Welcome to the 2017 Wisconsin solar power information page
Note: The numbers above are just estimates for a 5kW solar system, and your home is unique. The best way to know exactly how much money solar power can save you is to connect with one of our partners nearby. A friendly solar expert we trust will give you a buzz and help you craft a personal plan to get the absolute most out of a solar power system for your home. It's 100% free (yes, that’s right, 100% free) and you aren't obligated to buy anything.
Some may call it Dairyland, but folks here in the Badger State know that Wisconsin has a whole lot more to offer than its cheese. From the mighty Mississippi in the west to big ol’ Lake Superior in the north and everything in between, Wisconsin offers some of the most beautiful environments anywhere in the nation (and a few-thousand more lakes than that state just a little bit to the west). An astonishing 46% of the state is covered by forest, including the 1.5 million acre Chequamegon-Nicolet National Forest. Needless to say, Wisconsin has a great deal to protect by promoting green energy. So how is solar policy doing out here? Let’s look.
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 $4,500/kW! This is paired with the Wisconsin solar incentives you see below.
Your guide to going solar in Wisconsin
We've designed this page to be a complete guide to the complicated and sometimes confusing process of installing solar panels on a home in Wisconsin. Since there's a lot of important information 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!
The Solar Strategy section is all about the various financial options you have in Wisconsin. We've created a tool that asks you a few questions about what you hope to get out of a solar purchase and recommends whether you should pursue a solar lease, loan, or outright purchase. Then, we give you a detailed picture of how each could work for you.
The Policy Information section contains all of our latest research on the rules set by the state legislature and public utilities commission that determines how easy it is to go solar in Wisconsin. These policies and rules govern everything from renewable energy mandates to whether you get paid retail or wholesale rates for the extra energy your system produces, and can have a huge effect on the viability of solar.
Finally, the Solar Incentives section lists all of the available financial benefits available to homeowners who go solar. This section includes information about money-back rebates and grants, tax credits, and tax exemptions. If you're looking for what Wisconsin is doing to make solar more affordable for its citizens, you'll find it here.
Click any of the boxes below to go to that section of the page, or scroll down to read the page in order.
|Your Wisconsin Solar Strategy|
|Comparing Solar Investment Options|
|Buying Solar in Wisconsin|
|Wisconsin Solar Loans|
|Smaller Solar Systems in Wisconsin|
|Solar Purchase Payback Time in Wisconsin|
|Wisconsin Solar Policy Information|
|Renewable Portfolio Standard (RPS)|
|RPS Solar Carve-Out|
Your Solar Strategy in Wisconsin
Figuring out the best way to go solar in Wisconsin 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:
Compare the Return of Different Solar Investments in Wisconsin
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. All those bars going in different directions might look a little complicated, so let's break it down:
The green bars show the return if you pay up front for a 5-kW solar system. As you can see, there's a big payment (negative) in year 1, which gets slowly reduced over time. The green bars cross the "$0" line at year 13, which is when the system will have paid back your initial investment with electricity savings. Then, our example goes to year 25 (which is when most solar panel warranties end), where you'll end up with just about $19,000 in total profits. Not bad! That's because Wisconsinites enjoy a mix of above-average energy prices and enough daily sun to make the electricity savings substantial.
The orange bars, on the other hand, show what happens if you take a Home-Equity Line of Credit (HELOC) to pay for the same 5-kW system. You don't put any money down, but you do get the 30% Federal solar tax credit, meaning you actually come out several thousand dollars ahead in year 1. The bars dip below the $0 line after 6 years, because your loan payments (over a 15-year term) will exceed your energy savings by a little each year. Still, once you pay off the loan, the savings start stacking up quickly. In the end, you'll come out thousands of dollars ahead over the 25-year estimate.
Finally, the blue bars represent a similar HELOC option, but for a smaller, 2-kW solar system. This size system is great if you only have a little equity, and it still saves you thousands in the long term, while reducing the amount of CO2 pollution you're responsible for. The loan size is smaller and so are the first-year windfall and final profits, but if you love the idea of solar, this is a great way to go.
Keep in mind that these numbers are estimated for Wisconsin residents who qualify for rebates though the state's Focus on Energy program, which serves most—but not all—of the state. The best way to see if you qualify for the rebates is to connect with one of our partners in Wisconsin to get help with paperwork and make sure you get all the solar incentive money that you can.
Read on to find out more about each option!
