Independent Solar Advisor • Updated July 2026

Solar Panels in
Kentucky

Not in Kentucky?

Kentucky runs two solar economies. In LG&E and KU territory, exported power earns a PSC-set credit of 6.9 to 7.4¢, roughly two-thirds of retail and among the fairest post-net-metering rates anywhere. West of the TVA line, exports earn avoided cost, a few cents, and the Tennessee playbook applies. Same commonwealth, different math, and the Feb 2026 rate increases just made every self-consumed kilowatt-hour worth more. EcoGen America starts by finding which Kentucky you live in.

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LG&E / KU Export Credit 6.9 – 7.4¢/kWh
Western KY (TVA) Avoided-Cost Exports
Rates Rising PSC Hikes, Feb 2026
Incentive Strength
Fair Price Range $2.55 – $3.25/W
About EcoGen America

In Kentucky, the TVA Line Decides Your Solar Math.

Kentucky runs two solar economies at once. In LG&E and KU territory, exported power earns a PSC-set credit of 6.9 to 7.4 cents, roughly two-thirds of retail and among the fairest post-net-metering rates anywhere.

West of the TVA line the same panels earn avoided cost for exports, a few cents, and the Tennessee playbook applies. Same commonwealth, different math.

The PSC rate increases of February 2026 push in one direction: every kilowatt-hour you consume yourself is worth more than it was, on either side of the line.

EcoGen America starts by finding which Kentucky you live in, sizes for self-use where exports pay little, and checks quotes against what LG&E, KU and the TVA distributors actually credit before anything gets signed.

Dean Mahmoud Written by Dean Mahmoud •  Last updated September 4, 2026
Our vetting process

Two-Territory Guidance

LG&E-KU crediting and TVA-side avoided-cost exports are different products. We work out which side of the line your meter sits on before any sizing talk.

Quote Analysis

Built-in checks for NMS-2 crediting assumptions, self-use sizing where exports pay a few cents, and payback claims that ignore the February 2026 rate increases.

Local Policy

We track LG&E and KU tariff filings, PSC rate cases and NMS-2 crediting decisions, and the avoided-cost rates TVA distributors pay in western Kentucky.

Privacy First

Your data is only shared with the licensed Kentucky installers you choose.

Trevor Guilday
Reviewed by Trevor Guilday, founder of EcoGen America · LinkedIn
Trevor has worked in home improvement and residential solar since 2016 and maintains the EcoGen Solar Cost Index.

NMS-2, Decoded: What LG&E and KU Actually Pay

Kentucky’s PSC rejected both extremes: it ended one-to-one retail netting for new systems, and it refused the utilities’ push for bare wholesale rates. What it built instead:

Utility
Export Credit (NMS-2)
What Builds the Rate
LG&E
7.089¢/kWh
Avoided energy + generation, transmission and distribution capacity + carbon and ancillary components
KU
7.534¢/kWh
Same methodology, KU’s system costs
Pre-Sept 25, 2021 systems
Legacy retail netting, grandfathered 25 years
The old program, preserved for existing owners
Rates per the Kentucky PSC order of August 30, 2024. A settlement approved February 16, 2026 holds NMS-2 export rates at these values and keeps the program open to new participants until their next base rate case, with a base-rate stay-out to August 1, 2028.

Two-thirds of retail for exports changes design freedom: modest overshoot is forgivable here in a way it simply is not in Indiana or Kansas. Kentucky quotes can breathe, provided they use the real rate.

Locate, Model, Time: The Kentucky Order

1

Locate

Find your utility first. LG&E/KU means NMS-2 credits near 7¢; a western Kentucky TVA co-op means avoided cost and Tennessee rules.

2

Model

Insist on your territory's actual export rate in the projection, and on self-consumption priced at the new post-hike retail rates.

3

Time

The Feb 2026 increases will not be the last. Rising rates compound the value of production you consume yourself.

Not sure which Kentucky you are in?

