Kansas Solar Power: Check Your Savings, Costs, Tax Breaks, Incentives and Rebates
Kansas has a lot of sunlight available during the year for homeowners who invest in a residential solar PV system.
The west of the state can receive up to six peak-sun hours per day on average, which is comparable to the sunshine in California, home land of solar Los angeles king one of the top cities for solar power.
Having a lot of sunlight is great, because it basically means getting more dollars out of your PV system over its lifetime for every dollar invested at the beginning.
Another strong point in favor of solar power in Kansas is that the local net metering policy requires private utility companies to give you full credit for every kilowatt-hour of energy you export to the grid. This means that you get full savings from the output of your residential PV system, even if you don’t consume it at the moment.
You are also exempt on property tax when you go solar, which means your home will be worth more but you will still pay the same taxes as before!
Return on Investment for Residential Solar Power in Kansas
Most homes can accommodate a 5-kilowatt solar PV system with ease, and it is a system size that offers a great balance between upfront cost and savings.
To provide with an idea on what to expect if you go solar in Kansas, let’s break down the financials for when you install a PV system of that size at your home.
- Before incentives of any type, the average upfront cost is $21,000. - However, the 30% investment tax credit from the federal government reduces this by around $6,300, which comes off the taxes you pay on your next declaration. - On top of that, you will save nearly $900 on energy expenses during the first year thanks to the generous amounts of sunlight available. - The combination of the federal tax credit and first-year savings brings down the outlay over the first year of PV system ownership below $14,000. - You can expect a payback period of around 14 years. - Your home will now be worth $18,000 more! - The environmental benefit is significant, equivalent to planting more than 120 trees per year for as long as you use the PV system.
- Before incentives of any type, the average upfront cost is $21,000.
- However, the 30% investment tax credit from the federal government reduces this by around $6,300, which comes off the taxes you pay on your next declaration.
- On top of that, you will save nearly $900 on energy expenses during the first year thanks to the generous amounts of sunlight available.
- The combination of the federal tax credit and first-year savings brings down the outlay over the first year of PV system ownership below $14,000.
- You can expect a payback period of around 14 years.
- Your home will now be worth $18,000 more!
- The environmental benefit is significant, equivalent to planting more than 120 trees per year for as long as you use the PV system.
The energy prices in Kansas are low, at $0.13/kWh on average, and that is the main factor that extends the payback period of solar PV systems. However, those low prices are available thanks to fossil fuels, and solar power can still save you cash while being friendlier with the environment.
After the payback period, you can expect to get more than a full decade of free and green energy, reaping nearly $20,000 in total profits. Also, the energy prices could rise if more stringent regulations for fossil fuels are placed, and in that case you will save even more cash without making your PV system larger.
Remember that this is a general scenario for a 5-kilowatt system subject to the average conditions in the state of Kansas; every project will be different in terms of performance due to site-specific conditions. For a more accurate scenario that will fit your personal circumstances with recommend you visit our solar calculator page here.
- A south-facing rooftop, because that is the general direction from which most of the sunlight comes during the year. - No significant obstacles blocking the incident sunlight. - A location in western Kansas, where most of the sunlight is.
- A south-facing rooftop, because that is the general direction from which most of the sunlight comes during the year.
- No significant obstacles blocking the incident sunlight.
- A location in western Kansas, where most of the sunlight is.
These conditions are optimal but not mandatory: you can still save a lot of money from solar power if you don’t meet them exactly.
The NASA Atmospheric Science Data Center is a great resource where you can input your coordinates to get a detailed breakdown of the available sunlight during the year, on a month by month basis as well as by yearly average values.
Kansas Solar Power Incentives, Tax Breaks and Rebates
In addition to all of the sunlight available, the two main incentives for going solar in Kansas are the 30% tax credit from the federal government and the property tax exemption from the local government.
The net metering policy is also great, since you get full credit for any kWh that is exported to the power grid; you don’t have to worry losing potential savings if your PV system overproduces energy during the summer!
Unfortunately, there are no rebates for solar power in Kansas, and the main cause of this is a weak Renewable Portfolio Standard.
Although the RPS requires utilities to obtain 20% their power from renewable sources by the year 2020, the goal is voluntary.
