Idaho solar incentives, tax credits & rebates

Resources for going solar in 2024

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Do you own or rent?

solar panels installed on a tall slanted rooftop of a home

The average cost to install a solar energy system is $18,200 in Idaho after the full federal solar investment tax credit, which is more expensive than the national average of $16,715. Still, you can take advantage of a solar tax deduction, rebates and a low-interest loan to make a new system more affordable.


Key insights

  • You can take advantage of solar tax breaks, rebates and loan programs in Idaho.
  • The average federal tax credit value is $7,800 in Idaho.
  • Idaho residents who install solar panels save an estimated $11,478 over 25 years.

Solar incentives in Idaho

The federal solar investment tax credit (ITC) is the biggest factor in reducing the cost of going solar in Idaho. If you install a residential solar panel system by the end of 2032, you will receive a federal income tax credit equal to 30% of the system's total cost, including equipment, labor and permits.

The federal solar investment tax credit drops to 26% in 2033 and 22% in 2034

For example, in Idaho, a solar system costs $26,000 on average. At that price, you can get a $7,800 credit when you file your taxes.

The solar tax credit is not a rebate or refund — you must claim it when you file federal taxes in the year that your solar panel system becomes operational. To do this, you have to complete Form 5695. The credit is also nonrefundable, so any unused portion rolls over into the next tax year.

Statewide residential solar incentives in Idaho

Idaho has three ways to save on solar systems. Homeowners can take advantage of tax breaks, rebates and a low-interest loan program.

Residents can get a state income tax deduction of 40% of the cost of their solar system the first year it's operational. Then they can get an additional 20% each year for the next three years. The deduction is capped at $5,000 each year and $20,000 total.

» MUST-KNOW: The tax benefits of owning a home: deductions and secrets

Idaho customers of Dominion Energy can also get a $750 rebate for solar water heaters. This includes solar pool heaters as well as indoor water heaters. To qualify, customers must apply on the electric company’s online rebate page, by email or by mail.

Through the Idaho Office of Energy and Mineral Resources, residents can get a solar loan of up to $30,000. Homeowners can choose between three types of loans:

  • 3% interest with a 36-month term
  • 5% interest with a 60-month term
  • 7% interest with an 84-month term

What to know about net metering in Idaho

When your solar system produces more energy than you can use and you don’t have a solar battery to store it in, there’s another option. Through net metering, you can sell the excess energy to your local electric company.

Idaho doesn’t have a statewide net-metering policy, but Avista Utilities, Idaho Falls Power, Idaho Power and Rocky Mountain Power offer net metering for residential customers with systems up to 25 kilowatts (kW). Since there are no state policies, net metering terms will vary from one power company to another.

» GREENEST STATES: Idaho ranks No. 7

Solar resources in Idaho

Below are additional resources that can guide you through transitioning to solar in Idaho.

» GUIDE: Solar panel installation

Find solar companies in Idaho

Compare popular solar companies available in Idaho below. Read our guide to finding the best solar companies for more.

Do you own or rent?

FAQ

Can I get solar panels for free in Idaho?

No, but you can lease solar panels or enter a power purchase agreement (PPA) with minimal upfront costs. Still, neither is totally free. Solar leases generally require a flat monthly fee; PPAs make you pay per unit of electricity.

» FREE SOLAR PANELS: Are they really free?

How can I pay for solar panels?

You can purchase your system upfront, but most people finance solar panels. A solar loan works like any other type of loan — there’s an application and approval process, and you pay it back over time (with interest). You can also go with a lease or enter a power purchase agreement.

» SOLAR PANELS: Lease vs. buy

How much can I save with solar panels in Idaho?

In Idaho, the average savings is $11,478 over 25 years. Even if you don’t generate 100% of your energy needs, you can still save a lot of money versus paying traditional utility bills.

Are there any commercial solar incentives in Idaho?

There are commercial solar bond incentives, property tax incentives and rebates available in Idaho.

» MORE: Commercial solar panels

Are there any disadvantages to going solar in Idaho?

The biggest disadvantage is that your savings aren’t as significant as in other states. Over around 25 years, you could save an average of $11,478. While that’s a lot of money, it’s low compared with states like California ($30,000), Connecticut ($42,705), Hawaii ($49,459) or Massachusetts ($33,013), to name a few.

» MORE: Solar energy pros and cons

Is my HOA allowed to restrict solar panels?

An HOA can restrict your solar panels, but it can’t make rules that will prevent you from putting up solar panels, make the panels more expensive for you or inhibit the functionality of the panels, according to Idaho House Bill 158.

Bottom line: How much are solar panels in Idaho?

Idaho is on the list of top 10 green states. While Idaho is somewhat more expensive than other states when it comes to going solar, it does offer several ways to save on a new system. The tax incentives and rebates can save you a lot of money. Plus, the state's low-interest solar loan options can make paying for your system more accessible if you don’t have the cash on hand.

The ConsumerAffairs Research Team conducted an in-depth analysis to determine how much it costs to go solar in Idaho and the average solar costs in other states.

Solar costs: Idaho vs. nearby states

*Before the federal investment tax credit (ITC); **When you pay in full upfront

Article sources
ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
  1. DSIRE, “Idaho Programs.” Accessed Nov. 6, 2023.
  2. DSIRE, “Net Metering in Idaho.” Accessed Nov. 6, 2023.
  3. EcoWatch, “ How Much Do Solar Panels Cost in Idaho?” Accessed Nov. 6, 2023.
  4. United States Environmental Protection Agency, “Summary of Inflation Reduction Act provisions related to renewable energy.” Accessed Nov. 6, 2023.
  5. Solar Energy Industries Association, “Idaho Solar.” Accessed Nov. 6, 2023.
  6. Idaho State Legislature, “House Bill No. 158.” Accessed Nov. 6, 2023.
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