Kansas is a state that receives a lot of sunlight throughout the year. This makes this state an optimal area to harvest solar energy. The state can receive up to six hours of sunlight a day with, on average, 225 sunny days a year.
Having a lot of sunlight is excellent. You receive more energy from your solar system, resulting in more savings over the long run and value for your invested capital.
There’s a lot of untapped potential in the solar energy sector, the state of Kansas produces an average of 33.72 megawatts of solar power. These figures are low when compared to other states like Texas and California.
The state of Kansas recently repealed its Renewable Energy Portfolio Standard and introduced a voluntary system. This means that utilities are not obliged by law to increase solar and other renewable solutions as their main modes of generating electricity.
As a result, utility providers can continuously increase the cost of energy that they generate from their own alternative sources rather than encourage consumers to generate their own using solar PV.
Solar power remains a feasible alternative to your energy solutions in Kansas. The incredible sun intensity makes a 5kW solar system a viable solution for an ordinary home.
This system offers excellent value and a balance between upfront costs and savings. The average price of a 5kW system in Kansas is around $30,000. The benefit of installing a solar system in Kansas is that it starts generating electricity immediately, so you start saving instantly.
Due to the generous amount of sunlight available, you can save up to $900 in electricity expenses in the first year. You can expect a payback period of 14-20 years.
Most laws regarding solar panels are mainly set to encourage residents to switch to solar. These laws come in the form of incentives, rebates and tax exemptions. Here are the solar panel laws in Kansas.
Federal Tax Credit
The federal government offers residents a 26% tax credit cut for anyone that acquires a solar system. This perk is known as the Investment Tax Credit (ITC), allows you to cut 26% of the initial cost of your solar system from the taxes you owe the government.
The total cost should also include the installation costs, the solar panels and auxiliary components. If your solar energy system set you back $20,000, the federal solar tax credit would be $5,200.
You can deduct that amount from the taxes that are due. If you don’t pay enough tax to make a full deduction in a year, you can split the deduction into subsequent years.
This tax credit applies to those who buy the solar system with cash and even those who purchase with a loan. You don’t have to pay any initial money in order to qualify.
Users who take a solar loan can use the tax credit cuts to pay for the loan’s initial instalments. Since you don’t have to pay any electricity charges, you continue saving up more and using the saved money to offset the loan.
Property Tax Exemption
Kansas has passed a law that exempts solar panels to be included in property taxes. When you install a solar system in your house, the solar panels increase your house’s value. Property taxes are paid according to the property and house owned value; thus, when the property value increases, the property taxes also increase.
In Kansas, solar power systems are exempted from property taxes. Valuers should not include the value-added by the installation of solar panels. This saves property owners thousands of dollars in the long haul as solar panels increase a house’s value by an average of $18,000.
Solar power is only exempt from property taxes only. You will have to pay sales tax to buy solar panels and other components.
Net Metering In Kansas
Kansas has a robust net metering system. The net metering is done by utility providers and serves many benefits to owners who own PV systems.
Net metering allows customers who have installed solar power systems in their households to connect to the grid. When your solar system produces more power than you need in your household, the extra power is adopted by the grid and distributed to other customers.
When the grid adopts energy, you earn solar credits. These solar credits can be used to offset your electricity bill.
When you use more energy than your solar system can provide, i.e. during the winter, there’s minimal sunlight. These solar credits can be netted off your total electricity costs. The solar credits are rolled off to subsequent months. This means you can generate enough credits in the summer to offset the electricity consumed during the winter, where solar energy production is low.
The solar credits are, however, not carried off to subsequent months indefinitely. The credits expire after 12 months. There’s no financial compensation for expired credits. This should not be a problem if you size your solar system correctly to fit your household’s needs.
It’s important to note that state-owned utilities and cooperatives are not forced to comply with the net metering policy, so that net metering may be unavailable in some areas.
However, many cooperatives have opted to provide net metering to their customers. There’s no standard interconnection policy; every utility sets its own requirements.