Missouri Solar Incentives: Tax Credits & Rebates Guide (2022)

Do your energy bills just seem to keep rising and rising? If you’re looking to give your wallet a break and you live in Missouri, you should look into purchasing a new solar energy system for your home. Now is an excellent time to buy solar energy systems because there have never been as many tax credits and rebates available to lower the costs associated with your purchase.

Although the initial cost of installing solar panels may appear scary, payback periods generally last less than ten years, and you can experience savings for up to 25 years. Keep reading to learn all about how your purchase and installation of solar panels in Missouri can be made more financially accessible.

Why Go Solar in Missouri?

While there are many reasons to buy solar panels for residents of any state, Missouri is a particularly great state in which to purchase and install a solar energy system on your property. Solar energy production has been expanding and improving over the past decade in Missouri, and it is now a great time for homeowners to get in on this up-and-coming electricity source.

It has also never been cheaper to buy solar panels in Missouri, thanks to the state government’s implementation of several incentive programs to encourage the adoption of solar energy production among industrial, commercial, and residential property owners. Because solar policies in Missouri have begun encouraging the purchase of solar energy systems, it’s very likely that the Missouri solar market will continue to grow for years to come.

Solar panels are a valuable means of generating electricity where sunlight is abundant. Missouri receives nearly 206 sunny days per year, which is one day above the national average of 205 days. The wealth of sunshine in Missouri should only further incentivize you to go solar because solar panels prove to be highly efficient in sunny climates. Plus, installing solar panels will reduce your reliance on fossil fuels, reduce your carbon footprint, and ultimately help mitigate the onset of climate change.

Finally, solar panels can make your home far more valuable. According to Zillow, the average home experiences a 4.1% increase in its value after the addition of a solar power system. This means that, with an average home value of $217,345 in Missouri, the average value increase from solar panels will be close to $8,911.

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Missouri Solar Cost

The average cost of a solar panel installation in Missouri ranges from $11,730 to $15,870. On a cost-per-watt basis, solar panel installation in Missouri falls between $2.35 and $3.17. These costs have dropped considerably in recent years.

How Much Can You Save on Solar in Missouri?

You can save lots of money on your electricity bills when you purchase solar panels in Missouri. When solar panels produce electricity for your home, they can reduce the amount of energy that you pull from the grid, thus lowering your bills. With average electricity rates in Missouri around $0.12/kilowatt-hour (kWh), homeowners can save $53,100 over a 20-year period by installing a 5kW solar system. These energy savings are helped by the fact solar panels can last more than 25 years before needing to be replaced.

The Best Solar Incentives, Tax Credits, & Rebates in Missouri

There are multiple public and private incentives in Missouri that can help you save on your purchase of solar panels:

Federal Solar Investment Tax Credit (ITC)

The Federal Solar Investment Tax Credit (ITC) is a 26% federal tax credit available for purchased home solar systems installed before December 31st, 2022. Homeowners can apply this credit to their personal income taxes, making it a great incentive available to all Americans, no matter where they live. The American solar industry has grown by more than 10,000% since the ITC was enacted in 2006, creating hundreds of thousands of jobs and bringing billions of dollars into the American economy.

Missouri Solar Property Tax Exemption

The Missouri Solar Property Tax Exemption excludes the added value of a solar installation in Missouri from your home’s value for tax purposes. Because solar panels regularly increase the value of your home, this tax exemption is a great way of avoiding having to pay taxes on your home’s heightened value.

Missouri Net Metering

Missouri passed a law in 2007 that requires all electric utilities to offer “true net metering” to customers with solar PV systems up to 100 kW. This policy means that your solar panels will be connected to the public-utility power grid, and surplus power created by your panels will be transferred to the grid. You can offset the cost of power drawn from the electricity grid as a result of net metering. The minimum amount of compensation that you’ll receive is the avoided-cost rate, which is below the retail rate. While the policy specifics of net metering programs will vary among providers, this remains massively beneficial for solar owners.