Buying Solar in Wisconsin
Paying up front used to be the only way to get panels on your roof, and it's still the option that allows you the most control. But it isn't the best option from a percentage return on investment standpoint—that award goes to the solar loan.
Still, an outright purchase returns the most money over time, because you own the system from day one and reap all the benefits—the state rebate, the Federal solar tax credit, and some nice energy bill savings.
In our example, you put down $17,600, but by the end of year 1, that tax credit and the energy savings will erase a bunch of it. Over 25 years, your system will have produced almost $19,000 in income.
Here’s an example of how the numbers work for a purchase of a 5-kW rooftop solar system in Wisconsin:
- Installing a typical 5-kW solar system should start at about $17,600 after the Focus on Energy rebate.
- The Feds offer a tax credit of 30% of out-of-pocket costs, so you'll get $4,560 back next April. Note: you can take the credit over two years if you don't owe $4,560 in Federal taxes this year.
- Then there's your first-year energy savings. That's another $819, and it brings the cost after 1 year to just $12,221.
- With all the energy bill savings rolling in, your system will pay itself back after 13 years. Once that happens, you’ll be seeing over $1,200 per year in savings until the end of your system’s life.
- When all is said and done, our 25-year estimate shows a total net profit of $18,860 with an internal rate of return of 7.9%. That's basically the same as a high-performing stock index fund, and it has the added benefit of helping the environment!
- On top of those returns, your home's value just increased by $16,380, too (your expected electricity savings over 20 years)!
- And speaking of doing good for the environment... your system will create some green for the earth by not using electricity from fossil-fuels. In fact, the energy you’re not using has the carbon equivalent of planting 106 trees a year, every year your solar power system is humming.
Keep in mind, the numbers above are based on an average home in Wisconsin. 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.
Solar Loans in Wisconsin
This is where we tell you that taking a loan for solar panels is a no-brainer, because it means investing in an income-generating asset. It's true! That's because the state gets a nice amount of sunshine, so even without huge incentives, it's enough to make solar worthwhile, generating a good deal of income for you after you pay your loan off.
Here's the important stuff:
As you can see from the chart above, you'll start out with a big windfall, because with a loan, you're not putting any money down, and you get the federal tax credit just like if you paid $17,600 up front for your system. You'll come out $3,709 ahead after the first year! In the 14 years that follow, your loan payments will actually cost a little more than the money you'll be saving in electricity, but just think of it like a monthly deposit into a savings account.
The rest of our estimate might look like a see-saw, because you start out with a windfall, drop down into "decent-sized investment" territory, and then rocket up again after the loan is paid off. That's when the solar "savings account" will pay dividends. You'll be saving tons of money every year because you'll own the system outright. At the end of our 25-year example, you'll be $11,408 to the good, which is great for an investment where you put nothing down!
A solar purchase like this will make sense for you if the following is true about you and your current situation:
- You can get a home-equity line of credit (HELOC) for $17,600 with a fixed rate of 5% or lower and a 15-year repayment period.
- You have an appetite for making a little money with a long-term investment, while also producing benefits for the environment.
Here’s how the numbers pencil out for a Wisconsin solar purchase with a HELOC:
- Installing a typical 5-kW solar system should start at about $17,600, after the state rebate. That's how big your loan will need to be to cover it.
- The electricity bill savings in the first year of operation will total $819, but your loan payments will be $1,670, for a difference of $851, or about $71 per month.
- But here comes the tax credit! Because you've technically "paid" for the system with your loan, you'll get the Federal tax credit of 30% of system costs, or $4,560! Even after you make those loan payments, you'll end up with an extra $3,709 at the end of the first year.
- When your loan’s paid off in year 15, you’ll see over $1,400 per year in savings until the end of your system’s life.
- For our 25-year estimate, you'll see pretty nice returns, to the tune of $11,408 after all the payments. That's a huge amount of money for a zero-down investment!
- Finally, the environmental benefits cannot be overstated. Operating your system will take as much carbon out of the air as planting 106 trees every year!
Keep in mind, the numbers above are based on an average home in Wisconsin. 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.
Small Rooftop Systems in Wisconsin
Let's say you don't have a ton of extra cash laying around, but you do have a bit of equity in your home. Can you get solar panels? YES! Is it a good idea in Wisconsin? Oh yeah! You'll take out a small loan that will be repaid with low monthly payments, and your electricity savings and tax credit will result in big savings. You'll end up with a little profit over 25 years, and you'll also help take a lot of carbon out of the air!
