Indiana Solar Panels

Indiana Code § 6-1.1-12-26 guarantees that any increase in your home’s assessed value due to a solar installation is completely excluded from your property tax assessment. This means you can enjoy the full financial and energy benefits of going solar without paying a single dollar more in property taxes — regardless of how much value the system adds to your home. On average, Indiana homeowners save an estimated $124 per year through this exemption.

The exemption applies to all residential and commercial solar energy systems installed after December 31, 2011. To claim it, property owners must complete Form 18865 (Renewable Energy Property Tax Deduction) and submit it to their local county auditor’s office. The exemption does not require annual renewal once approved.

This incentive is available statewide and can be combined with Indiana’s sales tax exemption and any applicable local rebate programs. Contact your county auditor’s office to confirm filing deadlines and any county-specific requirements before or shortly after your installation.

Indiana exempts qualifying solar energy equipment from the state’s 7% sales tax at the point of purchase. Exempt components typically include solar modules (panels), racking systems, and inverters — the core hardware directly involved in generating electricity. On a typical residential solar installation costing $28,000–$45,000, this exemption can save homeowners between approximately $2,000 and $3,200 instantly, with no post-purchase application required.

To take advantage of this exemption, you or your solar installer must provide the equipment seller with a properly completed Indiana General Sales Tax Exemption Certificate (Form ST-105) at the time of purchase. Most reputable solar installers in Indiana are familiar with this process and can handle the paperwork on your behalf.

This exemption is available statewide to all Indiana homeowners purchasing a qualifying solar energy system and can be combined with the property tax exemption and any applicable local rebate programs. There is no income limit or application window — the savings are realized immediately at the time of sale.

Indiana no longer offers traditional net metering for new solar customers. Instead, the state has transitioned to the Excess Distributed Generation (EDG) program. Under EDG, when your solar panels produce more electricity than your home uses, the surplus energy is sent to the grid and you receive a bill credit. For customers of the five major investor-owned utilities — AES Indiana, CenterPoint Energy, Duke Energy Indiana, Indiana Michigan Power (I&M), and NIPSCO — the credit rate is set at 125% of the avoided cost rate, which is typically well below the retail electricity rate. For example, AES Indiana’s current EDG credit rate is approximately 3.935 cents per kWh.

Customers of municipal electric utilities or rural electric member cooperatives (REMCs) may have different EDG credit rates, which vary by provider. You should contact your specific utility directly to confirm the current rate. Homeowners who installed solar before 2018 are grandfathered into full net metering until July 1, 2047, and systems installed between 2018 and the transition period retain full net metering until July 1, 2032.

Because EDG credit rates are significantly lower than retail electricity rates, maximizing your own solar consumption (self-consumption) is especially important in Indiana. Pairing solar with battery storage can help you use more of your generated power directly, reducing your reliance on lower-value grid credits. Contact your utility provider directly for your specific EDG rate and enrollment details.

Northern Indiana Public Service Company (NIPSCO) offers a Feed-In Tariff (FIT) program that functions similarly to Solar Renewable Energy Certificates (SRECs) in other states. Under this program, eligible NIPSCO solar customers earn credits based on the total electricity their system generates — not just the surplus sent to the grid. Solar systems between 5 kW and 10 kW earn between $0.15 and $0.17 per kWh generated, while systems above 10 kW earn between $0.13 and $0.15 per kWh.

This program is available exclusively to NIPSCO customers. However, as of the latest available information, the NIPSCO Feed-In Tariff program is currently closed to new applicants. Homeowners interested in this program should monitor NIPSCO’s website for any future reopening announcements.

Important note: If you are enrolled in the NIPSCO Feed-In Tariff, the credits you receive are considered taxable income and must be reported accordingly on your federal and state tax returns. Contact NIPSCO directly at the link above for the most current program status and enrollment information.

The Bloomington Green Home Improvement Program (BGHIP) provides cash rebates to Bloomington homeowners who install solar panels or battery energy storage systems. For solar panel installations, the general population receives a rebate equal to 20% of the project cost, while low-income homeowners qualify for 40% of the project cost. For other eligible projects (including battery storage), the general population rebate is 25% of project cost. The minimum rebate for any project is $500, meaning the minimum qualifying project size is $2,000 for general applicants and $1,250 for low-income applicants.

A key benefit of BGHIP is that a simultaneous installation of solar panels and a battery energy storage system qualifies for both rebates at the same time — an exception to the standard one-rebate-per-household-per-year rule. BGHIP rebates can also be combined with Indiana’s state sales and property tax exemptions, as long as the total of all rebates and incentives does not exceed the total project cost. The City of Bloomington has also partnered with Clean Energy Credit Union and Hoosier Hills Credit Union to offer loans with a 0.5% bought-down interest rate for BGHIP recipients.

To apply, submit your application through the City of Bloomington’s CiviForm website before starting your project to ensure funding availability. You will need to upload a project quote for pre-approval. After pre-approval, you have 60 days to submit proof of a paid contractor deposit and a completed W9/EFT form. Applications for already-completed 2026 projects are also accepted with a paid invoice. This program is available to Bloomington residents only.

The City of Bloomington’s SEEL (Solar, Energy Efficiency & Lighting) Program provides grant funding and technical assistance to nonprofits, community organizations, and small businesses seeking to install solar panels or battery energy storage systems. This program is not available to individual homeowners — it is designed exclusively for non-residential applicants. Grant amounts include up to $25,000 for a solar PV system installation, up to $20,000 for a battery energy storage system (nonprofits only), or a combined $45,000 for a simultaneous solar and battery installation (nonprofits only).

Applications are accepted on a rolling basis until all program funding has been allocated. The 2026 program cycle supports up to 9 new solar grants, or a mix of solar and battery grants. Applicants are encouraged to apply early, as funding is limited and awarded on a first-come, first-served basis.

In addition to grant funding, the SEEL program provides technical assistance to help eligible organizations navigate the solar installation process, from system design to contractor selection. For more information and to apply, visit the City of Bloomington Office of Sustainability’s official website at the link above.