Utility Solar Rebate Program

A number of utility companies offer rebates for installing photovoltaic (PV) systems (solar energy systems):

• Kansas City Power & Light Solar Rebate: If you are a customer of Kansas City Power & Light, you may be eligible for a rebate of $0.25 per watt of solar power installed on your home.
• Ameren Missouri Solar PV Rebate Program: If you live in or near St. Louis, you’re probably an Ameren Missouri customer. If you are, you are most likely eligible for a rebate for installing a solar energy system. Although the size of the rebate depends on the size of your system, you can receive $0.25/watt upfront, which amounts to $2,625 in savings for the typical 10.5-kW system.
• Columbia Water & Light Solar Rebates: If you are a customer of Columbia Water & and Light Electric Company, you can earn a rebate of $375 to $625 per kilowatt of solar power generation for systems less than 10 kW. You may also be eligible for a rebate between $300 and $500 for systems between 10 and 50 kW. Finally, you can get a $400 rebate for installing a qualifying solar water heater.
• Liberty Utilities Solar Rebate: Like the Ameren incentive, Liberty Utilities offers customers a very similar rebate plan. This means you could be eligible for a rebate of up to $0.25 per watt for your installation of a solar energy system if you are a customer of Liberty Utilities.

Property Assessed Clean Energy (PACE) Program

The state of Missouri offers access to financing for energy-efficient power systems and upgrades through the Ygrene™ PACE financing program. You may be eligible to receive this assistance if your energy projects include solar, HVAC, lighting, energy controls, roofing, or windows. Moreover, Set the PACE St. Louis, a program only available to St. Louis residents, offers 100% upfront, fixed-rate, long-term financing for qualified energy upgrades, including energy efficiency, water efficiency, and renewable energy systems.

Commercial Missouri Solar Incentives

Solar Incentives for Nonprofits and Businesses in Missouri

Unfortunately, the state of Missouri does not offer financial incentives specific to nonprofits or businesses. However, your business may be eligible for many of the residential financial incentives.

USDA REAP Grant

The United States Department of Agriculture (USDA) has created a program designed to increase investments in clean energy called the Rural Energy for America Program (REAP). REAP assists agricultural producers and rural small businesses reduce their energy costs and consumption by providing loan financing and grant funding to purchase and install renewable energy systems. Eligible participants in the REAP program are agricultural producers, with at least 50 percent of their gross income coming from agricultural operations and small businesses in eligible rural areas.

State Sales Tax Credit

The state of Missouri does not offer sales tax credits for the purchase of solar energy systems.

Key Takeaways: The Best Missouri Solar Incentives

Missouri is a great state to invest in residential, commercial, or industrial solar energy systems, especially because the state has implemented a renewable portfolio standard (RPS). An RPS is a regulatory mandate to increase the production of renewable energy such as wind, solar, biomass, and other alternatives to fossil fuels. Because of its RPS, Missouri is committed to growing its solar industry.

With financial assistance from the federal government, the state government, and additional local incentives, Missouri residents have a great deal of support to draw from when purchasing solar panels. The time is right to get into the solar game, with utility prices soaring and the cost of solar energy dropping fast. If you are interested in purchasing, there are many great companies that will help get you set up.

House Method’s Solar Companies Rating Methodology

At House Method, transparency and trust are our most important values for the reader. That’s why we took the time to create an objective rating system and score each solar energy company/service according to our methodology.

Our research team dug deep into the fine print of contracts, combed through more than one hundred customer reviews, and thoroughly investigated all of each solar energy company’s services, costs, and products. We’ve done the homework for you by researching nearly all of the solar energy companies on the market so you can have the information you need to make the best choice for your home.

We developed a formula to objectively determine the best solar energy companies and give each a score out of 100 based on the following criteria:

• Plan Options (30): Do they provide a variety of plan options? We looked at the number of plans each solar energy company offered and the flexibility of adjusting the plan.
• Services offered (20): How many services are offered in each plan? We looked at whether the company manufactures its own solar panels, whether it contracts out installation, and what additional products each company offers.
• Trust (10): What do customers say after their solar panels are installed? Does this company offer a guarantee? We considered how satisfied customers are post-service if the company does what it says it will, BBB accreditation, and service guarantees.
• Prices (10): How reasonable are the costs of the plan or service in comparison to the industry average? We compared the costs of each company to competitors that offer the same solar energy services.
• Unique perks (10): Does the company offer discounts or special services such as financial incentives, rebates, or a useful mobile app? We looked for extras each company offers that set them apart from the competition.
• Customer Service (10): How is the customer experience when contacting the company? We considered the speed of response, weekend/holiday availability, and ease of communication through phone calls, email, and online chat functions.
• Nationwide availability (10): How many states does the company offer its services? Companies that operate nationally and in all zip codes are favored over those with limited availability.