Your 2020 guide to getting solar panels for your home in Nebraska
This page is a complete guide to the complicated and sometimes confusing process of installing solar panels on your Nebraska home. Since there's a lot to consider, we've separated the page into sections to help you find what you are looking for. If you find this page useful, please share it with someone who might also find it interesting!
** What's new for 2020 **
If you live in the Lincoln and Omaha areas, here’s some good news. Your utility company allows net metering to give you credits for sending your solar power back into the grid and make it pretty easy to interconnect. Lincoln Electric continues to offer some rebates. However, without stronger rules protecting that net billing arrangement, the current climate could shift and homeowners who want to install solar could be S.O.L.
Seriously, though, Nebraska is a beautiful state with lots of natural bounty to protect. But when even residents of one of the state’s most forward-thinking city have shown tepid interest in supporting solar, where is the legislature, which with a few simple laws can spark a solar revolution in Nebraska like we’ve seen in other states? Read on to learn what's needed for the home solar industry to really take off here.
Questions? Our network of solar experts are on call to assist you. Simply sign up for personalized assistance on our special solar deals page. You can get discounted on-grid pricing as low as $4,000/kW! This is paired with the Nebraska solar incentives you see below.
What you'll find on this page:
The Solar Strategy section is focused on the 3 ways of paying for solar in Nebraska, so you can decide which is best for you. We've created a tool that asks you a few questions and recommends whether you should pursue a solar lease, loan, or outright purchase. Then, we provide detailed analysis of how each works.
The Policy Information section contains all our latest research on the rules set by lawmakers and the Public Utilities Commission, which determine how easy it is to go solar in Nebraska. These policies and rules govern everything from renewable energy mandates to interconnection, and have a huge effect on the viability of solar.
Finally, the Solar Incentives section includes information about money-back rebates and grants, tax credits, and tax exemptions for going solar in Nebraska.
Click any of the boxes below to go to that section of the page, or scroll down to read the page in order.
|Your Nebraska Solar Strategy|
|Comparing Solar Investment Options|
|Paying Cash for Solar in Nebraska|
|Solar Loans in Nebraska|
|Solar PPAs in Nebraska|
|Solar Purchase Payback Time in Nebraska|
|Nebraska Solar Policy Information|
|Renewable Portfolio Standard (RPS)|
|RPS Solar Carve-Out|
Your Solar Strategy in Nebraska
Figuring out the best way to go solar in Nebraska can be a little daunting. From loans and leases to power-purchase agreements, there are a lot of options out there. To help you pick the one that might be best, we've created the handy decision tool below.
We'll ask you a few simple questions about you and your home. Once you're done, we'll recommend a good option. Further down this page, we provide cost estimates and example return-on-investment calculations for all the various options:
How to pay for solar panels in Nebraska
The chart above shows the 25-year returns for an investment in solar whether you choose to purchase a system with cash or pay over time with a loan. As you can see, Nebraska has the potential for some financial returns, but not a lot. The purchase option leads to the highest dollar-amount returns over time, but the solar loan option gets you the monetary benefits up front and stretches the costs over the long term.
Look, we're not going to lie to you here. The financial picture for solar in Nebraska is just not that great. If you're a committed environmentalist or a do-it-yourselfer who can cut the costs to install in half, you'll see some benefits. Otherwise, maybe advocate with your state reps to get some good solar policy on the docket for next legislative session.
Read more below about each of these two options for solar in Nebraska.
Option 1: Paying cash for solar
An outright purchase used to be the only way to get solar, and it's still the option that provides the 'biggest' financial returns. The reason we put 'biggest' in quotes here is because it's technically true. You'll see a net return of almost $10,500 in 25 years if you pay up front. But it requires a significant up-front investment.
If you have equity in your home or good credit, you can get a solar loan or HELOC with an interest rate of 4% or less. It's like being able to start a business that is sure to succeed, just by having a roof. Read about loans below.
If you've got cash and you prefer to pay up front, you'll have to plunk down $26,840. But by the end of year 1, incentives and energy savings will erase a bunch of it. Over 25 years, your system will have produced about $10,500 in income. Solar offsets enough of your energy bill to save you about $916 in year 1, and it just goes up from there. As the electric company raises rates, you save more and more, and more...
Here’s how the numbers pencil out when you pay up front for a 8.8-kW rooftop solar system:
- Installing a typical 8.8-kW solar system should start at about $26,840. That's cheaper than solar has ever been, but it still might seem like a big investment. Don’t worry, because after tax breaks and energy savings, your first-year costs will be considerably less than that.
- The Feds calculate their incentive based on actual out of pocket costs, so take 26% of $26,840, for a tax credit of $6,978. Your total investment is now down to just $19,862.
- After the tax credit we subtract your first year’s energy savings, which we estimate to be $916. That reduces your cost after the first year to only $18,939.
