Solar Guide
Solar in Detroit
Detroit homeowners are discovering solar energy as a smart solution to rising electricity costs. With Michigan’s electricity prices increasing 19% from 2020 to 2024, many residents are exploring how solar panels for home use can provide long-term savings.
Understanding your options for solar installation in Detroit starts with knowing the basics. This guide covers everything from local incentives to installation considerations specific to the Motor City.
Key Takeaways
- Detroit homeowners can save $40,000+ over 25 years with solar panels, thanks to Michigan’s high electricity rates and federal tax credits.
- Michigan ranks 6th nationally for residential solar installations with 159,000 households already enjoying clean energy benefits.
- Solar works year-round in Detroit’s climate producing significant energy even during Michigan’s cloudy winter months.
Solar Cost Calculator
Our Detroit solar cost calculator uses real installation data from neighborhoods like Dearborn, Warren, Sterling Heights, and Livonia. Get accurate pricing estimates based on actual local projects, not generic estimates.
System
Cost
Savings
Detroit Electricity Prices
Detroit electricity costs continue climbing, with rates now significantly higher than the national average.
Michigan electricity rates jumped from 17.5 cents per kWh in 2021 to 19.3 cents in 2024, representing a 10.9% increase over three years.
Solar panels generate electricity from sunlight, helping Detroit homeowners reduce their dependence on the traditional power grid and rising utility rates.
Over 25 years, solar systems can provide predictable energy costs while traditional electricity rates continue their upward trend in Michigan.
Price of Energy: Michigan vs National Average
Detroit Area Utility Providers
Detroit residents pay above-average electricity rates through two main utilities. In 2023, Consumers Energy charged 18.8¢ per kWh while DTE Energy charged 19.7¢ per kWh.
Both utilities exceed the 2023 national average of 16.0¢ per kWh, with DTE Energy rates running 23% higher than typical American households pay.
These higher electricity costs make solar more attractive for Detroit homeowners, as solar panels can offset expensive utility power with free sunshine energy.
Detroit Utilities Electricity Rates
Michigan Solar Incentives
Detroit residents can reduce solar installation costs through available solar incentives in Michigan and federal programs designed to make clean energy affordable.
Michigan offers property tax exemptions that protect homeowners from increased assessments when adding solar panels. The state’s net billing program also provides credits for excess electricity your system produces.
These incentives change frequently, so research current programs thoroughly. Acting promptly helps ensure you capture available savings opportunities.
$6,102
Average savings in Michigan solar rebates
| 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.
I apologize, but the document you’ve provided appears to be about emergency services authorities and municipal bond financing, not about solar energy property tax exemptions. The legislation (Michigan Senate Bill 821) deals with emergency services authorities’ powers to issue bonds and levy taxes, but does not contain any information about solar energy systems or property tax exemptions for renewable energy installations.
To provide you with an accurate description of Michigan’s solar property tax exemption program, I would need the correct legislative text or official documentation that specifically addresses solar energy property tax exemptions. This might be found in a different Michigan statute or administrative rule that deals with renewable energy incentives rather than emergency services financing.
Michigan’s Distributed Generation Program (Net Billing) is a state-wide policy that allows homeowners with solar panels to receive credits for excess electricity they send back to the grid. Unlike traditional net metering where you receive full retail value for your solar exports, this program credits you at a reduced rate that varies by utility company and time of day. You’ll still pay the full retail rate for electricity you use from the grid, but any solar power you generate and don’t immediately use gets credited at a lower wholesale-style rate.
The financial benefits depend on your specific utility company. DTE Energy customers receive approximately 8.5 cents per kWh for off-peak exports and around 14 cents per kWh during summer peak hours (4-7pm). Consumers Energy credits range from 9-16 cents per kWh depending on season and time, with the highest rates during summer peak (2-7pm). Indiana-Michigan Power offers 12.4 cents per kWh, while Lansing Board of Water & Light provides 6-10 cents per kWh plus an additional 1.3 cents per kWh bonus for the first five years. All utilities allow you to roll over unused credits month-to-month as dollar amounts applied to future supply charges.
