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Solar by stateSeptember 2026

Solar in Kentucky: how the rules work

How Kentucky credits the power solar panels send back to the grid, what homes there pay for electricity, and what to check when a home with solar is bought or sold.

Export credit
Reduced credit
About 67% of retail
Largest utility
Kentucky Utilities (KU, LG&E and KU / PPL)
Home electricity
14.3¢/kWh
Rising ~2.3%/yr over 10 years (EIA)
Typical installed price
$2.52/W
State average quote before incentives (EnergySage)

How exported power is credited

Power sent to the grid is credited at a set share of the retail rate, below what the home pays for power it buys.

SB 100 (2019) let the PSC set non-1:1 export rates. KU customers on NMS-2 (in service on or after September 25, 2021) are billed per billing period: the utility nets the dollar value of all energy consumed at retail against the dollar value of all energy exported. Exports are credited at a fixed rate, set at 7.366 cents/kWh in the September 2021 order. The 2025 rate case (Case 2025-00113) orders of February 16, 2026 and a March 4, 2026 correction kept it at $0.07534/kWh (the rate in effect since Aug 30, 2024; the Feb 16 appendix had listed $0.11226 in error). The KU residential RS energy charge is $0.11226/kWh (effective February 16, 2026, excluding riders), plus a $0.57/day basic service charge. Unused dollar credits carry forward indefinitely but are forfeited when service ends. For comparison, the LG&E NMS-2 rate was corrected to $0.07089. Grandfathering: systems in service before September 25, 2021 stay on NMS-1 1:1 kWh netting for 25 years from interconnection, per KRS 278.466. Share basis: 7.534 vs 11.226 cents base energy charge, so a lower ratio if riders are included.

What changes for a home with solar

A savings estimate that assumes full retail credit for exported power overstates the value of that power for systems on the current rules. Power used in the home still offsets the full retail rate.

Older systems are often grandfathered on earlier, better terms for a set number of years. Which rules a particular system is on depends on its interconnection date, stated in the note above.

Electricity here costs about 14.3¢ per kWh (2026) and has risen about 2.3% a year over the last decade. A lease or PPA escalator above that pace makes the solar payment rise faster than utility rates have.

When a home with solar is sold in Kentucky

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Sources

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