Here are the factors we'll look at for this example:
- A 2-kW rooftop system that will cost around $7,800 installed (after rebate).
- A HELOC for that amount with a 15-year payback at 5% interest.
Here’s how the numbers pencil out for a Wisconsin purchase of a small rooftop solar system:
- Installing a typical 2-kW solar system should cost about $7,800. Your loan should be for this amount.
- You'll gain $328 in electricity savings in the first year of operation, while your loan payments will cost $740. That's a net cost to you of $412, but...
- At the end of the year, the Federal government will give you a tax credit of 30% of the cost of your system. That's $2,340 that you won't owe this year. You can take the Federal credit over two years if you don't owe that much in taxes this year. Here's how that looks:
- First-year electric bill savings: $328
- - First-year loan payments: $740
- = First-year cost of solar: -$412
- + First year federal tax credit: $2,340
- Total in your pocket after year 1: $1,928
- Your loan payments will exceed your electricity savings while you pay off the loan, by about $33 per month. But when your loan’s paid off in year 15, you’ll see upwards of $550 per year in savings until the end of your system’s life.
- For our 25-year estimate, you'll end up with some pretty decent profits! We're talking $3,997 after 25 years, all without putting any money down. That should help your old, wiser self appreciate your young, forward-thinking self.
- Your system will remove as much carbon from the air as planting 42 trees per year, which is a pretty great thing, we'd say.
Keep in mind, the numbers above are based on an average home in Wisconsin. 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.
Wisconsin 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 Florida—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 Wisconsin:
10% by 2015 (met)
A Renewables Portfolio Standard (“RPS”) is a law requiring a certain percentage of a state's energy production comes from renewable resources by a target date in the future. Wisconsin was on board with a statewide RPS, under which 10% of statewide electricity production must have come from renewable sources by 2015, otherwise the utility companies needed to pay massive fees.
It's laudable that Wisconsin had such an early goal, but the state easily mat the 10% requirement way back in 2013, and there are no future plans to increase that 10% requirement.
A strong RPS with high targets is the core of all good renewable energy policy. Without mandatory renewable energy production levels, utility companies have no motivation to promote conversion to renewable energy sources like residential solar power system. With a strong RPS, it becomes cheaper for the utilities to help fund your solar power system than to pay penalties for missing RPS goals. That’s when you really see incentives kick in.
In short, a strong RPS is generally the single most effective law that state legislators can implement to promote renewable energy. Without a new commitment to a stronger RPS, Wisconsin will not be a solar leader in the future.
What's an RPS? Your state legislature paves the way for strong solar energy incentives to flourish by setting standards for renewable energy generation within their territories. Those standards are called the state’s renewable portfolio standard (RPS). If utility companies do not meet these standards, they must pay alternative compliance fees directly to the state. Many utilities then determine the best ways to source their energy from renewable sources that are less expensive than this fee.
An RPS is a mandate that says "Hey utilities! Y'all now have to make a certain percentage of your electricity from renewable sources. If not, you'll have to pay us huge fines." The consequences are good, because utilities usually try to meet these RPS standards by creating solar power incentives for you, the homeowner. Read more about Renewable Portfolio Standards.
RPS solar carve out
The best states for solar have not only aggressive RPS goals, but also specific goals (i.e. "carve-outs") for solar use. A solar carve-out is a great way to get utility companies even more interested in helping homeowners get solar, but Wisconsin lags behind the best solar states in this category.
What's a solar set aside? A solar set aside guarantees a specific portion of the overall renewable energy mix generated comes from the sun. For those states with progressive standards, high alternative compliance payments, and clear solar carve outs, the faster those areas become ripe for solar.
Some states have higher alternative compliance fees than others, and some states have more progressive alternative energy standards and deadlines than others do.
For instance, New Jersey has an overall RPS of 22.5% by the year 2021. That requires local utilities to source 22.5% of their energy mix from renewable sources by the year 2021. Pretty good. However, New Jersey also has a specific solar set aside of 4.1% by 2028. That’s the type of firm commitment which really gets the industry rolling forward. No wonder why New Jersey is one of the hottest solar markets right now!
Wisconsin Electricity Prices
Wisconsin pays an average of 14 cents per kilowatt-hour (“kWh”) of electricity, meaning a 5-kW solar system will save you about $800 a year here. Energy costs in the state from traditional sources are a bit higher the national average of 13 cents/kWh, but still pretty cheap. Too cheap, in fact.
