Lexington, KY Solar: 2026 Costs, Incentives & Savings
Solar Power in Lexington
If you live in Lexington, KY, and have watched your electricity bill climb year after year, you’re not alone. Kentucky electricity prices have increased 19% from 2020 to 2024, with residential rates now averaging 12.98 cents per kWh—leaving many local homeowners searching for a way to take control of their energy costs.
Solar installation offers a practical path forward. In this guide, our team walks you through everything you need to know about solar installation in Lexington, from how home solar panels work to what to expect during the process.
KENTUCKY by the Numbers
- 40th Most residential solar in the United States
- 9 Households have installed solar panels
- 4.7 Avg peak sun hours per day
- ~$37k Lexington average savings over 25 years
How Much Do Solar Panels Cost in Lexington, KY?
See what solar really costs in Lexington. This calculator uses actual installation data from homes across the area—including Beaumont, Hamburg, Andover, and Chevy Chase. No guesswork, just real local numbers to help you understand your options and make a confident, informed decision.
Lease Cash Purchase
- Small Home Up to 2,000 sq ft
- Medium Home 2,000-3,000 sq ft
- Large Home Over 3,000 sq ft
System Size
This system size is designed to offset approximately 100% of the average electricity usage for a home of this size in Kentucky.
Recommended System
6.80 kW
Your Monthly Payment
Estimated monthly cost with LightReach
$87/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
Cost Breakdown
Your estimated investment
- System Cost: $21,521
- Price per Watt: $3.16
- Final Cost: $21,521
Savings
Your total financial benefit
- Monthly Savings: Average utility bill reduction: $84
- Payback Period: Break-even point: 16.6 years
- 25-Year Savings: $36,643
Key Takeaways
- Kentucky electricity rates rose 19% from 2020 to 2024, so installing solar in Lexington helps you lock in more predictable, long-term energy costs.
- Lexington homeowners can save around $37,000 over 25 years with solar, and a medium home only needs about a 6.8 kW system.
- Local incentives make going solar easier, including net metering, LG&E/KU Solar Share, and a 20% Solarize Lexington group-purchase discount for Fayette County.
Lexington Electricity Prices
Kentucky’s residential electricity rates rose from 11.5 cents per kWh in 2021 to 13.0 cents per kWh in 2024, according to the U.S. Energy Information Administration. Utilities like Kentucky Utilities serve many Lexington homes.
Solar panel installation in Lexington lets homeowners generate their own power on-site. Instead of relying fully on the grid, you can offset rising utility costs by producing clean energy directly from your roof.
Price of Energy: Kentucky vs National Average
- 2021: KY 11.5¢, US Average 13.7¢
- 2024: KY 13.0¢
Lexington Area Utility Providers
Most Lexington, KY homeowners get their power from Kentucky Utilities (KU). In 2023, KU charged about 12.0¢ per kWh—slightly below Kentucky’s state average of 12.70¢ and well under the national average of 16.0¢.
KU’s below-average rates reflect Kentucky’s historic reliance on affordable, locally sourced coal. Still, rates have climbed steadily as aging infrastructure, fuel costs, and grid upgrades push local electricity bills higher year after year.
Lexington Utilities Electricity Rates
- KU: 12.00¢
- KY Average: 12.70¢
- US Average: 16.0¢
Kentucky Solar Incentives
Several solar incentives in Kentucky can help Lexington homeowners lower the upfront cost of going solar. Here’s what’s available in your area.
| Incentive | Type | Description | Source |
|---|---|---|---|
| Kentucky Net Metering Policy | Net Metering | Kentucky requires most utilities to offer net metering to solar customers. | Learn More |
| LG&E and KU Solar Share Program | Community Solar | LG&E and KU Energy customers can subscribe to shares of a local community solar project. | Learn More |
| Solarize Lexington | Rebate | Homeowners in the Lexington-Fayette County MSA can receive a 20% discount on solar panel installation. | Learn More |
Kentucky Net Metering Policy
Kentucky state law requires all investor-owned utilities (IOUs) and electric cooperatives — excluding the Tennessee Valley Authority (TVA) — to offer net metering to customers with qualifying solar energy systems. The eligible system size has been increased from 30 kW to 45 kW under SB 100, and compensation rates are overseen by the Kentucky Public Service Commission (PSC). Homeowners in Lexington are served by LG&E and KU Energy, which currently offer full retail net metering.
Lexington Solar Irradiance
Solar panel production varies throughout the year based on daylight hours, weather patterns, and sun intensity. Understanding how seasons affect your solar system helps set realistic expectations for your investment.
Solar Production in Lexington by Month
- System Size: 5 kW 7 kW 10 kW
- Daylight Hours Energy Production (kWh/day)
What Can Your Solar System Power?
Summer Production (July)
- Average homes powered: 3.1
- Can run central AC for 15 hours AND power all other appliances
- Fully charge 4.6 Tesla Model 3 electric vehicles
Winter Production (December)
- Average homes powered: 1.4
- Keep home heating system running for 10 hours
- Fully charge 2.2 Tesla Model 3 electric vehicles
Annual Production
- 13,396 kWh/year: Offsets 9 tons of carbon dioxide emissions.
Solar Panel Systems in Lexington
Explore solar installation data and how many of your neighbors in Lexington have made the switch to clean energy.