Iowa Solar Panels Pricing and Incentives

How much do solar panels cost in Iowa?

Written by Jessie See

Edited by Caitlin Ritchie

Last updated 10/25/2022

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Solar power in Iowa

Solar energy is on the rise in Iowa. With more than $700 million dollars invested, Iowa has approximately 510 megawatts (MW) of solar power capacity and more than 8,500 solar systems installed across the state. Additionally, Iowa is home to more than 60 solar companies.

Solar power is a great option for any Iowa homeowner wanting to cut down on monthly energy bills and utilize renewable energy. As solar energy continues to expand in popularity, Iowans can also expect lower installation costs. In fact, solar panel costs in Iowa have dropped 50% in the last 10 years. Along with federal and state incentives that help homeowners offset some of the installation costs, installing home solar panels is becoming more affordable in Iowa.

Iowa solar panel cost

The cost of a home solar system costs on average between $3-5 per watt. The total price of a solar system can range from between $11,160 to $46,500 before factoring in state or federal tax credits or rebates. There are several factors that impact the cost of residential solar systems, including the type, elevation, orientation, size and condition of your roof. Although some brands are more expensive than others, the panels themselves only account for about 30% of the total cost. The remaining costs come from permitting, inspection, wiring, mounting, and labor. The average time it takes to earn back your initial investment in energy savings is between six and nine years.


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Iowa solar panel incentives or rebates

Solar panels are a large investment, so there are several federal, state, and local incentives to make solar power more affordable and accessible. For example, there is a federal solar tax credit offering 30% of the total cost of a solar system back to the consumer. You are eligible for the federal tax credit if you install a solar system on your primary or secondary place of residence between 2022 and 2032. The credit will drop to 26% in 2033 and 22% in 2034 and is set to expire in 2035 unless Congress renews it.

There are also state and local solar incentives offered throughout Iowa. Here are some of the Iowa solar incentives that you may qualify for.

Renewable Energy Equipment ExemptionThis program exempts consumers who purchase a solar panels from paying sales tax on their system. The Iowa sales tax rate is set at 6%.
Property Tax Exemption for Renewable Energy SystemsResidential solar systems can increase the value of your home by $15,000. This Iowa solar program exempts consumers from paying more in property taxes after installing a solar system for 5 years.
IADG Energy Bank Revolving Loan ProgramThis program offers businesses and industries in Iowa a low-interest financing option of up to $300,000 for purchasing and installing solar systems.
Net MeteringIowa offers a net metering program, which lets consumers sell back excess solar energy to the power grid in exchange for credit.
Residential Clean Energy CreditThis federal solar tax credit offers 30% back on taxes to consumers who purchase and install a residential solar system from 2022 to 2032. There is no cap on the amount that you can claim with this tax credit.

Why choose Iowa solar power right now?

There are several reasons why Iowa residents are turning to solar energy to power their homes. Solar technology has improved, the cost of solar panels has decreased, and traditional electricity rates have gone up. A major advantage of solar is the cost savings, but consumers are also drawn towards energy independence and environmental benefits.

Lower energy costs

Although installing a solar system in Iowa requires an initial investment, solar energy has proven to lower energy costs over time. Your monthly energy bill may be lower and in some states, such as Iowa, you can sell extra solar energy back to the power company through net metering programs. Traditional electricity rates have increased in recent years, leading Iowa residents to look for alternative power sources. Iowa tends to have some of the lowest electricity bills in the nation, but consumers could save more on energy costs by powering their home with solar energy instead of paying for electricity from the grid.

Increased energy independence

Homeowners who have installed solar systems take a step towards energy independence. Most solar panel owners choose to remain connected to the power grid so they can pull from the grid when their solar system doesn’t generate as much power. However, many consumers install a solar battery and store excess energy. During periods of high energy demand, you can use energy from your solar battery instead paying higher rates for power from the electricity grid. It is legal to live off-grid in Iowa, so you could choose to completely disconnect from the power grid with an off-grid solar system if you wanted to establish more energy independence.

Go green

Another benefit of switching to solar power in Iowa is that you get to begin the process of going green. Solar energy is a renewable resource that helps reduce the carbon footprint and environmental imprint of your home. On top of your personal clean energy changes, the use of solar energy has an overall positive impact on the planet. In fact, according to the U.S. Energy Information Administration, operational solar energy plants do not produce air pollution or greenhouse gasses unlike other energy sources. Through lowering pollution, solar energy can improve overall health and decrease unnecessary healthcare costs.

