Is solar worth it in Indiana?
For a typical Indiana home in 2026, solar is not worth it: about a 16.9-year payback and $9,567 saved over 25 years after paying for the system. Check your own home, because roofs, usage and utilities vary a lot.
- Payback, typical home
- 16.9 yrs4.2 kW, paying cash
- Electricity price
- 16.9¢per kWh, U.S. 18.0¢
- Solar production
- 1,330kWh per kW per year
- Exports credited at
- ~32%Reduced export credit
The numbers for a typical Indiana home
| Electricity use | 931 kWh a month (Indiana average) |
|---|---|
| Best-value system | 4.2 kW, producing 5,584 kWh a year (50% of use) |
| Price | $14,210 at about $3.05/W |
| First-year savings | $776 |
| Payback | 16.9 years |
| 25-year net | $9,567 (3.9% a year return) |
| Rate increase assumed | 3.3% a year, from Indiana's 2015–2025 history |
Paying cash, no federal credit, 5% discount rate, microinverters, $25 per kW a year for maintenance and repairs. Methodology.
Why it comes out this way
- Electricity costs 16.9¢ per kWh, close to the U.S. average of 18.0¢.
- Exported solar is typically credited at about 32% of retail, so systems pay best when sized for what you use yourself.
- A typical system here produces about 1,330 kWh per kW per year (ranked #33 of 51).
- There is no federal tax credit for homeowners who buy in 2026, which adds several years to payback compared with 2025.
Net metering and export rules in Indiana
Reduced export credit. Indiana ended net metering for new customers in mid-2022. Under 'Excess Distributed Generation' (EDG) billing, solar you use at home offsets retail, but any electricity sent to the grid is credited at about 1.25 times the utility's wholesale energy price (AES Indiana: about 5.4 cents/kWh as of July 2026).
EDG rate = average marginal energy price paid by the utility in the prior calendar year x 1.25 (IC 8-1-40-17), updated annually by each IOU. Exports measured instantaneously via a separate meter channel.
- Netting: instantaneous
- Unused credits: EDG dollar credits carry forward indefinitely while the customer stays on the rider; forfeited on account closure.
- System size limit: 1000 kW
- Fixed charges: Minimum monthly charge applies; EDG credits can't reduce bill below it.
- Last major change: SEA 309 (2017); EDG took effect for new systems July 1, 2022 (AES July 2022, others earlier/later per approvals). IN Supreme Court upheld instantaneous-netting interpretation (2023).
Read net metering explained to see why export rules can swing payback by years.
| Utility | Export credit | Notes |
|---|---|---|
| AES Indiana | 5.4325¢/kWh | Rider 16 EDG rate 5.4325 cents/kWh effective July 27, 2026 (Cause 46258). |
| Duke Energy Indiana | Reduced export credit | EDG rider; rate updated annually (not verified, likely ~4-6 cents). |
| NIPSCO | Reduced export credit | EDG rider; rate not verified. |
| Indiana Michigan Power | Reduced export credit | EDG rider; rate not verified. |
Solar incentives in Indiana
The federal 30% Residential Clean Energy Credit ended for systems installed after December 31, 2025. What that means.
| Program | Type | What you get | Status |
|---|---|---|---|
| Renewable energy property tax deduction | property tax exemption | Deduction from assessed value for solar energy systems (IC 6-1.1-12-26 and related). Eligibility: Property owners who file with county auditor. | active |
What solar costs in Indiana
A fair cash price is around $3.05 per watt before incentives. For the 4.2 kW system that fits a typical home, expect roughly $10,900 to $15,400; smaller systems cost more per watt.
How many homes have solar
- Homes with net-metered solar (2025)
- 11,490
- Share of homes
- 0.4%
- Residential solar capacity
- 121 MW
- Growth over the past year
- +9.1%
Sources: EIA-861 (2025), EIA small-scale solar estimates, LBNL Tracking the Sun and state interconnection data.