This program is available to all residential solar customers in Michigan, with monthly settlement periods across all participating utilities. The key consideration for homeowners is that maximizing your solar savings means using as much of your generated electricity as possible during daylight hours, since the solar power you consume directly avoids paying the full retail rate. Any excess power sent to the grid will be credited at these lower export rates, making energy usage timing an important factor in your overall solar economics.
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 QuoteDetroit Solar Irradiance
Solar panel production varies throughout the year based on daylight hours, weather patterns, and sun intensity. Understanding how seasons affect your solar system helps set realistic expectations for your investment.
Detroit’s continental climate brings snowy winters and variable cloud cover, but with proper system design, solar panels perform excellently year-round here.
Solar Production in Detroit by Month
What Can Your Solar System Power?
Summer Production (July)
In July, your 10 kW system could power:
- 3.6 average 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)
In December, your 10 kW system could power:
- 2 average 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
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 EstimateSolar Installations in Detroit
We’ve mapped every solar installation across America to show you something exciting: your Detroit neighbors are embracing clean energy! Explore this interactive map to discover which communities have made the switch to solar.
Leasing Solar Panels
Detroit homeowners served by DTE Energy and Consumers Energy can access Power Purchase Agreements (PPA) through Palmetto’s LightReach program. With a PPA, you pay for the actual electricity your solar panels produce at a fixed rate per kilowatt-hour, typically lower than your utility rate.
Unlike cash purchases where you handle all maintenance and repairs yourself, a PPA includes complete system monitoring and maintenance. Your solar provider ensures optimal performance while you enjoy predictable energy costs and immediate savings without the large upfront investment.
This financing option works well for homeowners who want solar benefits without ownership responsibilities. Learn more about solar financing options to determine which approach fits your situation best.
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 MoreFrequently Asked Questions
Yes, solar makes excellent sense in Detroit. With Michigan electricity rates at 19.3¢/kWh—well above the national average—Detroit homeowners can save $40,000+ over 25 years with solar panels.
Detroit’s continental climate provides sufficient sunlight year-round for strong solar production. Combined with the 30% federal tax credit and Michigan’s property tax exemption, solar offers compelling financial benefits for Motor City residents.
Detroit does not have traditional net metering. Michigan utilities like DTE Energy and Consumers Energy use net billing programs that credit solar exports at reduced rates compared to retail electricity prices.
DTE customers receive 8.5-14 cents per kWh for excess solar power, while Consumers Energy pays 9-16 cents per kWh depending on time and season. These credits roll over monthly and still provide meaningful savings for Detroit solar owners.
Yes, solar panels increase home value in Detroit, MI. Research shows that solar installations typically boost property values by approximately 4.1%, according to Zillow’s comprehensive study.
For Detroit homeowners, this translates to significant added value given the area’s median home prices. Additionally, Michigan’s property tax exemption means you won’t pay higher taxes on the increased value that solar panels add to your home.
Solar installation costs in Detroit typically range from $11,721 to $19,653 after the 30% federal tax credit, depending on your home size and energy needs.
A typical medium-sized home (2,000-3,000 sq ft) requires a 6.38 kW system costing approximately $14,238 after incentives. This investment provides around $93 monthly savings and pays for itself in about 11 years through reduced electricity bills.
Yes, solar is financially worth it in Detroit. With Michigan electricity rates at 19.3¢/kWh—well above the national average—Detroit homeowners typically save $40,000+ over 25 years with solar panels.
The average Detroit solar system costs $14,238 after federal tax credits and pays for itself in about 11 years through monthly electricity savings of $93. Combined with Michigan’s property tax exemption and rising utility rates, solar provides strong long-term financial returns for Motor City residents.
We believe Palmetto Solar is the best choice for Detroit homeowners. We’ve completed 826 installations across Michigan since 2020, giving us deep experience with local conditions and regulations.
Our customers consistently praise our professional installation teams and comprehensive service. We offer competitive financing options and handle everything from permits to interconnection, making solar simple for Detroit residents.