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West of the Line: TVA Kentucky Plays by Different Rules

Paducah, Bowling Green, Hopkinsville and their neighbors buy power through TVA’s local power companies, and the PSC’s NMS-2 rates do not reach them. What applies instead:

  • Exports earn near TVA avoided cost, a few cents per kilowatt-hour, under dispersed-power arrangements rather than net metering.
  • Self-consumption carries the entire case: size to daytime usage, exactly as our Tennessee guidance runs, because surplus is compensated thinly.
  • Interconnection paperwork varies by local power company; an installer fluent with your specific LPC saves weeks.
  • TVA’s Quality Contractor Network is a useful screen for western Kentucky the same way it is across the state line.

The commonwealth’s solar advice is therefore an address question. The same 10 kW array is a comfortable two-thirds-export project in Lexington and a strict self-consumption build in Paducah.

Kentucky Contract Checks

Kentucky Quotes: Four Commonwealth Checks

Two territories, one set of discipline. Run these four on any Kentucky quote.

Clause to verify: Make the quote name your utility and use its filed rate: 7.089¢ LG&E, 7.534¢ KU, avoided cost in TVA territory.
Clause to verify: Check the export line; retail-rate crediting on a new system means the model predates the current rules.
Clause to verify: Confirm the avoided-retail assumption reflects the 2026 approved rates, not 2024 bills.
Clause to verify: Both prices side by side and the spread explained, before signing.
Verify your paperwork

Four checks, any Kentucky quote, either territory.

Check Kentucky Price Fairness Find My Territory Rate

Kentucky Installers on Both Sides of the Line

Vetted for Kentucky licensing, NMS-2 and TVA-territory experience and complaint history.

Solar Alliance

NABCEP Accredited Team Generac Authorized Dealer
Why Recommended
  • NABCEP-accredited engineers and installers
  • Authorized Generac dealer: solar, battery, and generator microgrids
  • Knoxville-based with several megawatts installed across TN and KY
  • Contracted by Knoxville Utilities Board for a 1 MW solar project
Warranty
Manufacturer equipment warranties
Timeline
Quoted per project
Experience
10 Years
Service Area
Tennessee & Kentucky

Morton Solar

NABCEP Certified Certified B Corp Tesla Powerwall Certified
Why Recommended
  • Installed some of the very first solar systems in Indiana
  • NABCEP PV Certified with IBEW electricians on crew
  • Certified B Corporation and Amicus Solar Cooperative member
  • Engineered two of the nation's earliest net-zero public schools
Warranty
Manufacturer warranties + in-house O&M
Timeline
Quoted per project
Experience
20 Years
Service Area
S. Indiana, W. Kentucky, S. Illinois

Solar Energy Solutions

2,750+ Systems 7 NABCEP Pros Tesla Premier Installer
Why Recommended
  • 2,750+ solar systems installed across the Ohio Valley since 2006
  • 7 NABCEP Certified PV Installation Professionals on staff
  • Tesla Energy Premier Installer with in-house technicians
  • Offices in Lexington, Louisville, Indianapolis and Evansville
Warranty
Manufacturer warranties, in-house crews
Timeline
Quoted per project
Experience
20 Years
Service Area
KY, IN, OH, IL, VA

Synergy Home

KY License CE65736 IREC-Accredited Techs Free Second Opinions
Why Recommended
  • Prints its Kentucky Electrical Business Contractor License on its site
  • IREC-accredited technicians
  • What-we-quote-is-what-you-pay basis with free second opinions
  • Solar and HVAC under one Lexington firm
Warranty
25 to 30-year panel warranties
Experience
12 Years
Service Area
Central Kentucky, Berea to Winchester

When Kentucky Solar Says Wait

Even with the region’s fairest export rate, some projects should pause:

  • TVA-territory homes with low daytime usage and no battery plan. West of the line, thin exports cannot rescue an empty house.
  • Quotes still assuming retail netting. That program closed to new systems in 2021; a model built on it fails on arrival.
  • Payback that needs tax credits. Kentucky has no state credit and the federal one ended December 2025.
  • Shaded hollows and tree-lined lots. Kentucky’s terrain shades hard; a site study beats an installer’s assurance.
  • Owners of pre-2021 grandfathered systems considering replacement. Price any upgrade against the 25-year legacy netting you would surrender.

In LG&E/KU country with decent sun, the two-thirds export rate plus rising retail prices make Kentucky one of the quieter good deals in the region.

