Mississippi Solar – Everything You Need to Know


Information about Solar Panels in Mississippi

Mississippi’s electricity rates and great sunlight give solar the perfect soil to bloom. Unfortunately, without a renewable portfolio standard and any decent net metering, the state isn’t doing much to grow Mississipi solar and renewable energy in any way.

Even still, going solar in Mississippi can help you save money and add value to your home at the same time. Take a look below for savings estimates as well as an overview of important solar policies and incentives.


#1 Are Solar Panels in Mississippi Worth it?

Overall Grade
14 years Avg. Payback Time (For Cash Purchase)
5.9 % Estimate IRR (Return on your investment on cash purchase over 25 years)
$12,889 Your Net Profit Over 25 Years (Cash Purchase)

* Note that these are estimated values for informational purposes only, and do not take into account the full complexity of all financial projections. They also only apply to cash purchases, which means your numbers will be different if you lease your system or pay for it with a loan (factoring in interest). Also note that we are not financial advisors, so this information should not be construed as financial advice.

#2 Options for Buying Solar Panels in Mississippi

With Mississippi’s electricity rates, saving money with solar is fairly easy. While you won’t save as much as homeowners in states with full retail rate net metering, installing solar can benefit you as well as the environment.

Cash Upfront

Purchasing your solar installation in cash nets you the highest savings possible. It’s a simple transaction (you pay the installer, they install, you’re done), lets you take advantage of the federal tax credit, and potentially adds value to your home.

The obvious downside, of course, is that you have to bring all that investment to the table up front. With a medium-sized 5kW installation costing around $17,650 (or $3.53 per watt) in Mississippi, that’s certainly no easy task! But that’s not the whole story.

As the owner of the installation, you’re eligible for the federal solar tax credit, worth 30% of your total installation cost. After the first year, it drops your total investment to $12,355 – still quite a bit, but much less than the original sticker price!

And when we look at the total savings you can see over the life of your 5kW installation, you’ll see just how sweet solar can be.

During the first year, your 5kW installation in Mississippi will produce about 7,052 kilowatt-hours, worth about $820 if you purchased that same amount from the utility (at the state average of a bit less than $0.12 per kWh).

As the years go on and your installation consistently spits out energy, your utility will continue to raise prices – around 2.5% each year in Mississippi – allowing you to save more and more money. After 25 years (the typical life of solar panels), you’ll have pocketed about $12,889 in net savings.

While nearly $13k in savings is great, it does come with a giant caveat. Due to Mississippi’s unique net metering rates (see section below for more details), you’ll receive only a portion of the retail rate for any electricity you produce that goes into the grid.

Depending on how much of your electricity you’re able to immediately use, this low net metering rate can cut into your total financial savings. Use the calculations above as a guide, but don’t be surprised if your savings are a bit lower. For the most accurate estimate of savings, you’ll need to talk to a few local installers well versed with your utility’s policies.

Bottom Line: All that being said, paying for a system in cash is the most sure-fire way to save money by going solar in Mississippi and even without great net metering, you can still save thousands..


Solar leases and power purchase agreements (PPAs) in Mississippi are DOA. The legality of PPAs is unknown and the big companies that offer these financing options – like SolarCity and Sunrun – have yet to enter the state, likely due to the low net metering incentives.

While it’s certainly a disappointment that leases and PPAs are a non-starter in Mississippi, this type of financing is actually dying off with the rise of solar loans, which offer the same benefits (going solar for no money down) but with higher savings.

Bottom Line: Even if you don’t have the cash to purchase your installation, you’re not totally out of options! Take a look a look at solar loans, which also offer a chance to go solar for little to no money down.

More: Solar Leases


Solar loans offer a great alternative to shelling out the cash for an outright purchase.

In solar-dense states like California and Colorado, solar installers, credit unions, banks, and even dedicated loan companies all offer loans for solar installations. In areas like Mississippi, though, it’s probably best to reach out to a few local installers to see what options are available.

As mentioned, the main draw of a loan is avoiding paying all that money upfront, though there are other benefits, too. Since you still own the system, you’re eligible for the federal tax credit. As the system owner, the installation can add value to your home as well (more on this later).