Electricity is relatively inexpensive because most of it still comes from dangerous amounts 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. Switching to solar power already saves you money, but when scarcity and environmental costs drive up fossil-fuel based energy prices, the early switch to solar power is going to be saving you piles and piles of money.
Why are electricity prices so important? Because that is what solar power is directly competing against. The cost to produce power with solar is relatively constant (of course how much sun hits your area has an effect), so if you are paying $0.40 per watt for power, then you make FOUR TIMES AS MUCH as the guy or girl paying $0.10 per watt electricity.
The caveat here is that if the $0.10 per watt person has a HUGE rebate, they may be better off than the $0.40 per watt person. Because of that, states without any renewable standards tend to be heavily reliant on cheap coal for electricity, and also have very low electricity prices. When electricity prices are artificially low, that hinders the ability of solar energy to achieve meaningful payback in the state.
Wisconsin Net Metering
Net metering requires your utility to monitor how much energy your solar power system produces and how much energy you actually consume. If you produce a surplus, you get credit for it on your bill.
Net metering in Wisconsin is a bit scattered, but generally strong for residential customers. All investor-owned and municipal utilities are required to offer a net metering program, but electric cooperatives are exempt from the requirement. So, most utilities offer net metering, but there is a bit of variation among how the programs are implemented. Generally, all surplus kWh are credited at your retail electric rate, and applied to the next bill. If credit exceeds $25, the utility must cut you a check for the amount.
One way or another, you’re getting credit for all that extra energy at a pretty decent rate per kWh. Overall we gave net metering in Wisconsin a C because of system size limitations that prevent larger customers from efficiently meeting all on-site needs with renewable energy, and the law’s lack of a safe harbor provision that ensures the utility can’t charge you extra fees for net metering. But for a residential solar power system like yours, net metering is pretty solid here.
What is net metering? Net metering is the billing arrangement where you can sell excess electricity back to your utility for equal the amount you are charged to consume it. The more customer friendly net metering policies, the higher the grade.
The grade here specifically reflects individual solar system capacity, caps on program capacity limits, restrictions on “rollover” of kWh from one month to the next (yep just like cell phone minutes), metering issues (like charges for new meters), Renewable Energy Credit (REC) ownership, eligible customers and technology (the more renewables the better), being able to aggregate meters across the property for net metering, and safe harbor provisions to protect customers from solar tariff changes.
Wisconsin Interconnection Rules
Wisconsin’s interconnection standards are more of a mixed bag. Your residential system is small enough (less than 20 kW) to avoid any fees for reviews or studies. That’s great. Unfortunately, the money saved there will be spent purchasing insurance coverage, and installing a redundant external disconnect switch.
And of course, if you’d like some personalized assistance, get in touch with us and we’ll have an expert contact you in a jiffy.
Interconnection rules are a little technical, but they basically allow you to “plug in” to the electric grid with solar panels on your roof. The more complex, out of date, or nonsensical the state rules are for plugging into the grid, the lower the grade.
Specifically, the grade reflects what technologies are eligible, individual system capacity, removing interconnection process complexity for smaller systems, interconnection timelines and charges, engineering charges, prohibiting the requirement of unnecessary external disconnects, certification, spot interconnection vs. wide area interconnection, technical screens, friendliness of legalese, insurance requirements, dispute resolution, and rule coverage.
Solar Incentives in Wisconsin
Wisconsin Solar Power Rebates
$600/kW, up to $2,400
The statewide Focus on Energy program launched in July, 2012, and is ongoing. Homeowners whose utility company participates (most of them do) are eligible for up to a $2,400 rebate after they install a qualifying solar electric system. This solar rebate is a great way to help homeowners defray the costs of installation, but this rebate is a little smaller than those in the best solar states.
How do solar rebates work? Similar to getting a rebate card from your local big box store for a dishwasher purchase, state legislatures also provide rebates for solar panel purchases to spur on investment and create new jobs. If you purchase the solar panel system yourself, you qualify for this free cash, which many times is a lump payment back to you. Some solar installers like to take this amount directly off the total installed price, and they'll handle the paperwork for you to make things a lot less complex.
The availability of state and utility rebates were sourced from the Database of State Incentives for Renewables and Energy Efficiency. The better the rebates, the higher the grade.
Wisconsin Solar Power Tax Credits
Wisconsin does not offer any tax credits to promote renewable energy.
About state solar tax credits: State tax credits are not technically free money. However, they are 'credits' and not 'deductions' which means that if you have the tax appetite to take advantage of them, then they can be a 1-to-1 dollar amount off your taxes instead of a fraction of the cost of the system. So that means they can be an important factor to consider. In certain circumstances, state tax credits can provide a very powerful incentive for people to go solar.
