Is Solar Worth It in Nebraska? (2024 Homeowner's Guide)

Watch Below: What Should You Know About Recent Changes to the Solar Tax Credit?

How to Figure Out if Solar Panels are Worth It in Nebraska

Determining if your home is a good candidate for solar panels is a complicated process that involves assessing many factors, but it’s a crucial step to take. Below are the metrics you can use to figure out if you and your home will benefit from solar panel installation.

What’s Your Home Electricity Consumption?

First, you’ll want to figure out your home’s average monthly energy consumption. Solar panels provide savings on your electric bills, so if you don’t use enough energy, your savings will be limited, and the panels might never provide a return on investment.

A good benchmark for solar viability is at least 500 kilowatt-hours of energy consumption per month. If you use less than that, your home likely isn’t ideal for solar conversion.

Most homeowners in Nebraska consume well above the national average of kilowatt-hours every month, averaging around 1,013 kWh as opposed to the 881 kWh that’s typical throughout the rest of the country. This also puts most homeowners at more than double the cutoff for solar viability, which means, from a consumption and potential savings standpoint, Nebraskans are in good shape to save by going solar. You can check your energy usage on your past electric bills.

How Much Is It To Go Solar in Nebraska?

The price of solar panels in Nebraska averages around $3.55 per watt, which is well above the national average of $3.33. Most homes in Nebraska need a 10.5-kW system to offset electricity usage, which puts the average total for solar panels in the area at $37,275 before any incentives or $26,093 after the federal tax credit is considered.

Solar is most valuable in areas with above-average electricity prices and usage. While consumption is higher than average in NE, the price of energy is lower than average.

Coupled with the high per-watt price of solar equipment in the Cornhusker State, solar power in Nebraska is less valuable overall than in many other states. With that being said, many solar customers still enjoy plenty of savings — over $18,000, on average — with their solar systems in Nebraska.

What’s the Payback Period for Solar in Nebraska?

The price of solar panels in Nebraska might be high, but residents can rest assured that most home solar systems pay for themselves in time. The time it takes for this payoff to occur is called the solar panel payback period , and it’s one of the best metrics for determining solar viability.

The average payback period in Nebraska is 16 years, with most payoffs occurring in 13 to 19 years. This is well above the national average of 11 years, which, again, means solar is less valuable in Nebraska than in many other states.

However, after your panels pay for themselves, they will continue delivering savings that total $18,399, on average, after the panels are paid off. That’s huge, and it means your panels will provide about a 60% ROI, provided you can take the full federal tax credit.

You can use a solar calculator to estimate your payback period or have a solar installer estimate it for you. If your payback period is longer than 19 years, solar might not be a good investment, although anything under 25 years is expected to provide some kind of return.

What Are Average Buy-Back Rates in Nebraska?

Many states now mandate net metering, which is a massive benefit to solar customers. Via interconnection, net metering lets you overproduce energy with your solar panels and sell the excess to your utility company for a credit to your electric bill.

Net metering reduces your payback period, increases your overall savings and makes solar panel systems much more valuable.

The State of Nebraska does require net metering to be offered by all public utility companies. However, the credit rate per kilowatt-hour is set at the avoided-cost rate, which is well below the retail rate. That means every kWh you produce and export to the grid to pull from later will offset less than 1 kWh later. This is still helpful, but it’s not ideal.

Many customers will want to add a solar battery to their photovoltaic equipment to store energy. Batteries add between $10,000 and $20,000 to your installation costs in most cases, pushing the total in Nebraska to between $47,275 and $57,275 before the tax credit. Solar is already expensive in the state, and with batteries, it could very well be out of the question for many homeowners.

You should speak with a reputable solar installer in your area to see if batteries would benefit you. If they will, a solar loan is a good option for bringing your upfront costs down to $0 while preserving a good portion of those long-term savings.

We should also mention here that net metering programs are in decline throughout the country. In 2024, California rolled out NEM 3.0, which cut the local credit rate by about 75%. Other states are expected to follow suit, and eventually, we expect net metering to be discontinued altogether. If and when that happens, batteries will be a necessity in most areas to see significant savings over time.

That means there likely won’t be a better time to go solar in Nebraska than right now — you can lock in the current net metering rate. Even though the avoided-cost rate used in the state isn’t ideal, it’s far better than nothing.

How Much Sun Does Your Roof Receive?

Solar panels require sunlight to produce electricity, so the more sun your roof receives, the more power you’ll generate and the more savings you’ll enjoy. Nebraska receives around 223 sunny days every year, which is above the national average of 205.

