Is Solar Worth It in Indiana in 2026?
Complete analysis of solar costs, incentives, net metering, and payback for Indiana homeowners — without the federal ITC.
Cost Per Watt
$2.80
installed
Electricity Rate
$0.158
per kWh
Payback (No ITC)
14 yr
current reality
Payback (With 30% ITC)
9.8 yr
hypothetical
25-Year ROI
78%
return on investment
Incentive Breakdown — Indiana
Available incentives for a typical 7kW residential solar system in Indiana
Federal ITC (25D)
ExpiredThe federal solar Investment Tax Credit expired on January 1, 2026. No federal credit available for new installations.
State Tax Credit
NoneIndiana does not offer a state tax credit for solar installations.
SREC Market
Not AvailableIndiana does not have a traditional SREC market.
Property Tax Exemption
Solar system value excluded from property tax assessment
Sales Tax Exemption
No statewide sales tax exemption for solar
Key Incentives: Property tax exemption for solar.
Solar Math — With vs Without Federal ITC
Cost breakdown for a typical 7kW residential system in Indiana
2026 Reality (No Federal ITC)
- System Size
- 7 kW
- Cost per Watt
- $2.80/W
- Gross Cost
- $19,600
- Federal ITC
- $0
- Net Cost
- $19,600
- Annual Savings
- $1,399/yr
- Payback Period
- 14 years
Hypothetical (With 30% ITC)
- System Size
- 7 kW
- Cost per Watt
- $2.80/W
- Gross Cost
- $19,600
- Federal ITC (30%)
- -$5,880
- Net Cost
- $13,720
- Annual Savings
- $1,399/yr
- Payback Period
- 9.8 years
Impact: Without the federal ITC, Indiana homeowners face a 4.2-year longer payback period — paying $5,880 more out of pocket.
Net Metering Policy — Indiana
How Indiana compensates your excess solar production
Reduced export credits or net billing — you earn less than retail for excess solar. Moderate impact on payback.
Indiana transitioned to excess distributed generation (EDG) credits at a rate lower than full retail, approximately $0.03-0.05/kWh.
Cost Per Watt Benchmark — Indiana
Indiana Average
$2.80/W
National Average
$3.05/W
Typical 7kW System
$19,600
Indiana's average installed cost is below the national average of $3.05/W
Breakeven Timeline
Without the federal ITC, a typical 7kW system in Indiana breaks even in 14.0 years. With the former 30% ITC, payback would drop to 9.8 years.
Without Federal ITC
14
years to break even
With Former 30% ITC
9.8
years to break even
Production Details
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