The main drawback, of course, is the interest payments. They can really eat into your savings if you’re not careful.

For example, if you installed the same 5kW installation as above, but took out a 15-year loan with 5% interest to pay for it, you’d rack up $7,474 in interest. With this added expense, your net savings drop to $5,415.

Of course, there are tricks to lower your interest payments. First, shop around and find the shortest loan with the lowest interest rate. Second, throw in a nice down payment to drop your financed amount.

Lastly – and this is a good one – remember the federal tax credit? Well, take the money you would’ve spent to pay those taxes and pay off your solar loan instead. That $5k can go a long way towards lowering your interest payments!

Of course, the savings estimate above is also prone to the same caveat as with a cash purchase: with Mississippi’s low net metering rates, your actual savings will vary depending on your energy habits. Talk to a few installers to get a customized estimate of your savings.

Bottom Line: If you don’t have the cash, loans are a great way to go solar, save money, and help the environment.

More: Solar Loans

#3 Mississippi Solar Policy Information

Mississippi has adopted a couple of good policies towards solar but they are neither cohesive nor well-rounded.


Renewable Portfolio Standard

Mississippi is one of only 13 states that have yet to pass any form of renewable energy goals, known as Renewable Portfolio Standards (RPS).

When states get serious about lowering their own emissions and want to encourage (or force) utilities to install solar, wind, and other technologies, they’ll typically create an RPS. The RPS mandates that utilities (as they are the ones who produce and sell electricity) must source a certain percentage of all the electricity they sell from renewable energy by a specific date.

Of all the states, Hawaii has the most aggressive goals – 100% renewable by 2045 – followed by California, New York, and Oregon (50% by 2030, 2030, and 2040 respectively).

Along with other southern states like Alabama, Tennessee, and Arkansas, Mississippi has not yet adopted any RPS mandates.

Without it, utilities don’t have any real incentive or push to adopt renewable energy themselves or encourage it among its customers, leading to a stagnant solar industry.

Until the state moves forward with something similar, we can assume the Mississippi solar industry will continue to meander along.

More: Renewable Portfolio Standard (RPS)

Electricity Prices

Electricity prices can make or break the finances of any solar installation. High electricity prices mean high savings. Low prices mean lower savings and a longer return on your investment.

At $0.12 per kWh, Mississippi residents enjoy fairly average electricity prices. They’re about $0.01 lower than the national average and on par with prices in nearby Alabama, Kentucky, and Tennessee.

Current electricity prices aren’t the only factor that can affect savings. As we already mentioned, utilities raise rates every couple of years as well! In fact, the rate at which prices increase plays a huge role in your total savings. If they raise rates quickly, you can save more over the life of your installation.

Over the last 16 years, Mississippi utilities have raised rates an average 2.5% each year, right in line with the US average of 2.6%.

So while electricity isn’t breaking the bank in Mississippi, the steady rise in prices means solar is a long-term investment that can lead to deep savings over 25 years.

Net Metering

Since 2015, all utilities operating in Mississippi must offer net metering to its customers. This is great news. With net metering, homeowners can financially benefit from all the electricity their installation produces, even if they don’t use it and it goes into the grid. This allows for a faster return on investment for your installation and higher total savings. However, there is a downside to Mississippi’s net metering regulations.

Unlike other net metered states, where utilities must provide bill credits for excess generation at retail rate (ie, if you pay $0.13 per kWh, you receive credit for $0.13 per kWh for all electricity you put into the grid), privately-owned utilities in Mississippi (like Mississippi Power) provide credits based on their avoided cost (ie, what they would pay to produce that electricity, typically around $0.03 per kWh) plus a $0.025 per kWh premium.

Due to this lower net metering rate, the value of the electricity you put into the grid is lower than it could be. So while you’re certainly benefiting from the net metering, it’s not quite good enough to see the solar explosion that other states have enjoyed.

Mississippi also requires electric cooperatives in the state to offer net metering, but doesn’t specify how excess electricity is credited to your account. If you’re a co-op customer, you’ll need to call up your utility to find out exactly how their net metering works.

More: Net Metering

Interconnection Rules

Mississippi also introduced interconnection standards in 2015, another great step towards encouraging solar in the state.

