Palmetto

Michigan

Solar Guide

Certified by Nathan Healy

Quality Solar Solutions Since 2011

Palmetto has served 20,000+ customers across 31 states with an approval rating over 85%.

In This Guide

01 Solar Energy in Michigan
02 Key Takeaways
03 Michigan Reviews
04 Solar Cost Calculator
05 Michigan Electricity Prices
06 Michigan Solar Incentives
07 Michigan Solar Production
08 Solar Installations in Michigan
09 Leasing Solar Panels
10 Frequently Asked Questions

Solar in Michigan

Michigan homeowners are increasingly turning to solar panels for their homes as electricity prices have surged 19% since 2020. With the state having the 12th highest utility prices per kWh in the nation, solar power offers a practical solution to rising energy costs.

Understanding solar installation in Michigan doesn’t have to be complicated. This guide breaks down everything you need to know about going solar in the Great Lakes State, from incentives to installation processes.

MICHIGAN by the Numbers

28th Most residential solar in the United States

21k Households have installed solar panels

~$6k Michigan average solar rebate savings

~$54k Michigan average savings over 25 years

Key Takeaways

Michigan solar installation costs average $14,238 after the federal tax credit, with typical systems paying for themselves in 8.5 years.
Rising electricity rates in Michigan make solar an attractive option, with prices up 19% since 2020 and continuing to climb.
Solar panels work effectively in Michigan despite seasonal variations, producing enough energy to power homes year-round with proper system design.

Palmetto Reviews

Palmetto completed installation of the solar panels on my roof, yesterday. They were exceptional. The installation crew was prompt, professional, and courteous. They maintained a clean and orderly workspace. Despite being impacted by afternoon thunderstorms, they completed the installation in a timely fashion.

Paul Stinavage

Kalamazoo, Michigan

The installation was professionally done on time neatly and with care as if it was there own house. The installer were courteous and informative on what was going on with each part of the installation

Donald Sonnenberg

Otsego, Michigan

Palmetto company Help you from A to Z , paper works, designed, permitted, and installations, take good care customer. My solar power save my electrical bill, I enjoy around year saving, thanks for your works.

John Tran

Warren, Michigan

Solar Cost in Michigan

Discover the true cost of solar installation in Michigan with Palmetto’s exclusive calculator. Using real data from our installations in Detroit, Grand Rapids, Lansing, and across Michigan, we provide accurate estimates tailored to your specific location, helping you make an informed decision about powering your home with clean energy.

System Size

Recommended System

6.38 kW

Typical for your home size in MI

This system size is designed to offset approximately 100% of the average electricity usage for a home of this size in Michigan.

Cost Breakdown

System Cost

$20,340

Federal Tax Credit (30%)

$-6,102

Final Cost

$14,238

Savings

Monthly Savings

Average utility bill reduction

$123

Payback Period

Break-even point

8.5 years

25-Year Savings
Total financial benefit
$54,190

Get Your Personalized Quote

Michigan Electricity Prices

Michigan residents face varying electricity costs depending on their utility provider. In 2023, DTE (19.7¢/kWh) and Consumers Energy (18.8¢/kWh) exceeded both state (18.8¢/kWh) and national (16.0¢/kWh) averages.

These higher rates stem from Michigan’s aging infrastructure and reliance on imported energy. While Great Lakes Energy (17.7¢/kWh) offers slightly better rates, only I&M (15.7¢/kWh) falls below the national average.

With Michigan’s electricity costs trending upward, solar installation provides homeowners a path to energy independence. Converting sunlight to electricity can stabilize your energy expenses while reducing dependence on increasingly expensive utility power.

Michigan Utilities Electricity Rates

Consumers Energy

18.80¢

+18%

DTE

19.70¢

+23%

Great Lakes Energy

17.70¢

+11%

I&M

15.70¢

-2%

MI Average

18.80¢

+18%

US Average

16.0¢

—

Source: US Energy Information Administration, 2023, Form 861, Table 6

Michigan Solar Incentives

Michigan offers valuable solar incentives in Michigan to help offset installation costs, making clean energy more affordable for homeowners across the state.

