Solar Incentives and Rebates in Kentucky (2026): A Plain Look at What Exists

Kentucky has very few solar incentives in 2026. We found no state rebate or state tax credit for home solar, and the federal 25D credit is not allowed for expenditures made after December 31, 2025, so the main financial benefit is the net metering bill credit your utility pays for exported power, which the Kentucky Public Service Commission (PSC) sets utility by utility.

Key takeaways

• We found no current Kentucky state rebate or state income tax credit for residential solar as of November 2026.
• Kentucky law requires utilities to offer net metering for customer-owned systems up to 45 kW, paid as a dollar bill credit at a rate the PSC sets in a rate case.
• 2026 residential export credits we verified: about 7.1 cents per kWh at LG&E, 7.5 cents at Kentucky Utilities and 9.746 cents at Kentucky Power. Duke Energy Kentucky's credit is being recalculated after a June 2026 PSC order.
• Bill credits cannot move to another customer or address, and you lose leftover credits when you close your account.
• Customers of TVA-served utilities in western Kentucky are not covered by the same net metering mandate.

Are there solar incentives in Kentucky?

Kentucky is one of the leaner states for solar incentives. EnergySage's Kentucky guide, updated in January 2026, says the state "doesn't offer many incentives for solar," and our own search of state and utility pages in November 2026 did not turn up a state rebate, a state income tax credit, or a statewide solar property tax exemption for homes.

That does not make solar a bad fit for every Kentucky home. It just means your payback will depend almost entirely on three things: the price you pay, how much solar you use at home, and the export credit your utility gives you. Kentucky's utility prices are on our Kentucky electricity rates page.

Incentive	Status as of November 2026	Notes
State solar rebate	None found	No statewide program located
State income tax credit	None found	Not available for new home systems
Net metering bill credits (KRS 278.466)	Active	Rate set per utility by the PSC
Federal Residential Clean Energy Credit (25D)	Not allowed for expenditures made after December 31, 2025	Applies nationwide
TVA-area utilities	Not required to offer net metering	Some may offer it anyway

Net metering: Kentucky's main solar incentive

Kentucky's net metering law, KRS 278.466, requires retail electric suppliers to offer net metering to eligible customers. The definitions in KRS 278.465 limit eligible systems to 45 kW or less, located on your property, owned and operated by you, and built mainly to supply your own electricity. Solar, wind, biomass or biogas, and hydro all qualify.

Under the current statute, the PSC sets the export rate for each utility through its rate cases. The credit comes as a dollar amount on your bill, and any credit bigger than your bill carries forward to the next one. Utilities may stop accepting new net metering customers once total net metering capacity reaches 1 percent of their single-hour peak load in a calendar year.

For the full mechanics, including grandfathering and how each utility's credit was set, see our guide to net metering in Kentucky.

Kentucky solar export credits by utility in 2026

Because the export rate is the main incentive in Kentucky, it helps to know what your utility currently pays. These are the residential figures we verified in PSC orders and tariffs:

• Louisville Gas and Electric (LG&E): $0.07089 per kWh dollar bill credit under Tariff NMS-2, from the PSC's February 16, 2026 rate order as corrected on March 4, 2026.
• Kentucky Utilities (KU): $0.07534 per kWh under Tariff NMS-2, from the same February 2026 order cycle as corrected on March 4, 2026.
• Duke Energy Kentucky: the PSC's June 1, 2026 order under Rider NM II listed $0.062924 per kWh as the residential value then in effect, rejected Duke's proposed new credit and told Duke to recalculate it and file new tariff sheets. We could not confirm the recalculated figure, so ask Duke for its current Rider NM II rate.
• Kentucky Power: $0.09746 per kWh for residential service under Tariff N.M.S. II (Net Metering Service II), in the tariff effective for service on and after March 1, 2026 after rate case 2025-00257. The rate case kept the credit value the same as the earlier sheet.

Electric cooperatives in central and eastern Kentucky have their own tariffs, so ask your co-op for its current net metering sheet.

Utility and regional programs to know about

We did not find a cash rebate for rooftop solar from LG&E, KU, Duke Energy Kentucky or Kentucky Power when we checked. LG&E and KU do have a Solar Share Program Rider, a separate tariff that the PSC modified in its September 2021 net metering order. It is not a rebate for panels on your own roof.

Western Kentucky is a special case. EnergySage notes that utilities administered by the Tennessee Valley Authority, such as Gibson, Pennyrile, Tri-County, Warren and West Kentucky, are not required to offer net metering, though some may. If your bill comes from one of these, get the utility's distributed generation policy in writing before you buy.

Federal tax credit status for Kentucky solar

The IRS's August 2025 FAQ says the Residential Clean Energy Credit "will not be allowed for any expenditures made after December 31, 2025," and that an expenditure is treated as made when the original installation is completed. So a deposit paid in 2025 does not help a system finished in 2026.

In practice, this means Kentucky homeowners buying in 2026 have no federal or state tax credit to lower the price. Any quote that still lists the credit for a new system should be corrected before you compare it with others.

How to get the most from solar in Kentucky without incentives

When there are no rebates, careful planning matters more. A few steps help:

1. Confirm your utility and its current net metering tariff. Rates differ by several cents per kWh across the state.
2. Size for your own use. Exported power earns a set credit, while power you use directly avoids the full retail price on your bill.
3. Keep your account active. Kentucky law says excess bill credits are not transferable between customers or premises, and no cash refund is paid for leftover credits when you close an account.
4. Plan for a home sale. The installation itself can be transferred to new owners at the same address after notifying the utility.
5. Get several quotes. Run each one through our solar quote checker so you can compare price per watt and contract terms.

Questions to ask before you sign a Kentucky solar contract

With no state program checking prices or paperwork, the burden falls on you as the buyer. These questions help separate solid offers from shaky ones:

• Which net metering tariff will my system go on, and what is the export credit per kWh today?
• Is the system 45 kW or smaller, so it qualifies as an eligible customer-generator under KRS 278.465?
• Does the savings estimate assume a federal tax credit? If so, why, given the IRS end date of December 31, 2025?
• Has my utility reached its 1 percent net metering limit, or is it close?
• Who handles the interconnection paperwork, and what happens if the utility asks for changes?
• What workmanship warranty do you offer, and who services the system if your company closes?

If an installer cannot answer the tariff question clearly, call your utility directly. Kentucky export credits differ enough between utilities that using the wrong number can make payback look years shorter than it really is.

Next steps

Check sun hours and typical system output on our Kentucky solar panels page, then use the solar panel calculator with your utility's export credit to see how long payback might take. Because Kentucky's incentives are thin, a fair installed price is your biggest lever.