Indiana Solar Power: 2026 Costs, Incentives & Savings
Solar in Indiana
Indiana electricity rates rose 16% between 2020 and 2024, and now sit at 14.84 cents per kWh — leaving many homeowners looking for a way to take more control over their energy costs. Solar panels can help you do exactly that.
This guide walks you through everything you need to know about solar installation in Indiana — from how the process works to what it costs — so you can make a confident, well-informed decision for your home.
INDIANA by the Numbers
36th Most residential solar in the United States
10k Households have installed solar panels
4.6 Average daily peak sun hours
~$58k Indiana average savings over 25 years
Indiana Solar Panel Cost
Curious what solar actually costs in Indiana? We built this calculator using real installation data from cities across the state — from Indianapolis and Fort Wayne to Evansville and South Bend. See your estimated monthly lease payment through Palmetto’s LightReach program (no upfront cost required) or explore a full cash purchase — side by side, so you can decide what works best for you.
Lease Cash Purchase
System Size
This system size is designed to offset approximately 100% of the average electricity usage for a home in Indiana.
Recommended System
8.91 kW
Typical for your home size in IN
Your Monthly Payment
Estimated monthly cost with LightReach
$114/mo
As low as $114/mo
Why Lease Solar?
Following the 2025 Big Beautiful Bill, the federal 30% solar tax credit is no longer available for cash purchases. With a LightReach lease, Palmetto owns the system and still qualifies for the commercial ITC — passing those savings through to you via lower monthly payments.
- No upfront investment
- Palmetto handles all maintenance
- 90% Production Guarantee
- Comprehensive protection program included
System Size
This system size is designed to offset approximately 100% of the average electricity usage for a home in Indiana.
Recommended System
8.91 kW
Typical for your home size in IN
Cost Breakdown
Your estimated investment
System Cost
$26,559
Cost Per Watt
$2.98/W
Final Cost
$26,559
Savings
Your total financial benefit
Monthly Savings
Average utility bill reduction
$131
Payback Period
Break-even point
13.8 years
25-Year Savings
$57,744
Get Your Personalized Quote
Based on Palmetto Solar installations in Indiana. Current electricity rate: 14.8¢/kWh. Assumes 90% credit of retail rate.
Palmetto Reviews
The process from beginning to the end of having our system installed was nothing but great! They answered all questions and were willing to update on everything that was going on during the process. It’s been a couple of months now since we’ve had the system installed and can tell a huge difference in our energy bill already.
— Zachery Umphrey, Lillington, North Carolina
I got my solar system a few months ago and have already seen a huge reduction in my power bill. Palmetto did a great job on my install and have been good to work with. I am looking forward to having no light bill at all one day as I reduce my carbon foot print. Solar is the new power source of the future and Palmetto Solar is the place to buy it.
— Van Guines, Richmond, Virginia
This was a good choice for us. Everything was explained in advance. Installation happened on time. Palmetto responds quickly when we have questions. We are enjoying the savings every month.
— Linda Pischke, Mukwonago, Wisconsin
Key Takeaways
- Indiana electricity rates have risen 16% since 2020, making solar a smart way to take control of your energy costs.
- With Palmetto’s LightReach lease, you can go solar for $114/month — no upfront cost, and Palmetto handles all maintenance.
- Indiana offers a full property tax exemption and 7% sales tax exemption on solar equipment, reducing your overall cost of going solar.
Indiana Electricity Prices
Electricity in Indiana costs less than the national average — but that gap is closing, and rates are still climbing.
Indiana’s average electricity rate rose from 13.4¢ per kWh in 2021 to 14.8¢ in 2024 — a jump of more than 10%. The national average climbed even faster, reaching 16.5¢ in 2024. Utility costs are moving in one direction.
Solar panels let you generate your own electricity at home, reducing how much you buy from the grid. The more you produce, the less exposure you have to rate increases you can’t control.
Price of Energy: Indiana vs National Average
0¢
10¢
20¢
30¢
13.7¢
13.4¢
15.0¢
14.6¢
16.0¢
14.9¢
16.5¢
14.8¢
2021
2022
2023
2024
US Average
Indiana
Indiana Area Utility Providers
Indiana homeowners are served by five main utilities — AES Indiana, Duke Energy Indiana, NIPSCO, Vectren, and Indiana Michigan Power — each charging meaningfully different electricity rates (2023 data).
NIPSCO (17.9¢/kWh) and Vectren (17.2¢/kWh) exceed the 2023 national average of 16.0¢/kWh. AES Indiana (13.8¢) and Duke Energy Indiana (14.3¢) fall below Indiana’s 2023 state average of 14.90¢/kWh. Indiana Michigan Power sits at 16.1¢/kWh.
Indiana Utilities Electricity Rates
| Utility | Rate | Change |
|---|---|---|
| AES Indiana | 13.80¢ | -14% |
| Duke Energy Indiana | 14.30¢ | -11% |
| NIPSCO | 17.90¢ | +12% |
| Vectren | 17.20¢ | +7% |
| Indiana Michigan Power | 16.10¢ | +1% |
| IN Average | 14.90¢ | -7% |
| US Average | 16.0¢ | — |
Indiana Solar Incentives
Indiana homeowners have access to several solar incentives in Indiana — at the state, utility, and local level — that can meaningfully reduce the cost of going solar.