From a sunlight availability standpoint, Nebraska is an excellent place to go solar and better than most in the country. You will also need to assess your individual home for solar viability, as not every property in NE receives the same amount of sunlight.

You should check the direction your roof faces , as south-facing and west-facing roofs receive the most direct sunlight in the US. You will also need to check for shading on your roof from trees or buildings, especially during peak production hours. Any obstructions will reduce your power production and make your panels less valuable.

What’s the Outlook on Solar in Nebraska?

Overall, renewable energy sources are looked on favorably in Nebraska, so solar certainly has its place in the area. However, wind power is currently more prevalent, with more than 10% of the state’s energy coming from wind. ³

Furthermore, Nebraska is one of just a few states that don’t have a Renewable Portfolio Standard (RPS) goal, so it puts few resources behind promoting solar and other clean energy sources. As you might have guessed, the solar incentives in NE are lacking as a result.

However, there are still some incentives for solar panel installation, and residential solar installations have increased significantly over the past decade. The likelihood is that the solar market will continue to increase in the future. Net metering getting downgraded or disappearing altogether will likely occur and slow down the rate of installations

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Benefits of Solar Energy in Nebraska

Installing solar panels in Nebraska will provide you with many benefits, from financial incentives to environmental perks. We’ll discuss some of the most significant benefits of going solar below.

Electricity Bill Savings

Solar panels help you offset or even eliminate your electric bills. Given the average monthly energy expenditure in Nebraska of $125.92, the savings on power bills are the most appealing benefit of solar panel installation.

The potential annual savings is around $1,511, and your solar power system is expected to provide a total savings of $18,399  after the system pays for itself. Your savings could end up being even higher, as electricity rates are expected to continue to increase as they have in the past.

The numbers above are based on current power prices, so yours could be higher if electricity continues to get more expensive. Solar panels effectively let you reduce your energy rates substantially for 25+ years.

Lower Taxes & Access to Other Incentives

Although Nebraska isn’t the most solar-friendly state, the local and federal governments do provide some incentives to make converting to this renewable energy source more appealing. One of the most sought-after benefits is the federal solar tax credit (ITC).

The ITC is a credit to your federal income tax liability for 30% of your total solar panel expense. In Nebraska, the average ITC enjoyed by solar customers is $11,183. Some additional solar incentives in Nebraska are discussed briefly below:

• Property-Assessed Clean Energy (PACE) Financing: PACE loans are a type of solar financing designed to make solar more accessible and affordable to all residents. They include a max interest rate and low down payment requirements to open solar up to more homeowners throughout the state.
• Net Metering: As we mentioned above, net metering is a great policy that helps solar customers reduce their repayment time frame and maximize solar savings. Nebraska’s net metering policy isn’t the best, but it’s certainly helpful.
• Sales and Use Tax Exemption for Community Renewable Energy Projects: This is a sales tax exemption for solar equipment used for community solar projects. While this doesn’t specifically help residential customers installing their own panels, it does make solar more affordable for some in Nebraska.
• Property Tax Exemption for Renewable Energy Generation Facilities: This is a property tax exemption that really only appeals to large commercial solar projects and solar farms. However, it does contribute to lower solar expenses overall in Nebraska.

Home Resale Value Increase

Installing solar panels will significantly boost your home value , making solar conversion a very appealing option for many residents. According to estimates from Zillow, the average home will jump up in value by around 4.1%. ⁴

In Nebraska, where the average property value is around $245,663, most homeowners will see a value increase of around $10,072. ⁵ This dollar amount could be much higher in more expensive areas, like Omaha and Lincoln.

The bump in home value provided by a solar PV system is only expected if you acquire your panels with a cash purchase or solar loan. A major downside of solar leases and power purchase agreements (PPAs) is that they will not have a positive impact on your home value.

The increase in property value could also be more substantial if you install batteries with your systems. Nebraska sees its fair share of extreme weather, so the savings and the insulation from blackouts that batteries provide in the area are likely to appeal to buyers.

Clean, Renewable Energy

Most homeowners will also find the environmental benefits of going solar enticing as well. Installing solar panels and producing your own energy increases your energy independence, reduces your contribution to pollution and global warming and makes you less reliant on fossil fuels. Overall, solar panels make you and your home far more eco-friendly.

What to Look Out For When Considering Solar in Nebraska

Although confirming that your home is a good candidate for a solar panel system is a crucial first step, there are other things you’ll need to consider in your journey toward solar conversion. We’ll discuss these additional important factors below.