(Keep in mind, we are not tax professionals and give no tax advice so please consult a professional before acting on anything we say related to taxes)
The availability of personal tax credits for solar energy were sourced from the Database of State Incentives for Renewables and Energy Efficiency. The higher the tax credit amount, the higher the grade.
Solar Power Performance Payments
Up to $0.30/kWh
A couple years back, customers of two Wisconsin utilities were eligible to participate in solar power buyback programs, also known as parallel generation agreements. These are not true performance payments; you continue to purchase electricity from the utility at the normal retail rate, while selling all of the energy produced by your solar power system.
Madison Gas and Electric and River Falls Municipal Utilities have both offered the programs, but in both cases, the programs are "fully subscribed," that is, you can't sign up for them.
This is one of those areas that would be helped by a stronger RPS law in Wisconsin. With some aggressive goals for solar adoption, utility companies would have an incentive to pay homeowners for the solar energy they produce. Without those goals, Wisconsin will continue to lag behind in the solar race.
Explanation of performance payments: Performance payments represent a big chunk of the financial rationale for going solar, and in many instances they make your decision a wise one. For certain states, if you’ve got solar panels on your roof, not only will you be cutting your electric bill down to size, but you'll be getting paid additional cash from your utility company. Pretty awesome, huh? Not only are you generating electricity for yourself, freezing your own popsicles with sun, and feeling like you’re doing something smart for your children or any of the other 4 reasons people go solar, but you are getting PAID!
Utility companies are paying people with solar panels on their roofs because their states say they have to, otherwise they will pay a fee. Therefore, the payment amount to homeowners is typically a little bit less than the amount they would be billed for by the state. For states with these alternative compliance fees, Solar Renewable Energy Credit (SREC) exchanges have popped up. In the above chart, we outlined an estimate of yearly payments a homeowner might expect from the utility company for the SREC credits from their solar energy system.
Expected SREC payments were calculated by using the latest trade values in the SRECtrade database. The availability of feed-in tariffs were sourced from the Database of State Incentives for Renewables and Energy Efficiency. The higher the expected monthly payments, the higher the grade.
If you don’t know what an SREC is, or how they work, check out this great SREC video
Property Tax Exemption
Fortunately there are tax exemptions to help bring down the cost of your solar power system. You’re exempt from 100% of the property taxes normally associated with with the big increase in home value you’re going to get from installing a solar power system. (we’ll get to that below).
About solar property tax exemptions: Property tax exemption status is a pretty big factor when putting together your investment considerations. Many argue that solar power adds approximately 20 times your annual electricity bill savings (if you are owning the system and not leasing. Leasing still has a positive impact on the ability to sell your home though, in our opinion).
For many average-sized solar power systems on a house, that can mean $20,000 to your home value. (Edit April, 2014: Some companies, like Solar Mosaic, are starting to offer traditional style equity-based home loans for such a thing). An additional $20,000 in property tax basis in many states amounts to a big chunk of change owed back to the state. However, many states have complete exemptions from added taxes when you install solar on your home!
The availability of a property tax exemption for solar energy was also sourced from the Database of State Incentives for Renewables and Energy Efficiency. The stronger the tax exemption, the higher the grade.
Sales Tax Exemption
With Wisconsin’s sales tax exemption for solar systems, you save 5-5.6% right off the bat.
What's the deal with solar power sales tax exemptions? When states give you a sales tax break on solar, we notice. You should too. State sales tax exemption status for the purchase of solar energy systems were sourced from the Database of State Incentives for Renewables and Energy Efficiency. Sales tax exemptions, if present, were all 100%. A handful of states are completely exempt from sales tax regardless, and therefore received ‘A’ grades by default (OR, DE, MT, AK, and NH).
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The consensus on Wisconsin solar power rebates and incentives
Wisconsin is something of a mixed bag when it comes to solar. The statewide rebate program and tax incentives are a good start, but there’s no statewide policy that defines how homeowners should be paid by utilities, making each utility’s policies unique, and not as clear as a strong standard. If the legislature and the governor could agree on a more robust renewable energy standard with a big chunk dedicated to solar electricity generation and better rebates and tax credits, Wisconsin could take its place among the best states for solar. Still, the good policy, especially the RPS and tax exemptions, earn Wisconsin a strong B+. On, Wisconsin!