Solar in Idaho: market, Idaho Power export compensation and permits

Market snapshot

Solar in Idaho by the numbers

Installed capacity

950 MW

Homes powered

143K

Solar share of electricity

4%

Solar jobs in state

1,200

Typical cost per watt

$2.60

US ranking

#29

Idaho's solar market grew rapidly in the mid-2010s under retail NEM. Idaho Power's 2024 ECR transition and Rocky Mountain Power's earlier Net Billing Service Schedule change reshaped the residential economics. The federal tax credit remains the dominant incentive. Treasure Valley (Boise, Nampa, Meridian) dominates the residential market.

Rates and net metering

Electric rates and how solar export is credited

Incentives

State and local solar incentives in Idaho

Beyond the 30 percent federal Residential Clean Energy Credit, which applies in every US state through 2032, Idaho has these state and local programmes.

Idaho Residential Alternative Energy Tax Deduction

Idaho offers a 40 percent state income tax deduction (not credit) on the installed cost of residential solar systems, capped at $5,000 in year one and $20,000 total over 4 years. Deduction value depends on marginal tax rate; for most homeowners this represents 2 to 3 percent of system cost in actual tax savings.

Sales-tax exemption

Idaho exempts residential solar PV equipment from the state's 6 percent sales tax under the renewable energy equipment exemption.

No state property-tax exemption

Idaho does not have a statewide property-tax exemption for residential solar. The added value may be included in assessment at the county level; check with the local assessor.

Permits and interconnection

Permits and interconnection

Permit timelines in Idaho vary by jurisdiction. Boise, Meridian, Nampa and Caldwell commonly take 2 to 4 weeks for residential. Ada County, Canyon County and smaller counties can be faster or similar. SolarAPP+ is in pilot in Boise but not broadly deployed. Interconnection with Idaho Power typically runs 3 to 6 weeks post-install.

Running a solar company here

Running a solar company in Idaho

Running a solar company in Idaho means working in a market where the 2024 ECR transition has shifted economics toward self-consumption sizing. The best Idaho operators run honest annual load-match analyses before quoting, model Idaho Power's time-varying ECR into payback calculations, and understand the three-utility split (Idaho Power, Rocky Mountain Power, Avista) that applies at state boundaries. Low electric rates mean Idaho solar is sold more on energy independence and locking in rates than on fast payback.

Cities we cover

Solar in Idaho metros

• Solar in Boise

Questions people ask

Solar in Idaho: FAQ

Does Idaho Power have net metering?

Not retail-rate for new customers since 2024. Idaho Power's Export Credit Rate (ECR) credits residential solar exports at an hourly rate derived from avoided energy cost (approximately $0.044 to $0.057 per kWh depending on time of day). Pre-2024 customers are grandfathered on retail NEM.

How much does solar cost in Idaho?

Residential solar in Idaho averages around $2.60 per watt installed, meaning a typical 7 kW system costs about $18,200 gross. After the 30 percent federal tax credit, net cost is approximately $12,700. The Idaho state tax deduction adds modest additional savings depending on marginal tax rate.

Is solar worth it in Idaho?

For Idaho homes with high electricity use and south-facing roofs sized to self-consumption, yes: payback typically runs 10 to 14 years with the federal tax credit. Low retail rates (around $0.11 per kWh) and the ECR for exports stretch payback compared with Sun Belt peers. Right-sized systems that match annual load pencil out better than oversized ones under the ECR.

What is the Idaho state solar tax deduction?

A 40 percent state income tax deduction (not credit) on residential solar system cost, capped at $5,000 in year one and $20,000 total over 4 years. The deduction value depends on marginal state income tax rate; for most Idaho homeowners this represents 2 to 3 percent of system cost in actual tax savings, modest compared with the federal tax credit.