- Your system will pay for itself in just 6 years, and over its 25-year life, you'll see a total net profit of $10,519. The internal rate of return for this investment is a stupendous 3.5%!
- And don't forget... your home's value just increased by around $10,700, too (the next present value of your invesment in solar)!
- In addition to all that cash (and home value), you’ve created some green for the earth as well by not using electricity from fossil fuels. It's like planting 343 trees a year, every year your solar power system is humming.
Keep in mind, the numbers above are based on an average home in Nebraska. If you're ready for a custom quote for a solar panel system, our network of experts are on call to assist you. Simply sign up for personalized assistance on our special solar deals page.
Option 2: Using a loan to pay for solar
You don't need $27,000 sitting around to pay for solar. As long as you have equity in your home, you can still own solar panels and reap all the benefits. Heck, even if you do have the cash, getting a loan to pay for solar is by far the best option when it comes to percentage return on investment.
That’s because, in the USA, using a loan to pay for solar earns you a big tax break. Your tax savings will be huge in the first year—more than enough to offset the small difference between the loan payments and electric bill savings. That means you'll be able to reap the savings now and pay over time whle your energy bill savings cover some of the cost of the loan.
A solar purchase like this will make sense for you if the following is true about you and your current situation:
- You can qualify for a solar loan or home-equity line of credit (HELOC) for $26,840, with a fixed rate of 4% or lower and a 15-year repayment period. Don't be put off if you're offered a higher rate. It just means a tiny bit less of the thousands of dollars you'll make with solar.
- You love making money without much risk.
Here’s how the numbers pencil out for a Nebraska solar purchase with a loan:
- Installing a typical 8.8-kW solar system should start at about $26,840. That's how big your loan will need to be to cover it.
- The electricity you'll save in the first year of operation would have cost $916, but your annual loan payments will be $2,464, meaning you would spend $1,547 on solar this year, but...
- You'll also see a huge tax break. The Feds give you 26% of the cost of your system back as a tax credit, which in this case is $6,978 You'll be paying over time but getting all the benefits up front!
- The electricity savings will continue for 25 years, while your loan payments will last only 15. By the end of the 25-year life of your panels, you'll come out $401 ahead. Not a sterling investment, but it works out if your a staunch environmentalist.
- On top of the green that will stay in your pocket, your system will mean green for the environment, too. 343 trees-worth, every year!
Keep in mind, the numbers above are based on an average home in Nebraska. If you're ready for a custom quote for a solar loan, our network of experts are on call to assist you. Simply sign up for personalized assistance on our special solar deals page.
Option 3: Buying the electricity, not the panels with a Power Purchase Agreement (PPA)
Nebraska does not offer solar Power Purchase Agreements or leases. Perhaps it would be a good idea to contact a solar advocacy organization and ask them to fight for solar in your state!
Nebraska Solar Policy Information
Ever wonder why solar seems to be everywhere in some states, but not in others? We did too.
State legislatures and public utilities commissions can enact rules to make solar power accessible for everyone. Favorable rules explain why some of the cloudiest states—New York, New Jersey, and Connecticut, are doing so well with solar, and yet some of those with the most natural solar resources—like Alabama, Mississippi, and Georgia—are doing so poorly.
Below is important information about the public policy, rules, and economic reasons that affect your ability to go solar here in Nebraska:
Nebraska's Renewable Portfolio Standard
A Renewables Portfolio Standard (“RPS”) requires utilities in the state to eventually source at least a certain percentage of their electricity from clean, renewable sources like solar panels.
An RPS would be critical to strong renewable energy policy in Nebraska. Utility companies aren't really all that gung-ho about you producing your own power. After all, it costs them money when you use less of their electricity. They also don’t naturally want to give you big payments for energy you're feeding back into the grid. The main reason the utilities would aid your transition to lower electric bills and offer you incentives to put solar on your roof would be if the state forces them to. Without an RPS, utilities have little incentive to help homeowners go solar.
Nebraska's Solar carve-out and SRECs
The best states for solar mandate that a certain percentage of the RPS comes directly from solar energy. Without a mandatory RPS in Nebraska, this is another area that falls short. If an RPS contains specific carve-outs for clean and efficient technologies like solar panels, or mandates for environmentally necessary increases in distributed generation, you see even stronger incentives for residential solar power.
Nebraska Electricity Prices
Nebraska pays an average of a 11 cents per kilowatt-hour(kWh) for electricity. That’s quite a bit lower than the national average of 13.6 cents. We know you love paying low bills for electricity, but there’s a big reason why energy is so cheap. It’s because most of our electricity still comes from burning millions of tons of fossil fuels.
The cost of those fossil fuels in dollars and cents may be low (for now), but the environmental costs are astronomically high. New regulations on carbon emissions and dwindling supplies will likely drive the cost up over the next few decades. But while everyone else is paying through the nose for the fuels of the past, you’ll be rocking that sweet, shiny solar power system on your roof, and making money! Just remember to thank us.
