Kansas Solar Panels

Under K.S.A. 79-201 Eleventh, Kansas provides a 10-year property tax exemption for all property used to generate electricity from renewable energy resources, including residential and commercial solar (photovoltaic) systems. For systems installed after December 31, 2016, the exemption begins the year after installation is completed and lasts for a full decade. No application is required — the exemption applies automatically once your system is installed and assessed.

The financial benefit can be significant. Solar panels typically add around $12,500 to a Kansas home’s market value. At an average property tax rate of roughly 1.33%, that translates to approximately $166 in annual tax savings, or over $1,600 across the full 10-year exemption period. Larger systems with greater added value will see proportionally higher savings.

Important note: Kansas has ruled that this property tax exemption applies to solar panels but does not extend to battery storage systems used in residential installations. The exemption covers all eligible solar property regardless of whether it is a residential, commercial, or industrial application.

Kansas’ two investor-owned utilities — Evergy and Liberty Utilities — are required by state law to offer net metering to their solar customers. Residential systems up to 150 kilowatts AC are eligible to participate (note: customers who began operating prior to July 1, 2014 are limited to 25 kW). Under net metering, your solar production is tracked throughout the month, and any excess electricity you export to the grid earns a bill credit. However, that credit is calculated at the utility’s wholesale “system average cost” rate — approximately 2.4 cents per kWh — rather than the full retail rate of around 13.62 cents per kWh. Unused credits carry forward month to month but expire annually on March 31. Additionally, starting January 1, 2026, new net metering participants are limited to exporting no more than 50% of their system’s export capacity.

Municipal and cooperative electric utilities in Kansas are not required to offer net metering, but they must offer a “parallel generation” or net billing program. Under net billing, the utility compensates you with dollar-value bill credits (rather than kWh credits) for the solar power you supply to the grid, at a rate of 1.5 times the utility’s avoided cost rate. While this is still below full retail value, it provides meaningful compensation for excess solar generation.

Because excess energy is compensated at wholesale rather than retail rates, Kansas homeowners benefit most from solar systems sized to closely match their own consumption, minimizing the amount of electricity exported to the grid. It is recommended to contact your specific utility — Evergy, Liberty, or your local municipal/cooperative provider — to confirm the exact rates and program terms applicable to your account.

The federal Residential Clean Energy Tax Credit under IRS Code Section 25D provides a 30% tax credit on the cost of new battery storage systems with a capacity of 3 kWh or greater. This credit is currently active and available for Kansas homeowners in 2026. Unlike the residential solar ITC (which was eliminated effective January 1, 2026), the battery storage credit remains in place and can be claimed on standalone battery installations — meaning you do not need to pair the battery with a new solar system to qualify.

The credit is non-refundable, meaning it can reduce your federal income tax liability to zero but will not result in a refund for any excess credit amount. However, unused credit amounts may be carried forward to future tax years. To claim the credit, homeowners file IRS Form 5695 (Residential Energy Credits) with their federal tax return for the year the battery system is placed in service.

Looking ahead, the 25D battery storage credit is scheduled to phase down after 2032 — dropping to 26% in 2033 and 22% in 2034 — before sunsetting entirely after 2034 unless Congress acts to extend it. Kansas does not offer any state-level battery storage rebates or incentives, so this federal credit is currently the primary financial incentive available to Kansas homeowners adding battery storage.

Evergy, one of Kansas’ two major investor-owned utilities, operates a Battery Storage Pilot Program as a research and development initiative to test home battery storage technologies. The program is designed to allow a limited number of residential customers to participate in battery storage trials at reduced out-of-pocket costs, helping Evergy gather data on how distributed battery storage performs on its grid.

Because this is a pilot (R&D) program, availability is limited and enrollment is not guaranteed. Interested Evergy customers should contact Evergy directly to inquire about current availability, eligibility requirements, and any cost-sharing or incentive structures associated with participation. Program terms and availability may change as the pilot evolves.

This program is separate from any federal tax credits and represents a utility-level opportunity for Evergy customers specifically. Customers served by Liberty Utilities, municipal utilities, or electric cooperatives should contact their own provider to ask about any similar battery storage programs that may be available in their service territory.

Kansas state law provides a framework for solar easements, which are voluntary written agreements between neighboring property owners that protect a solar system owner’s access to sunlight. These easements are legally binding once recorded with the county register of deeds and can prevent neighboring properties from constructing buildings, planting trees, or making other changes that would shade your solar panels and reduce their output.

A solar easement must be established by mutual agreement — it is not automatically granted — and should clearly describe the protected solar access area, the restrictions placed on the neighboring property, and any compensation or terms agreed upon by both parties. Once recorded, the easement runs with the land and remains in effect even if either property is sold.

While this is not a financial incentive in the traditional sense, solar easement protections are a valuable legal tool that can safeguard the long-term energy production — and therefore the financial return — of your solar investment. Homeowners considering a solar installation are encouraged to consult with a local real estate attorney to determine whether a solar easement is appropriate for their property situation.

The USDA Rural Energy for America Program (REAP) provides grants and guaranteed loan financing to agricultural producers and rural small businesses in Kansas for the purchase and installation of renewable energy systems, including solar panels. Grants can cover up to 50% of eligible project costs, making this one of the most significant financial incentives available to qualifying Kansas solar customers. Applications are accepted on a rolling basis through the USDA Rural Development Kansas State Office.

To be eligible for a REAP grant, applicants must be either an agricultural producer (with at least 50% of gross annual income from agricultural operations) or a small business located in a rural area. Applicants must also have no outstanding federal debt, judgments, debarments, or delinquent federal taxes. The solar project must be technically feasible and demonstrate financial need or benefit.

REAP is a federal program administered locally through USDA Rural Development, and Kansas farmers and rural business owners are encouraged to contact their local USDA Rural Development office for current funding availability, application deadlines, and assistance with the application process. This program is particularly well-suited for Kansas agricultural operations looking to offset high energy costs with on-site solar generation.