These incentives include a Property Tax Exemption that prevents your solar system from increasing your property taxes, and the Distributed Generation Program that credits you for excess electricity production.

Research these incentives thoroughly as they may change over time. Taking action sooner rather than later ensures you maximize your potential savings.

Save an average of

$6,102

in solar rebates in Michigan

INCENTIVE	TYPE	DESCRIPTION	SOURCE
Residential Clean Energy Credit	Federal tax credit	A federal tax credit worth 30% the cost of a solar panel system in the year it’s installed	Learn More
Property Tax Exemption	State tax exemption	Exempts your solar system’s added value from property tax assessment. Annual savings based on local tax rates.	Learn More

The Residential Clean Energy Credit lets people claim a tax credit worth 30% the cost of a solar panel system in the year it’s installed. The credit can only be used against taxes you owe or have already paid that year, but any excess credit can be rolled over to future years.

The credit is broadly available, though there are a few restrictions — you must own the panels and they must be on a house you live in — so be sure to consult a tax professional about your situation.

Michigan’s Property Tax Exemption for solar installations is designed to encourage renewable energy adoption by reducing the tax burden on property owners. This state tax exemption ensures that when you install solar panels on your property, the value they add to your home won’t increase your property taxes. Essentially, you can improve your property with solar without worrying about paying higher taxes.

While the legislation doesn’t specify exact dollar amounts or percentages saved, the financial benefit is straightforward: the entire value of your solar installation is exempt from property tax calculations. There are no specific eligibility requirements mentioned in the legislation beyond installing solar equipment on your property. The exemption took effect on June 14, 2022, and there are no mentioned expiration dates or deadlines. This incentive makes going solar more affordable in the long run by eliminating one of the potential financial drawbacks of property improvements.

Michigan’s Distributed Generation Program (Net Billing) is a solar incentive structure that allows homeowners with solar panels to receive credit for excess electricity they export to the grid. Unlike traditional net metering which credits exports at the full retail rate, this program credits exported electricity at a lower rate that varies by utility. When your solar system produces more electricity than your home uses, that excess is sent to the grid and you receive a credit on your bill based on your utility’s specific export rate.

The financial benefit varies by utility company: DTE Energy customers receive approximately 8.5 cents per kWh during off-peak hours and around 14 cents during summer peak hours (4-7pm). Consumers Energy provides between 9-16 cents per kWh depending on season and time of day, with highest values during summer peak (2-7pm). Indiana-Michigan Power offers 12.4 cents per kWh, while Lansing Board of Water & Light provides about 6-10 cents per kWh plus an additional 1.3 cents for the first 5 years. All utilities allow excess credits to roll over month-to-month as dollar amounts that can be applied to future bills. Monthly settlement occurs for all participating utilities.

This program is particularly beneficial for homeowners who can shift their electricity usage to times when solar production is highest, allowing them to maximize self-consumption and minimize lower-valued grid exports. While there are no specific eligibility requirements mentioned, homeowners should consult with their utility provider about system size limitations and application procedures before installation.

Ready to start saving with solar?

Speak with a Palmetto solar expert to find out exactly how much you can save with Michigan incentives.

Get a Free Quote

Michigan Solar Irradiance

Solar panel production varies throughout the year based on daylight hours, weather patterns, and sun intensity. Michigan’s snowy winters and northern latitude affect solar production, but with proper system design, solar panels can still generate significant energy throughout the year.

What Can the Average Michigan Solar System Power?

