Are there any solar panel incentives in Indiana?
Indiana offers few statewide residential solar incentives, but some homeowners may qualify for local rebates or financing programs. Availability depends largely on where you live and which utility serves your home.
Bloomington Green Home Improvement Program
Bloomington homeowners may qualify for a rebate covering 20% of eligible solar costs, up to $5,000. Qualifying low-income homeowners can receive 40% of costs, up to $10,000. You must own and occupy a home within Bloomington city limits, and funding is limited.
Former solar property tax deduction in Indiana
Indiana used to offer a solar-specific property tax deduction that kept the added value of a solar energy system out of a property’s assessed value. It didn’t make solar cheaper upfront, but it could prevent the system from increasing the homeowner’s future property tax bill.
Without the deduction, an assessor may include the value solar adds to your home when calculating its assessed value. Whether your tax bill increases — and by how much — depends on your assessment and local tax rates.
Non-residential solar incentives in Indiana
Bloomington’s SEEL program offers grants of up to $25,000 to eligible small businesses, nonprofits and community organizations for solar panels, battery storage and energy-efficiency projects. Funding is limited and is not available to individual homeowners.
What to know about net metering in Indiana
Net metering allows homeowners with solar panels to use the electricity they produce first and send any extra power back to the grid. How much credit they receive for that electricity depends on their utility and when the system joined its program.
At Indiana’s major investor-owned utilities, eligible legacy customers continue to receive full retail-rate net-metering credits. New customers receive lower Excess Distributed Generation credits instead.
Customers who were already participating when their utility’s net-metering tariff ended can generally keep full retail-rate credits until July 1, 2032. Customers with qualifying systems installed before 2018 may keep those credits until July 1, 2047.
Excess Distributed Generation
New customers of Indiana’s major investor-owned utilities receive Excess Distributed Generation credits instead of full-retail net metering. Each utility calculates an annual rate based on its average marginal wholesale electricity price from the previous year, plus 25%, subject to approval by the Indiana Utility Regulatory Commission.
Because this rate is usually much lower than the retail price of electricity, homeowners generally save more by using solar power at home than by exporting it to the grid. Municipal utilities and electric cooperatives may set their own compensation policies.
Solar panel costs in Indiana
Average solar panel costs in Indiana generally range from $14,262 to $28,524.
System size is a major cost factor when going solar. A typical Indiana household needs about a 8.7 kW system, which costs $24,795 on average. Depending on your energy needs, you might need a smaller or larger system.
Your total price also depends on whether you add battery storage to your system. Solar batteries cost $7,000 to $18,000, which can nearly double the total system price.
Average solar panel costs by system size in Indiana
| 5 kW | 6 kW | 7 kW | 8 kW | 9 kW | 10 kW | |
|---|---|---|---|---|---|---|
| Statewide | $14,262 | $17,115 | $19,967 | $22,820 | $25,672 | $28,524 |
| Indianapolis | $14,633 | $17,560 | $20,487 | $23,413 | $26,340 | $29,267 |
| Evansville | $12,515 | $15,018 | $17,522 | $20,025 | $22,528 | $25,031 |
Federal mortgage options for solar panels
Some federal mortgage programs let eligible borrowers include solar panels or other energy upgrades in a home purchase or refinance loan. Rules vary by lender.
- FHA financing: Eligible borrowers may be able to finance cost-effective energy improvements through an FHA-insured purchase or refinance mortgage. A home energy assessment is generally required for an Energy Efficient Mortgage. FHA also has separate provisions for financing eligible new solar and wind systems.
- VA Energy Efficient Mortgage: Eligible borrowers may be able to add up to $6,000 in approved energy improvements to a VA-backed purchase loan or Interest Rate Reduction Refinance Loan. For improvements costing between $3,000 and $6,000, the lender must compare the project’s expected savings with the higher mortgage payment.
Compare solar companies in Indiana
A good solar company helps you navigate local incentives, permitting and net metering policies. Compare our picks for Indiana's top solar companies to learn more.
| Company | Customer rating | Pro install | Max. panel efficiency | Panel warranty | Payment options | Year founded | |
|---|---|---|---|---|---|---|---|
 Blue Raven Solar | Learn More | 3.3 |  | Varies | 25 years | Cash, loan, lease, PPA | 2014 |
 SunPower | Learn More | 3.5 | | 22.8% | 25 years | Cash or loan | 1985 |
 ShopSolar | Learn More | 4.4 |  | Varies | Varies | Cash, loan | 2018 |
FAQ
Are solar panels worth it in Indiana?
Going solar is often worth it in Indiana for the long-term savings on utility bills. Over 25 years, residents with solar panels avoid $24,351 in utility costs on average.
Your current electric bill is the starting point for assessing the financial benefits of transitioning to solar energy. Your average energy consumption tells you what size solar system you need. Once you know this, you can figure out potential savings and how long it should take for your solar installation to pay for itself.
How can I pay for solar panels?
You can pay cash, but most people finance solar panels with a solar loan. It works a lot like any other type of loan — there's an application and approval process, and you pay it back over time (with interest). You also have the option of getting a lease or power purchase agreement.
» SOLAR PANELS: Lease vs. buy
Is my house a good candidate for solar?
Solar panels work best on large, unshaded roofs that face south or west. The condition of your roof matters too — if it needs replacement soon, do that before installing solar panels. Installing solar panels on an old roof might mean you have to remove the panels, replace your roof and then reinstall the panels. This will cost around $5,000 for a 19-panel setup.
Is my HOA allowed to restrict solar panels?
Indiana law limits an HOA’s ability to block residential solar. If your HOA denies or restricts a system, you may be able to override the decision by collecting signatures from other members. You generally need the lesser of 65% of HOA members or the number required to amend the association’s governing documents.
What has Indiana’s solar investment been so far?
Total solar investments in the state amount to $8.4 billion, according to the Solar Energy Industries Association.
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:
- City of Bloomington, "SEEL Solar and Battery Grants." Accessed July 28, 2026.
- Indiana General Assembly, "House Bill 1196." Accessed July 28, 2026.
- Indiana Department of Local Government Finance, "Legislation Affecting Deductions, Exemptions, and Credits." Accessed July 28, 2026.
- Citizens Action Coalition of Indiana, "Net Metering in Indiana." Accessed July 28, 2026.
- Solar Energy Industries Association, "Indiana." Accessed July 28, 2026.
