Are solar panels worth it in Nebraska?

6 factors to consider before getting solar panels in Nebraska

ConsumerAffairs has heard from thousands of solar customers who have already gone through the installation process, including several from Nebraska. Here’s what to consider before making the switch.

1. Solar panel installation costs
2. Your energy consumption
3. How long you stay in your house
4. Nebraska solar incentives
5. Net metering buyback rates
6. How you pay

1. Solar panel installation costs: $10,000 to $30,000

Average solar panel costs in Nebraska are comparable to the national average. Before the federal solar investment tax credit (ITC), a typical residential system ranges from $11,200 to $22,400. That price drops to $7,840 to $15,680 after considering the full 30% tax credit.

Most installers set the price according to the system's wattage, with a typical cost between $2.50 and $5 per watt. “Cost per watt” is a little like looking at the price per square foot when you buy a house. It helps you compare the value of solar energy systems in different sizes. In Nebraska, the average cost per watt is $2.24.

Average solar installation cost by system size in Nebraska

2. Your current energy consumption

Homeowners with solar panels typically save $20,000 to $90,000 over 25 years.

You get the most out of solar if most of your appliances are electric. If you also have an electric vehicle, solar panels will save you even more. (This may be obvious, but solar panels generate electricity. They won’t help you save on gas bills.)

A typical Nebraska household needs a 9.28 kW system to offset its electricity needs with solar energy. Depending on your current energy consumption, you might need a larger or smaller system. Getting your electrical loads as low as possible before going solar is smart. That way, you can get a smaller, cheaper system.

3. How long you plan to stay in your house

Solar panels last 25 to 30 years.

It takes years for electric bill savings to make up for the initial cost — about 11.5 years on average in Nebraska. If you sell your house and move before then, you might not fully realize the financial benefits of your solar investment.

A Zillow study found that, on average, houses with solar panels sell for 4.1% more. Let’s say you spend $25,000 putting solar panels on a house that costs $400,000. It might sell for $16,400 more in a few years, according to Zillow. But, you miss out on some of that $53,725 in total avoided utility costs over 25 years.

In other words, don't get solar panels just because you want to sell your house soon. Consider a home improvement project with a better return on investment, like remodeling the bathroom or kitchen, instead.

4. Nebraska solar incentives: federal and state

Additional solar incentives in Nebraska include a statewide 100% sales and use tax exemption on solar equipment, and some municipalities have PACE financing programs for commercial solar installations.

The federal solar investment tax credit (ITC) is still the most significant incentive for most homeowners going solar. The ITC provides a 30% tax credit on your total system costs, including equipment, labor and permits. It will drop to 26% in 2033 and 22% in 2034.

5. Net metering in Nebraska: retail buyback rate

Net metering policies allow you to earn credits for any extra electricity your solar panels generate. In Nebraska, these credits can offset the cost of electricity used at other times. As of published, current Net Excess Generation (NEG) rates are higher in the summer (June 1 through Sept. 30) and lower in the winter (Oct. 1 through May 31). Most utilities in Nebraska carry over any unused credits to the next billing period. To qualify, your system must have a capacity of 25 kilowatts (kW) or less.

» GREENEST STATES: Nebraska ranked 27th in 2024

6. How you pay

It’s great if you can pay for the whole thing upfront. You own the system from day one and receive the benefits of available tax credits; plus, you don’t have to pay interest on a loan. Alternatively, a solar lease works like a car lease — you get to use the panels but don’t own them.

Given rising energy costs in Nebraska and elsewhere, financing solar panels makes sense as long as your monthly loan payment is less than what you would be paying the utility company anyway. Eligible homeowners can also borrow against equity in their house to pay for a solar installation system.

If you're torn between leasing and buying, consider your long-term plans. Leasing requires less upfront but may cost you more over time. Buying means higher initial costs, but you own the system, which could increase your property value. You also won’t have to worry about transferring the lease if you sell the house.

Monthly costs: solar payments vs. savings

Think of going solar in terms of your monthly costs. Given rising energy costs in Nebraska and elsewhere, financing solar panels makes sense as long as your monthly loan payment is less than what you would be paying the utility company anyway.

Is my house a good candidate for solar panels?

Going solar ends up being worth it for many homeowners as long as their house is a good candidate to support the panel installation. Here’s what to think about before you commit:

• How much sunlight do I get? Solar panels need regular exposure to sunlight to produce the most energy possible. Nebraska averages 4.5 to 5 peak sun hours each day. However, lots of shading — like trees or tall buildings above your roof — could make your solar system less efficient.
• What is the size and angle of my roof? Nebraska (and the rest of the United States) is in the northern hemisphere, so solar panels perform best on south-facing roofs. The worst place to install would be on north-facing roofs, especially if those roofs have a high pitch. For example, if the only place you can install is a north-facing roof with a 30-degree pitch, your costs will likely go up by 30% to 40%.
• What is the condition of my roof? If you have to replace your roof, do that before you install solar panels. Solar panels are designed to last up to 30 years, so you want your roof to last just as long. Otherwise, it could cost thousands to remove the panels, fix your roof and reinstall the panels again.

Pros and cons of solar panels in Nebraska

It’s a common misconception that solar panels will completely eliminate your monthly power bill — but this is not always the case. Still, you’ll likely be paying much less than you would for traditional utility bills.

Benefits of solar panels in Nebraska

The average homeowner in Nebraska uses a lot of power, which adds up to a lot of savings when you switch to solar.

• Cheaper energy bills: Going solar now means that your monthly energy expenses will be more predictable (and very often significantly lower). Solar panels also protect you from future energy cost increases.
• Better for the environment: Installing solar panels on your roof helps the environment primarily by reducing greenhouse gas emissions and dependence on fossil fuels.
• Higher home resale value: Installing solar panels can significantly increase a home's value. The exact increase in value varies by location, with homes in active solar markets sometimes seeing even higher boosts.
• More energy independence: Embracing solar paves the path toward true energy independence. It especially works out for people in areas susceptible to power outages.

Drawbacks of solar panels in Nebraska

Solar doesn't work out for everyone. We suggest using the National Renewable Energy Laboratory’s PVWatts Calculator or Project Sunroof to estimate your potential energy production and savings.

• Solar equipment is expensive: Even with rebates and other financial incentives, the price typically starts between $10,000 and $30,000. It’s even more expensive if you want a solar battery for energy storage. Solar battery costs are generally between $7,000 and $18,000.
• Potential roof leaks: The installation process involves drilling holes into the roof to anchor the panel mounting systems. If not done correctly, this can lead to leaks or structural damage.
• Energy production varies: Solar panels are dependent on weather conditions and seasonality. Solar panels still work on cloudy days, but less available sunlight does affect how efficiently they produce energy. Snow cover may also temporarily reduce efficiency until it's removed or melts off.

» MORE: Solar energy pros and cons

Find solar companies in Nebraska

A good solar company helps you navigate local incentives, permitting and net metering policies. In the best-case scenario, it’s easy to make the switch and you’re happy with your system’s performance. In the worst-case scenario, you end up paying thousands for mid-tier solar equipment from a company with poor customer service and no follow-up or support. Compare our picks for Nebraska’s top solar companies to learn more.

Bottom line: Is going solar in Nebraska worth it for you?

The ConsumerAffairs Research Team has conducted extensive research to compare the costs of going solar in Nebraska and other states. Homeowners with solar panels can typically save more than that in total avoided energy costs over the lifetime of a system.

Solar costs vs. savings: Nebraska and nearby states