Electric utilities in Indiana
| Utility | Homes served | Price (2026 est.) | Typical use | Typical-home verdict |
|---|---|---|---|---|
| Duke Energy Indiana | 808,572 | 15.9¢ | 992 kWh/mo | Not worth it |
| AES Indiana | 469,634 | 15.6¢ | 941 kWh/mo | Not worth it |
| Northern Indiana Pub Serv | 433,889 | 23.4¢ | 672 kWh/mo | Close call |
| Indiana Michigan Power | 425,007 | 18.2¢ | 848 kWh/mo | Not worth it |
| Southern Indiana Gas & Electric | 134,700 | 21.0¢ | 895 kWh/mo | Close call |
| Hendricks County Rural E M C | 38,554 | 14.5¢ | 1,211 kWh/mo | Not worth it |
| South Central Indiana REMC | 35,216 | 18.6¢ | 1,133 kWh/mo | Close call |
| Northeastern Rural E M C | 31,034 | 16.4¢ | 1,026 kWh/mo | Not worth it |
| City of Anderson | 29,600 | 13.5¢ | 852 kWh/mo | Not worth it |
| Tipmont Rural Electric Member | 29,540 | 17.4¢ | 996 kWh/mo | Close call |
| Johnson County Rural E M C | 29,132 | 14.3¢ | 1,121 kWh/mo | Not worth it |
| Clark County Rural E M C | 27,707 | 15.2¢ | 1,247 kWh/mo | Not worth it |
| Southeastern Indiana R E M C | 26,271 | 16.6¢ | 1,206 kWh/mo | Close call |
| City of Mishawaka | 25,180 | 13.1¢ | 613 kWh/mo | Not worth it |
| Jackson County Rural E M C | 24,354 | 15.3¢ | 1,344 kWh/mo | Not worth it |
| Harrison County Rural E M C | 23,482 | 14.4¢ | 1,333 kWh/mo | Not worth it |
| Boone County Rural EMC | 19,224 | 16.8¢ | 1,255 kWh/mo | Close call |
| Utilities Dist-Western IN REMC | 19,049 | 16.6¢ | 1,125 kWh/mo | Not worth it |
| Kankakee Valley Rural E M C | 19,027 | 15.6¢ | 986 kWh/mo | Not worth it |
| NineStar Connect | 18,751 | 17.5¢ | 1,258 kWh/mo | Close call |
| Heartland REMC | 18,144 | 15.4¢ | 1,237 kWh/mo | Not worth it |
| Kosciusko County Rural E M C | 17,473 | 13.9¢ | 929 kWh/mo | Not worth it |
| City of Richmond | 16,253 | 13.2¢ | 961 kWh/mo | Not worth it |
| Western Indiana Energy REMC | 15,012 | 15.6¢ | 1,231 kWh/mo | Not worth it |
| Carroll-White REMC | 14,853 | 16.4¢ | 1,106 kWh/mo | Not worth it |
Solar by city in Indiana
- Indianapolis18-yr payback · Not worth it
- Fort Wayne16.9-yr payback · Not worth it
- Evansville13.8-yr payback · Close call
- South Bend16.7-yr payback · Not worth it
- Fishers17.9-yr payback · Not worth it
- Carmel18.2-yr payback · Not worth it
- Bloomington18-yr payback · Not worth it
- Hammond14.1-yr payback · Close call
- Noblesville17.8-yr payback · Not worth it
- Lafayette17.7-yr payback · Not worth it
- Gary14-yr payback · Close call
- Greenwood17.7-yr payback · Not worth it
- Muncie16.5-yr payback · Close call
- Kokomo18.1-yr payback · Not worth it
- Terre Haute17.8-yr payback · Not worth it
- Anderson16.4-yr payback · Close call
- Westfield18-yr payback · Not worth it
- Elkhart16.7-yr payback · Not worth it
- Columbus18-yr payback · Not worth it
- Jeffersonville17.8-yr payback · Not worth it
- Mishawaka16.7-yr payback · Not worth it
- Lawrence18-yr payback · Not worth it
- West Lafayette17.7-yr payback · Not worth it
- Portage14-yr payback · Close call
- New Albany17.8-yr payback · Not worth it
- Merrillville14.2-yr payback · Close call
- Plainfield17.9-yr payback · Not worth it
- Richmond21-yr payback · Not worth it
- Valparaiso14-yr payback · Close call
- Goshen16.7-yr payback · Not worth it
- Crown Point14-yr payback · Close call
- Zionsville17.9-yr payback · Not worth it
- Michigan City14.3-yr payback · Close call
- Brownsburg18.1-yr payback · Not worth it
- Granger17-yr payback · Not worth it
- Schererville14-yr payback · Close call
- Hobart14-yr payback · Close call
- Marion16.7-yr payback · Not worth it
- Franklin17.7-yr payback · Not worth it
- East Chicago14.1-yr payback · Close call
Protect yourself when buying
- Check the license. No statewide electrical or solar contractor license; licensing handled by local jurisdictions (city/county). Look up an installer
- Cancellation rights. Federal law gives you 3 business days to cancel most door-to-door sales over $25. How to cancel
- HOA and solar access. Limited: solar easements authorized; no strong HOA ban prohibition (verify).
- Community solar. No statewide community solar program.
Questions about solar in Indiana
Is solar worth it in Indiana in 2026?
For a typical Indiana home, solar is not worth it. A 4.2 kW system costing about $14,210 after state incentives saves about $776 in the first year and pays back in about 16.9 years. Your result depends on your roof, usage, utility and price, so run the calculator for your address.
How much do solar panels cost in Indiana?
A reasonable cash price is around $3.05 per watt before incentives, or roughly $10,900 to $15,400 for a 4.2 kW system.
Does Indiana have net metering?
Indiana ended net metering for new customers in mid-2022. Under 'Excess Distributed Generation' (EDG) billing, solar you use at home offsets retail, but any electricity sent to the grid is credited at about 1.25 times the utility's wholesale energy price (AES Indiana: about 5.4 cents/kWh as of July 2026).
Is there a solar tax credit in Indiana?
The 30% federal credit for homeowners ended for systems installed after 2025. Indiana does not offer a state income tax credit for solar that we're aware of. Solar may be exempt from property tax.
How do I check a solar installer's license in Indiana?
No statewide electrical or solar contractor license; licensing handled by local jurisdictions (city/county).. Look up any installer with the state's license search at https://www.in.gov/pla/.
Policy research current as of October 2026; sources include aesindiana.com, energybot.com, programs.dsireusa.org. Electricity data: EIA, through July 2026. Found something out of date? Tell us.