Summer Production (July)

54 kWh/day

In July, your 10 kW system could power:

3.6 average Michigan homes (15 kWh/day per home)
or Run central AC for 18 hours AND power all other appliances
or Fully charge 5.4 Tesla Model 3 electric vehicles

Winter Production (December)

30 kWh/day

In December, your 10 kW system could power:

2 average Michigan homes (15 kWh/day per home)
or Keep your home heating system running for 15 hours
or Fully charge 3 Tesla Model 3 electric vehicles

Annual Production

14,600 kWh/year

Over a year, your 10 kW system could:

Offset 10 tons of carbon dioxide emissions
or Equal the environmental benefit of planting 175 trees
or Save approximately $4,234 in electricity costs

Want to know exactly how much solar can power your home?

Get a personalized solar analysis based on your actual home, energy usage, and roof characteristics.

Get My Custom Estimate

Solar Installations in Michigan

Discover Michigan’s solar revolution! We’ve mapped every solar installation across the state, allowing you to explore which neighborhoods are embracing clean energy. See how your community compares and find inspiration from neighbors who have already made the switch to solar power.

Leasing Solar Panels

In Michigan, Palmetto offers flexible financing through Power Purchase Agreements (PPAs) for customers of DTE Energy and Consumers Energy. With a PPA, you pay only for the power your solar system generates at a set price per kilowatt-hour, rather than paying a fixed monthly amount as with a lease.

This arrangement eliminates the upfront cost of purchasing solar panels while still providing significant electricity savings. Palmetto handles everything from system design and installation to ongoing maintenance and monitoring, giving you peace of mind with our comprehensive protection program.

Unfortunately, LightReach is not currently available for Indiana-Michigan Power or Lansing Board of Water & Light customers. Interested in learning more about whether to buy or lease your solar system? Palmetto’s experts can help you determine which option best fits your energy needs and financial goals.

Go solar without the investment

With LightReach, there are no investment costs to recoup, loan payments to manage, or maintenance needs to take on. As soon as your panels are active, your solar savings are too!

Learn More

Frequently Asked Questions

Yes, solar makes sense in Michigan despite its northern location. With electricity rates 18% above the national average and rising, solar panels typically pay for themselves in 8.5 years while generating significant long-term savings.

Michigan’s solar production is sufficient year-round with proper system sizing, and incentives like the 30% federal tax credit and property tax exemption make installation more affordable. The state’s Distributed Generation Program also allows homeowners to receive credit for excess electricity production.

Michigan has replaced traditional net metering with a net billing system. Major utilities like DTE Energy, Consumers Energy, and Indiana-Michigan Power credit exported electricity at rates lower than retail (approximately 8.5-16¢/kWh depending on utility, season, and time of day).

Excess credits roll over monthly as dollar amounts applied to future bills. Lansing Board of Water & Light offers 6-10¢/kWh plus an additional 1.3¢/kWh for the first five years.

Yes, solar panels typically increase home value in Michigan. According to a Zillow study, homes with solar panels sell for approximately 4.1% more than comparable homes without solar.

Michigan homeowners benefit from this value increase while also enjoying protection from the state’s Property Tax Exemption, which prevents solar installations from raising property taxes. This combination makes solar an excellent investment for increasing home equity.

The average cost for solar installation in Michigan is approximately $14,238 after the federal tax credit, based on a typical 6.38 kW system. This represents about $2.23 per watt.

Costs vary depending on system size, equipment quality, and installation complexity. Most Michigan homeowners see their solar investment pay for itself in around 8.5 years, with potential lifetime savings exceeding $54,000 over 25 years.

In Michigan, solar is financially worthwhile for most homeowners. With electricity rates 18% above the national average and rising, a typical system pays for itself in 8.5 years while generating $54,000+ in lifetime savings.

The 30% federal tax credit and Michigan’s property tax exemption significantly reduce costs. Additionally, solar adds approximately 4.1% to your home’s value without increasing property taxes.

As a national solar company with a strong Michigan presence, we’ve completed over 826 installations across the state since 2020. Our local expertise combined with nationwide resources allows us to offer competitive financing options and high-quality installations.

We focus on educating homeowners about solar benefits while providing transparent, personalized service. Our extensive installation network ensures reliable service throughout Michigan’s diverse regions.