Montana Solar Incentives, Tax Credits and Rebates

Are there any solar panel incentives in Montana?

The federal solar tax credit previously helped reduce solar installation costs, but is no longer available for systems placed in service after Dec. 31, 2025. As a result, Montana homeowners typically pay the full upfront cost unless they use financing. However, you may be eligible for a rebate or performance-based incentive.

Yellowstone Valley Electric Cooperative rebate

This rebate from Yellowstone Valley Electric Cooperative (YVEC) helps cover the cost of installing a solar-powered system to water livestock. If your system costs $2,000 or less, the co-op will pay 50% of the cost. If it costs more than $2,000, you’ll get a flat $1,000 rebate.

To qualify, you need to be a member of the co-op, have the system connected to their service, and provide proof that it was installed. You also have to apply within 90 days of purchase.

Property tax exemption

Montana has a property tax exemption for homeowners installing solar power systems. Here’s how it works: The added value to your home from a solar installation is exempt from property taxes for up to 10 years. For single-family homes, this benefit is capped at $20,000.

It's an easy way to save taxes while investing in renewable energy. To apply for this energy-generating property tax incentive, use Form AB-14. Small businesses and nonprofit organizations are also eligible.

What to know about net metering in Montana

Net metering is a system of give-and-take between you and your utility company. It lets you use power from the grid when your panels aren’t producing enough and earn credits for any extra electricity your system sends back.

In Montana, those credits roll over to future bills during the year. However, at the end of a 12-month cycle, any remaining credits are reset to zero with no payout. This means producing more energy than you use can reduce your overall savings.

NorthWestern Energy (NWE), one of the state’s largest utilities, limits net-metered systems to 50 kW and does not allow aggregate or virtual net metering.

Rural electric cooperatives set their own rules. Some still offer full retail credit, while others use a “net billing” model, where excess energy is credited at a lower rate. Because policies vary, it’s important to check with your specific utility before installing solar.

Solar panel costs in Montana

Average solar panel costs in Montana generally range $13,289 to $26,579.

System size is a big cost factor when going solar. A typical Montana household needs about a 7.1 kW system, which costs $18,886 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 Montana

Ways to pay for solar panels

Going solar is similar to buying a car: You can pay cash, but many people finance or lease systems with minimal upfront costs. Leasing solar panels lets you install a system without high upfront costs. A solar company installs and maintains the panels on your property, and you pay a monthly fee to use them.

Alternative Energy Revolving Loan Program

The Montana Department of Environmental Quality (DEQ) offers a program with low-interest loans to help pay for solar or energy upgrades in Montana, with rates around 3.5%.

You can use it for things like solar panels or energy-saving improvements, and repay the loan over time.

However, because funding is limited, you have to apply during specific windows, and not everyone who applies will get approved.

Property Assessed Clean Energy (PACE) financing

Montana’s C-PACE program helps cover the cost of solar and energy upgrades by offering long-term financing repaid through property tax assessments instead of a traditional loan.

It can cover up to 100% of project costs and spread payments out over 20 years or more, making large projects more affordable.

However, it’s mainly for businesses, farms, nonprofits and larger multifamily properties — not typical single-family homes.

Federal mortgage financing options

Energy Efficient Mortgages allow homeowners to finance energy-saving upgrades, including solar systems, as part of their mortgage, often with support from federal programs like FHA or VA.

• FHA Energy Efficient Mortgages are available to many homebuyers. This lets you add money to your mortgage for energy upgrades. The upgrade cost must be less than the expected energy savings, and a home energy assessment is required first.
• VA Energy Efficient Mortgages are available to military members, veterans and reservists. This allows eligible borrowers to add up to $6,000 to their loan if projected energy savings justify the cost.
• Conventional Energy Efficient Mortgages are offered by private lenders (not government-backed). You can borrow up to 15% of a home’s value for energy upgrades. This may help borrowers qualify by adjusting debt-to-income rules.

Compare solar companies in Montana

Working with a local solar company in Montana makes it easier to understand local incentives.

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