Iowa solar panels: The complete guide in 2025
Data updated Jul 15, 2025
Thinking about going solar? In Iowa, you’ll need a 11.23 kW system to match the average electric bill. It’ll cost you around $23,297 after the federal tax credit.
Cost for an average system in Iowa
| Out of pocket cost, cash | $33,282 |
| Federal tax credit (30%) | - $9,985 |
| Price post tax credit | $23,297 |
| 25-year savings | Payback period | Electricity offset |
|---|---|---|
| $30,753 | 13 Years | 98% |
As long as your federal tax bill is high enough, you can take advantage of the federal investment tax credit (ITC).
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Going solar in Iowa
While Caitlin Clark has stolen the spotlight with her dazzling basketball skills, Iowa still shines brightly as a prime candidate for solar panels. Iowans interested in going solar can benefit from the federal solar tax credit, tax exemptions, and solar buyback programs.
Here's what you need to know about installing solar panels in the Hawkeye State.
Cost
How much do solar panels cost in Iowa?
Solar panels will save you a lot of money over time, but the upfront costs aren't cheap. The average Iowa homeowner needs a 11.23 kW solar panel system to cover their electricity needs, which comes out to $33,282 before incentives. Prices range from $28,290 to $38,274, but after the federal tax credit, that drops by 30%.
While this may sound high, solar panels are often worth it in Iowa—especially if you want to lower your carbon footprint. That's why over 6,800 Iowa homeowners have used EnergySage to receive and compare quotes for solar installations. You can expect to earn back your initial solar investment through electricity savings in about 12.51 years, while most systems last at least 25 years. You'll often see this number referenced as your solar payback period.
Solar panel systems are expensive, but there are ways to finance your investment and reduce upfront costs.
Cash purchase: You pay for your system outright, which typically provides the best long-term savings.
Solar loan: You pay for your system in monthly installments like a lease but maintain ownership like a cash purchase. Generally, the best solar loans are subsidized clean energy loans through local incentive programs. If you don’t have access to that, a home equity loan or a personal loan are often your next best options. Private solar loans typically come with higher interest rates or upfront fees.
Solar lease or power purchase agreement (PPA): You make monthly payments on your system like a loan, but a third-party company owns your system. You’ll either sign a solar lease or purchase the electricity the panels generate through a PPA. Third-party ownership models typically deliver the lowest savings and have earned some bad press. If you choose this financing option, read the fine print: You can get trapped in them for longer than you'd like.
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Incentives
What are the best solar rebates and incentives in Iowa?
The federal solar tax credit reduces the cost of installing your solar energy system by 30%–and Iowa also offers sales and property tax exemptions for solar panel systems, which can help you save thousands.
| Incentive | Average savings in Iowa | Description |
|---|---|---|
Residential Clean Energy Tax Credit, formerly the federal investment tax credit (ITC) | $9,985 | Lowers your solar panel system's cost by 30% |
Iowa solar sales tax exemption | 6% savings on the cost of equipment | You don't need to pay any sales tax on new solar panel systems in Iowa. |
Iowa solar property tax exemption | The average property tax in Iowa is 1.5% | You’re exempt from paying property taxes on the increased value of your home for 5 years. |
Is net metering available in Iowa?
In some states, you'll earn bill credits from your utility company when your solar panel system generates excess electricity and sends it to the grid. This incentive is known as net metering—basically a solar buyback program—and makes it so you will owe very little, or even nothing, on your electric bills with solar panels.
Some of Iowa's utilities offer net metering, including Alliant Energy (aka Interstate Power and Light). MidAmerican Energy, however, calculates its buybacks differently. Instead of awarding energy credits for each kWh of excess solar, it offers dollar-based bill credits.
The rest of the state’s electric cooperatives and municipal utilities aren’t required to offer residents a net metering option, although many do.
Equipment
Equipment quality
The more efficient a solar panel is, the more power per square foot. As of 2025, the most popular solar panels have a rated output of 450 watts. To get the most out of your solar energy system, choose panels with at least that much power output.
Your solar inverter setup is also important consideration—make sure it suits your roof’s layout.
And if you’re interested in a solar battery, it’s best to choose one that integrates with that inverter.
The best equipment tends to be more expensive, but it will often save you more money in the end. Premium equipment often has the best warranty terms, guaranteeing 25-40 years of coverage for repairs, replacements, and the lowest degradation rates (meaning they’ll maintain more of their power output for longer).
Companies
Who are the best solar installers in Iowa?
We pre-screen all of the solar companies on EnergySage to ensure they'll provide you with a high-quality installation. We then rate them based on their results, reputation, and responsiveness. Here are the highest-rated EnergySage installers in Iowa:
Ready to start looking for a solar installer?
Here are some of the most popular ones near you:
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resources
Top solar resources for Iowa
- Iowa Solar Loan Providers
Search through our list of top loan providers to finance your solar panel system.
- Iowa Energy Office
Learn about IA clean energy programs from the state government.
- Iowa Utilities Board
Read more about how utility companies work in IA.
- Iowa Electricity Profile (EIA)
Learn about IA energy production and prices.
- IA State Solar Factsheet (SEIA)
See quick stats about how much solar energy has grown in IA.
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