of a tax credit because it helps residents afford solar without costing the government any money. Surprisingly, Idaho has a form of solar tax credit that works more like a deduction. 

The program offers 100% back on state income taxes over four years (40% for year one, 20% for three years following). The deduction is capped at $5,000 in any one year, which still limits the potential of this incentive. Ultimately, this program can result in a little over $1,000 back into the pockets of those making the switch to solar.

As far as physical incentives go, however, this is where they end. Idaho has some net metering, but they don’t mandate utilities to pay for excess energy. Furthermore, homeowners might struggle to get their homes connected to the grid in the first place.

Solar Panels in Idaho: Government Regulations

Municipalities in Idaho don’t offer solar benefits to residents because the state has no renewable portfolio standards (RPS). These standards dictate a state’s future goals for investing in renewable infrastructure. Without an RPS, we can infer that Idaho has no plans to support solar energy.

This extends to their regulations. A state with an RPS might typically offer tax exemptions alongside credits or rebates. However, Idaho isn’t making any moves to support renewable energy. So, homeowners will have to pay the full amount on state taxes. The only exception is the deduction we discussed above.

Should Idahoans Lease Solar?

save money on solar in arizona
Idaho receives an average of 4.92 daily peak sun hours.

©Jessica Kirsh/Shutterstock.com

Generally, leasing a solar panel system is hardly worth it. Homeowners don’t get to take advantage of most incentives, including the federal solar tax credit. Plus, they often receive marginal returns on utility offsets. Because Idaho does not support solar leasing, it’s not even an option for those who can’t afford a system outright.

Solar Panels in Idaho: Incentive Summary

BenefitAccessibility
Federal Tax Incentive30% credit
Idaho Tax Credits / Rebates100% deduction over four years/none
Net MeteringApproved but not mandated
Renewable Portfolio StandardNone
Property Tax ExemptionNone
Sales Tax ExemptionNone
Performance Payment ProgramNone

How to Save Money on Solar Panels in Idaho: Further Reading

Despite the abundant natural beauty, the Gem State does not seem intent on protecting the environment with renewable energy. Those considering solar panels in Idaho will have to front the cost of the installation. For more on how Idaho supports emerging technology, read on.

Frequently Asked Questions

Do you actually save money going solar in Idaho?

Idaho has incredibly low electricity rates and hardly any state-level support for renewable energy. Still, those that make the switch to solar can save up to $15,000 on utilities over the course of 25 years.

How long does it take for solar panels to pay for themselves in Idaho?

Idahoans that purchase a 6kW system could cover its cost in 12.7 years by offsetting an average annual electricity bill of $1,194.12.

How much do solar panels cost in Idaho?

In Idaho, homeowners can expect to spend about $2.52 per watt. This equals around $15,120 for a 6kW solar array.

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