Should I buy or lease my solar panels?

One option for obtaining solar energy is by signing a solar lease. Leasing may seem more affordable because of the lower upfront cost, but purchasing your solar panels outright will lead to the greatest savings in the long run. For example, solar panels can increase your home’s resale value by around  $15,000 dollars, which is not the case if you lease your system. There are also federal and state tax incentives that you cannot qualify for if you lease your panels. 

Community solar, solar leases, and solar power purchase agreements (PPAs) expand the availability of solar power to families who cannot afford the upfront cost. With a solar lease, you pay a monthly lease payment which is usually less expensive than a monthly electric bill. Leasing accounts for about 28% of current home solar systems according to the Solar Energy Industries Association. Although you will save on monthly expenses, solar leases can last a couple decades and if you ever decide to sell your home, you will need to find a buyer who can take over your lease.

Iowa solar panel companies

There are several different solar companies in Iowa that offer residential services. If you are considering installing a solar system in your home, SaveOnEnergy can help. We are an independent energy marketplace and partner with top solar companies offering customized solar options. If you are ready to connect with a solar installer in Iowa, fill out this form or call us at 866-420-6556.

The history of solar power in Iowa

Solar energy in Iowa has grown in the last decade. Currently the state has enough solar capacity to power more than 63,000 homes and is projected to add another 1,182 MW of solar capacity in the next five years. Iowa is no stranger to utilizing other renewable energy resources since passing the Property Tax Exemption for Renewable Energy Systems in 1978. Although wind is the most common renewable energy source, there are several solar farms in the state and over $700 million dollars has been invested into the solar industry. Iowa is ranked 32nd in the nation for solar power generation.

Important solar installation factors to consider

Residential solar energy works effectively when the solar system in your home can harness enough of the sun’s power to convert it into electricity. Although solar panels can work in almost any climate, not every home is well-suited to harness the solar power at optimal levels. Based on your location, you should research and consider the following to determine how effective solar panels would work on your home:

  • Roof condition: Everything from the size, position, age, slope and shape of your roof can impact the effectiveness of solar panels. Solar systems will be most efficient on south-facing roofs with slopes of between 15% and 40%. 
  • Weather conditions: On average, Iowa receives 200 sunny days each year, which is just below the U.S. average of 205 sunny days. While solar panels can still generate electricity in indirect sunlight, they will be most efficient when placed on roofs that receive a lot of direct sunlight. If your home is under complete shade, a solar system might not generate enough electricity to power your home. 
  • Neighborhood restrictions and requirements: Even if you have the perfect roof for solar panels and know you get a good amount of sunlight, some HOAs or neighborhood regulations may restrict the installation of solar panels without approval. Be sure to consult your neighborhood’s requirements before installing a solar system.

Solar power FAQs

  • Although the price varies by state and various home factors, the average cost of solar system installation ranges from $11,160 to $46,500, or $3-5 dollars per watt. Although it is not required, the addition of a solar battery will drive up the price. However, this average does not take into account any state or federal tax credits or other financial incentives you may be eligible for that can greatly offset the initial costs. 

  • Whether or not solar power is a good investment for your home will depend on a variety of factors including your home’s location, roof condition, sunlight frequency, and personal energy consumption. However, if your home is a good candidate for a solar system installation, it can end up saving a lot in energy costs over time.

  • The potential savings of converting to solar energy will be different for each homeowner as savings can be influenced by the amount of power you consume monthly and the size of your solar system and the power it generates. In some cases, you may end up producing more energy per month than you consume and can feed it back into the power grid for energy credits later on, greatly reducing your monthly utility costs.

  • Solar power is a great energy option for homeowners looking to reduce their home’s carbon footprint because it is a renewable energy source and does not emit carbon dioxide into the atmosphere. Using solar energy also helps reduce dependency on fossil fuels which are known to emit greenhouse gasses and pollutants into the air and water.

  • There are a variety of solar panel installers operating across Iowa. SaveOnEnergy can help you find a solar company that works for your energy goals and budget. Fill out the form above or call the number on your screen to learn more.

Solar energy by state