Upfront Fees

The upfront fees of going solar will always be essential to factor in, especially in Nebraska, where the average price of solar equipment is higher than the national average. One of the best ways to keep initial fees down is by choosing a loan that has a small down payment requirement or none at all.

Nebraskans have access to PACE financing, which should help. You can also choose cheaper solar panel brands and avoid add-on products like solar batteries to keep your upfront investment low.

Payback Period

Your estimated solar panel payback period is one of the most crucial metrics to use, not only to determine the value of solar on your property but also your estimated long-term savings. Most Nebraskans have a payback period of between 13 and 19 years, with an average of 16 years.

If your payback period is longer than 19 years but under 25 years, you’ll still save money over time, but your return on investment might not make the investment worth it for you.

Net Metering Policies in Nebraska

The State of Nebraska mandates net metering for all public utilities, but it doesn’t require any specific buy-back rate. As a result, many utility companies offer a rate that’s well below the retail rate for energy, so be sure to check with your provider before you agree to anything.

While this is still better than no net metering policy, customers who want to eliminate their energy bills or maximize their savings will likely have to install a solar battery as well. This will increase installation expenses significantly — usually between $10,000 and $20,000 — but often pays for itself over time.

Pending Policies & Changes to Incentives

Policies and incentives are always subject to change as the solar industry matures in Nebraska. Some policies could disappear, new rebate programs could pop up and existing incentives could be altered to be better or worse for solar customers.

It’s important to note that it will likely reduce your overall savings to wait for better incentives to come along, but you should absolutely check for updates before signing solar contracts.

Weather & Climate in Nebraska

Solar panels are most efficient near the equator, where the sunlight is most intense. As such, homeowners in Nebraska often worry that the northern location of the state will mean sunlight isn’t available enough to make solar profitable.

Although the sun’s intensity is lower in NE than in many other states, residents experience 223 sunny days per year, which is usually plenty of sunlight to make solar worth it and well above the national average.

Other Nebraska residents are concerned about the state’s location in Tornado Alley and the threat of damage to their solar systems during extreme weather. Tornadoes can damage solar equipment, but choosing a solar panel installation company that provides a good warranty is often enough to provide ample peace of mind.

Companies Pushing Solar Leases or PPAs

Finally, you should be very careful when choosing a solar installer to tackle your installation project. Some solar companies in Nebraska don’t have your best interests at heart.

One of the primary examples of this is companies advertising “ free solar panels .” Solar panels are never really free, and these installers are usually just pushing solar leases.

Solar leases aren’t ideal, as they don’t let you take the ITC, they don’t increase your home value and they take far longer to pay off, reducing your overall return on investment. There have been local reports from Omaha Public Power District (OPPD) of disingenuous solar companies in the Omaha area that are using aggressive sales tactics to push solar leases on customers. ⁵

We will note that leases and PPAs are sometimes beneficial, especially in high-cost areas like Nebraska where batteries are also more common due to the below-retail net metering credit rate. We don’t mean to say that these financing options should never be used, just that companies that push them as the be-all-end-all solution for solar are not being entirely forthcoming with you.

There have also been reports of inexperienced solar companies causing residents to lose thousands and sometimes tens of thousands of dollars throughout Nebraska. ⁶ You should always work with reputable and vetted solar installers to avoid these issues and other scams.

Wrap Up: Is Solar Worth it in Nebraska?

For most Nebraska homeowners, installing solar panels is an excellent option that saves quite a lot of money — $18,399, on average — over time. However, solar panels aren’t suitable for every home, so we recommend using the guide above to help you determine if solar is a good option for your property.

Some things you’ll want to consider include the direction your roof faces, shading on your property, your estimated solar panel payback period, the solar array size required and the price of the panels. We suggest reaching out to a reliable solar installer to help you decide if you’d benefit from solar conversion if you’re unsure.

See also: Calculate how much you can save by going solar

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Read More About Going Solar

• What Are the Best Solar Companies in Nebraska?
• What Nebraska Solar Incentives Are Available?
• Find Cost Savings on Solar in Nebraska

The cost information presented in this article is derived from a comprehensive analysis, incorporating data from multiple industry sources. The average cost per watt per state was calculated based on figures from Consumer Affairs, Energy Sage, and Berkeley Lab’s Electricity Markets & Policy Department. Additionally, monthly energy consumption and the average monthly cost of electricity were sourced from the U.S. Energy Information Administration, ensuring a well-rounded and accurate representation of the information presented.