Kentucky Solar, Both Kentuckys

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Incentives

Kentucky Solar Incentives: Rates Locked Until August 2028
Are Solar Panels Worth It in Kentucky? The Simplest Case Here
Investment

Are Solar Panels Worth It in Kentucky? The Simplest Case Here
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Programs

Free Solar Panels in Kentucky: You Already Have the Certainty
Top 3 Solar Companies Serving Kentucky’s Two Grids (2026)
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Top 3 Solar Companies Serving Kentucky’s Two Grids (2026)

1. Kentucky quote in hand?

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Kentucky Solar FAQs

Does Kentucky have net metering?

New LG&E and KU systems earn NMS-2 export credits, 7.089¢/kWh at LG&E and 7.534¢ at KU, set by the PSC using an avoided-cost methodology that includes capacity components. It is not one-to-one netting, but it is roughly two-thirds of retail, unusually fair for a post-net-metering rate.

Systems installed before September 25, 2021 keep legacy retail netting for 25 years.

I live in western Kentucky. Do the LG&E/KU rates apply to me?

No. Western Kentucky’s local power companies buy from TVA, so exports there earn avoided cost, a few cents per kilowatt-hour, and self-consumption drives the economics the way it does in Tennessee.

Your address decides your math; confirm your utility before believing any projection.

Did Kentucky electric rates just go up?

Yes. In February 2026 the PSC approved increases averaging 6.54% for KU residential customers and 4.73% for LG&E.

Rising retail rates raise the value of every kilowatt-hour your panels keep off the bill, which strengthens solar paybacks commonwealth-wide.

Are there solar tax credits in Kentucky?

No state credit, and the federal residential credit ended in December 2025.

Kentucky’s case rests on the NMS-2 export rate, rising retail prices and right-sizing, which together hold up better than most neighbors’ math.

Is solar worth it in Kentucky?

In LG&E/KU territory, right-sized systems earn full retail on self-use and ~7¢ on surplus, a workable pairing at current install prices. In TVA territory, the project must live on self-consumption alone.

Both cases fail for heavily shaded roofs and quotes still selling dead incentives, and we say so plainly.

References & Research Sources

The rates, program terms and figures on this page come from the records below. Sources accessed between June 11, 2026 and August 20, 2026. Publication, revision and effective dates are listed where a record carries one.

  1. Kentucky Public Service Commission (PSC). Order in Case 2023-00404. Rider NMS-2 export credits for LG&E and KU, with the October 2025 stipulation maintaining them. Issued August 30, 2024. The source for the LG&E and KU export credits printed in the table on this page. Accessed June 11, 2026.
  2. Kentucky Public Service Commission. Order approving the LG&E and KU rate case settlement, February 16, 2026 (Case Nos. 2025-00113 and 2025-00114). The base-rate stay-out until August 1, 2028, the commitment to hold NMS-2 rates, and the commitment not to close NMS-2 before the next base rate case. Behind the February 2026 KU and LG&E rate increases reported on this page. Accessed August 20, 2026.
  3. Kentucky General Assembly. KRS 278.465 to 278.468. Senate Bill 100 of 2019 framework replacing one-to-one netting with Commission-set export credits. Behind the line that one-to-one netting ended for new LG&E and KU systems in September 2021. Accessed June 11, 2026.
  4. Louisville Gas and Electric and Kentucky Utilities. Net metering documentation. Rider NMS-2 mechanics, the dollar-credit structure that replaced one-for-one netting under Senate Bill 100, and interconnection steps. Behind the legacy netting this page says pre-September 2021 systems keep. Accessed August 17, 2026.
  5. U.S. Energy Information Administration (EIA). Electric Power Monthly. The Kentucky statewide average residential price used for scale. The source for the roughly 10.6 to 11 cent retail range this page measures export credits against. Accessed August 20, 2026.
  6. Internal Revenue Service (IRS). One, Big, Beautiful Bill Provisions. Guidance on the Public Law 119-21 termination of the Section 25D residential credit for systems whose installation is completed after December 31, 2025. Behind the line that the federal residential credit has been gone since December 2025. Accessed August 20, 2026.
Dean Mahmoud
Written by
Chief Executive Officer

Dean Mahmoud is the CEO of EcoGen America. He has connected tens of thousands of homeowners with residential solar installers across all 50 states since 2021, and works directly with installation companies on solar pricing, financing, and what homeowners actually pay for rooftop solar.

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