These include a 100% property tax exemption on added home value, a full sales tax exemption on equipment, net billing credits for surplus energy, and local rebate programs in cities like Bloomington — all worth understanding before you decide.
| Incentive | Type | Description | Source |
|---|---|---|---|
| Indiana Renewable Energy Property Tax Exemption | Property Tax Exemption | Indiana exempts 100% of any increase in home assessed value resulting from a solar installation from property taxes, saving homeowners money every year they own the system. | Learn More |
| Indiana Sales Tax Exemption for Solar Equipment | Sales Tax Exemption | Indiana exempts residential solar energy system components from the state’s 7% sales tax, saving homeowners $2,300–$3,200 upfront at the point of purchase. | Learn More |
| Indiana Excess Distributed Generation (EDG) / Net Billing | Net Metering | Indiana’s net billing program credits solar customers for surplus electricity exported to the grid at 125% of the avoided-cost rate (roughly 3–5 cents per kWh). | Learn More |
| NIPSCO Feed-In Tariff | Net Metering | NIPSCO’s Feed-In Tariff offered eligible customers $0.13–$0.17 per kWh for solar generation, but the program is currently closed to new applicants. | Learn More |
| Bloomington Green Home Improvement Program (BGHIP) | Rebate | Bloomington homeowners can receive rebates of 20–40% of solar panel or battery storage project costs, with maximums up to $10,000 for solar and $8,000 for battery storage. | Learn More |
| Bloomington Sustainable Energy Equity and Leadership (SEEL) | Rebate | The Bloomington SEEL program offers grants of up to $25,000 for solar PV installations for eligible nonprofits and small businesses in Bloomington. | Learn More |
| PowerSave Indiana Loan Program | Rebate | The Indiana Energy Independence Fund (IEIF) offers below-market unsecured financing statewide for solar and battery storage installations through the PowerSave Indiana loan program. | Learn More |
| USDA Rural Energy for America Program (REAP) | Rebate | Indiana agricultural producers and rural small businesses can receive USDA REAP grants covering up to 50% of eligible solar or battery storage project costs. | Learn More |
Indiana Solar Irradiance
Solar panel production varies throughout the year based on daylight hours, weather patterns, and sun intensity. Indiana gets cold, cloudy winters, but long summer days and ample sunshine make it surprisingly solar-friendly. The right system can generate strong year-round savings, regardless of seasonal weather shifts.
About the Data
This map shows average daily solar energy across Indiana based on historical data.
What the colors mean:
- Excellent solar potential (≥4.54 kWh/m²/day)
- Good solar potential
- Moderate solar potential (≤3.49 kWh/m²/day)
Key Facts:
- Values shown are daily averages
- Based on 18 years of satellite data
- Click any area for detailed estimates
What Can the Average Indiana Solar System Power?
Summer Production (July): 46.5 kWh/day
- Power 3.6 average Indiana homes (15 kWh/day per home)
- Run central AC for 18 hours
- Fully charge 5.4 Tesla Model 3 electric vehicles
Winter Production (December): 21.0 kWh/day
- Power 2 average Indiana homes (15 kWh/day per home)
- Keep your home heating system running for 15 hours
- Fully charge 3 Tesla Model 3 electric vehicles
Annual Production: 13309 kWh/year
- Offset 10 tons of carbon dioxide emissions
- Equal the environmental benefit of planting 175 trees
- Save approximately $4,234 in electricity costs
Solar Installations in Indiana
Curious how many of your Indiana neighbors have already made the switch to solar? We’ve mapped thousands of real solar installations across the country — right down to the address level. Explore the map below to see which communities and neighborhoods near you are going solar. You might be surprised how many are already on board!
Go Solar with LightReach — No Upfront Cost
For Indiana homeowners, Palmetto offers solar leasing through the LightReach energy plan — one of the most straightforward ways to go solar with no upfront cost. With a solar lease, you pay a simple fixed monthly amount rather than purchasing the system outright. Palmetto owns and manages everything, so you get the benefits of solar without the financial risk or maintenance responsibilities.
Frequently Asked Questions
Does Indiana have net metering?
Indiana’s largest investor-owned utilities — including AES Indiana, Duke Energy Indiana, NIPSCO, CenterPoint Energy, and Indiana Michigan Power — no longer offer traditional net metering to new solar customers. Instead, new installations are enrolled in the Excess Distributed Generation (EDG) program, which credits surplus solar electricity at roughly 3–5 cents per kWh — well below Indiana’s retail rate of 14–17 cents per kWh.
Do solar panels increase your home value in Indiana?
Yes — but only if you own your solar panels outright. Research from Zillow found that homes with solar panels sell for approximately 4.1% more than comparable homes without them. For the average Indiana home, that could mean a meaningful boost at resale.
How much does it cost to go solar in Indiana?
For Indiana homeowners, the most accessible way to go solar is through Palmetto’s LightReach lease — starting at $114/month with no upfront cost. Palmetto owns and maintains the system, includes a 90% Production Guarantee, and provides a comprehensive protection program. Your savings begin as soon as your panels are active.