Kansas Tax Credit
While there are no state-specific tax credits in Kansas, the 30% federal tax credit takes off a huge portion of your initial expenses as soon as your next tax declaration is filed.
The great thing about this tax credit is that it applies regardless of your purchase method: you can go solar with zero upfront cash by taking a loan and still get a huge tax credit, even if you haven’t paid a single dollar for your PV system yet.
Kansas Tax Exemption
Thankfully, Kansas has a property tax exemption for solar power. This means that you won’t pay more taxes on your property even when a solar PV system drives up its value by around $18,000.
Solar power in Kansas is only exempt from the property tax; the sales tax is applied normally when you purchase a residential PV system.
Kansas Electricity Rates
The electricity in Kansas is cheap, but not environmentally-friendly since there are various power plants running on fossil fuels throughout the state.
On average you will pay $0.13/kWh by purchasing energy from local utilities, but by going solar you will save nearly $20,000 over the service life of the PV system.
On top of that, the environmental benefit will be equivalent to planting over 120 trees per year.
Is There Net Metering in Kansas?
Kansas has a great net metering policy: If you produce a surplus of energy from your solar PV system during a given month, the utility company is required to give you full credit for all those kilowatt-hours exported to the grid.
The only drawback about the net metering policy in Kansas is that utilities are not forced to carry over the credits indefinitely, and after 12 months you lose them. However, this will not be an issue if you size your solar PV system properly; it is just a matter of not going overboard.
Another important issue to point out is that cooperatives and state-owned utilities are not forced to comply with this policy, so net metering may be unavailable in those cases, or the rules may be different.
Despite the favorable net metering policy, there is no standard interconnection policy for solar power, so each utility company sets its own requirements.
Are There $0 Down Payment Financing Options in Kansas?
Leasing and Power Purchase Agreements are not available in Kansas, so the only feasible option for going solar with 0 down financing and to get a low-interest HELOC (home equity line of credit).
The main advantage of purchasing a solar PV system through a loan is that you will pay for your system over 10 to 15 years, but will get back 30% of its cost in less than one year in the form of a tax credit.
In other words, you will reach positive cash flow right away, and all of that money that would have otherwise been paid in taxes will be available to cover the first few loan payments.
You are essentially getting a tax credit on a purchase you haven’t paid yet!
Keep in mind that interest will consume a portion of the lifetime savings from your solar PV system if you go solar through a loan.
Cash Purchase VS Loan: What’s Best for Kansas Homeowners?
The choice between a cash purchase and a loan comes down to cash availability, payback period you are willing to assume, and the amount of equity owned in your home.
Purchasing a PV system in cash
Purchasing a PV system in Kansas in cash is the option if you are able and willing to pay the full price of the solar PV system upfront, and then assume a 14-year payback period, to gain an extra $9,000 in savings over 25 years.
Purchasing a PV system through a loan
Purchasing a PV system in Kansas through a loan is recommended if you have access to a HELOC with excellent terms and are unwilling to assume upfront expenses and a long payback.
You only get around 55% of the savings available from the cash purchase, but you get positive cash flow right away.
What is the Solar Power Installation Process in Kansas?
Kansas does not have an interconnection policy for solar power, so requirements can be complex and vary by electric utility.
If you have already decided to go solar, we recommend you get in touch with one of the contractors we trust.
1. Fill our solar installation form, providing basic information on your property.
2. Talk with trusted solar contractors near you to get accurate quotes.
3. Compare quotes (we recommend you get at least three) and choose the best option for you.
4. Have your contractor install the PV system, and enjoy clean power while helping the planet.
This article is for a 5-kW system under the average conditions for the state of Kansas. However, each home is unique and conditions for solar power will vary.
A trusted solar installer can provide you with a detailed proposal, and once you sign the agreement the installation takes from three to four days.
Kansas is rich in sunlight, the net metering policy allows you to maximize your solar energy savings, and you have the 30% federal tax credit and the property tax exemption to ease up your PV system ownership costs.
The outlook would be better with a strong RPS and solar rebates, but residential solar power is already a sound investment with the benefits available.
In the absence of solar leases and PPAs, going solar comes down to deciding between a cash purchase and a loan, preferably a low-interest HELOC.
The first option involves assuming a large initial investment and a long payback to maximize savings, while the second one gives up part of the savings to make the project available at $0 down.