Nebraska Net Metering
Net Metering requires your utility to monitor how much energy your solar power system produces and how much energy you actually consume, and make sure you get credit for the surplus.
Nebraska requires all electric utilities to offer something called "net metering," but it doesn't meet the full definition of the term. All monthly surplus energy production (also called "net excess generation, or NEG") is applied as a credit to your next bill at whatever the utility decides is fair. Net metering is available for all solar power systems up to 25 kW in capacity on a first-come first-serve basis until net-metered systems reach a total of 1% of a utility’s peak electricity demand during the previous year.
Unfortunately, that leaves Nebraskans without a clear picture of how much they can save with solar. NEG varies from month to month, and is usally high in the summer and non-existant in the winter. In a state with full net metering, that ebb-and-flow allows you to size your solar system to meet your full annual usage and simply save credit for the excess until you need it. In Nebraska, you've got to size your system just right to be economical.
Luckliy, the experts at system sizing are the installers we know. If you're in Lincoln, Omaha, or anywhere else, connect with solar installers near you to see how much you could save with solar!
Nebraska Interconnection Rules
The Cornhusker state has interconnection standards, but they're... not amazing. Nebraska's Interconnection rules require system owners to pay for interconnection equipment (other than a net meter), and interconnection is guaranteed only for systems up to 25 kW.
On the plus side, according to the rules, utilities "may not require a customer-generator to... (p)urchase additional liability insurance if all safety and interconnection requirements are met." So you've got that going for you.
In plain English, you're probably fine here. Let your installer take care of the utility company paperwork and understand that a small fraction of your final cost for the system will be from fees incurred to perform the interconnection. We'd prefer a more robust standard here, but what Nebraska offers is enough to guarantee you'll be able to hook into the power grid with your solar system.
Nebraska Solar Incentives
Next to high electricity prices and net metering, solar incentives have traditionally been the most important factor for whether home solar power makes financial sense in a state. In the past, some states with otherwise lousy policy had tremendous incentives that drove down the up-front cost of going solar so much that homeowners could save oodles of money even without net metering or a good RPS.
These days, the big incentive most people can get is the Federal Solar Tax Credit that earns you 26% of your total system costs back after just 1 year. State incentives play less of a role than in the past, but some really good ones are still out there, ready to help homeowners go solar and save money before you know it.
Let's see how Nebraska measures up:
The availability of state solar incentives for residential solar systems was sourced from the Database of State Incentives for Renewables and Efficiency, utility company websites, and the state public utility commission.
Nebraska Solar Power Rebates
Like we said, no RPS almost always means no big cash incentives to support solar power. That’s generally the here, too. Lincoln Electric used to offer a small rebate program, but as of 2018, it appears to be over.
We hate to harp on a point, but let’s do it anyway. An RPS is the most efficient and effective way to kickstart strong utility-backed incentives! Utility-backed, i.e., paid for by the utilities. That’s a win-win so far as lawmakers in Lincoln and Nebraskan homeowners are concerned, right?
Nebraska Solar Tax Credits
$0.0005/kWh for 10 years
We’ll give credit where credit is due. The state legislature’s hearts are in the right place by passing a tax credit to support renewable energy. Unfortunately effort is about all lawmakers get credit for here, because the credit is so small as to be nearly meaningless. From 2013 on, Nebraskans get .05 cents ($.0005) per kilowatt-hour of electricity they produce. How much does that come out to in a year? You can look forward to a state tax credit of about $3.41 a year. Thanks, we guess?
Property Tax Exemption
Statewide, large systems only
Nebraska has a property tax exemption for solar facilities, but they must be greater than 100-kW in size, which eliminates pretty much all residential installations. Well, if you live in one of these mansions you might be able to cram 100 kW of panels up there.
Sales Tax Exemption
A sales tax exemption would save you 5.5% up-front ($1,100 on the sort of average 5kW residential system we use in our example below). We think both exemptions should be passed asap, of course, but the property tax exemption in particular is a sensible way to save you tons of cash without ever withdrawing a single penny from the state’s coffers. Oh but hey, you can get a sales tax refund if you spend $20,000,000 on a solar installation.
Low-income Solar Programs
Grade: FLearn more about low-income solar programs available in the U.S.
The consensus on Nebraska solar power rebates and incentives
It’s about time for Nebraska to get with the program on solar energy. One small utility offering tiny incentives is not enough. The state’s agricultural base needs clean power to survive. So does its wealth of cultural and natural history. Legislators have to step up to the plate or ride off into the sunset. Nebraska has beautiful wide-open spaces, so let’s fill the legislative open space with solar power incentives.
Again, if you are confused about how these numbers work and would like some personalized assistance or a quote of your own, simply connect with our network of solar experts. They’ll help sort out all the pricing, get you access to special deals, and they’re super friendly to boot!