Interconnection is the approval process to connect your solar installation to the utility’s electrical grid. Historically, utilities could all require different processes, requirements, and fees, leading to very different (and sometimes very poor) experiences for homeowners across the same state.

To combat this issue, states pass interconnection standards that all utilities must obey. All privately-owned utilities in Mississippi must obey these rules, which mandate that for systems under 20kW (which includes most residential installations):

  • Utilities must respond to applications with a status update within 10 days, and approve or deny the request within 15 days;
  • Utilities cannot require additional liability insurance (which can increase installation costs);
  • Utilities cannot require additional external disconnect switches. (A safety measure typically required of larger installations – while not a huge deal, it also increases installation costs.)

Your installer will likely take care of your net metering and interconnection applications, but it’s certainly good to be aware of the process and requirements. Overall, connecting your system to the grid should be fairly easy and straightforward!

Homeowners Associations and Solar Access Laws

You can imagine the situation: The local HOA doesn’t like the looks of solar, and denies approval of any installation in the neighborhood. Or a neighbor plants a tree right in front of your panels, blocking the sun and turning your expensive solar investment into some weird roof-top modern art that produces no electricity.

In these situations, what do you do?

Solar heavy states typically pass regulations protecting both homeowners’ right to go solar as well as the right to sunlight – two issues that have popped up in court over the last 20 years, as solar has grown in popularity.

With relatively few solar installations in Mississippi, not too many homeowners have had to deal with these issues and no laws exist to offer any protection for solar homeowners. If solar does start to explode, though, these are serious concerns that will need to be dealt with on a large-scale.

Until then, if you’re installing solar, notify your HOA and neighbors of your plans as early as possible. Stay friendly, flexible, and answer any questions cheerfully. Good relationships are your best recourse when laws aren’t there to back you up!

#4 Mississippi Solar Incentives, Rebates, and Tax Credits

If you’re looking for a huge list of incentives, Mississippi is not your place. However, even with just the federal tax credit, you’re still getting a severely discounted installation!


Federal Tax Credit

In Mississippi, and indeed across the US, the federal tax credit (or Solar Investment Tax Credit, or ITC) is the single best incentive for homeowners going solar. This credit lets you write off 30% of the cost of your solar installation on your federal income taxes.

The credit is nonrefundable, so the government won’t write you a check if your annual tax return is below $0, but you can break the credit down in small increments and claim portions over several years to enjoy the full amount.

With this tax credit, an $18k installation allows you to avoid paying $5,400 in taxes, dropping your total investment to $12,600. That’s the power of the ITC!

The credit was originally meant to expire in 2016, but at the last minute, federal lawmakers extended the full credit to the end of 2019. In 2020, it drops to 26%, then 22% in 2021. At that point, unless it gets re-extended, it’s toast.

More: Solar Federal Tax Credit

State Tax Credit

Mississippi offers no state tax credits for going solar.

TVA Green Power Program

If you’re looking to make some cash from your solar installation and are customer of a TVA utility, check out their Green Power Program. Through this incentive program, TVA purchases 100% of the electricity your installation produces for the next 20 years. During Years 1 to 10, TVA will pay retail rate plus a $0.02 premium for all electricity. From Years 11 to 20, they’ll pay only the retail rate (which is still pretty good).

TVA offers this program in several states and it comes with the same caveats in each. While the program offers you a chance to pocket some cash, you forgo the opportunity to actually use any of the clean electricity you are producing, as TVA purchases ALL of it.

If you’re looking to install solar so you can run your life on clean energy, this program might not make sense. You’re still putting out carbon-free electricity – and it is being used – but it won’t be by you. However, if you just want to help the environment and make some money, it’s certainly an option!

Property Tax Exemption

Mississippi doesn’t offer any property tax exemptions on the additional value a solar installation brings to a home. Many states allow homeowners to exempt this value for a certain time period (up to 10 years for instance) or even indefinitely. These exemptions don’t save you huge amounts of money, but every penny saved, right?

Sales Tax Exemption

Mississippi offers no sales tax exemptions for solar installation.

Many states do offer this incentive, which allows homeowners to typically save a few hundred bucks depending on the sales tax rate. Unfortunately, this just isn’t the case in Mississippi.

However, these tax incentives are small potatoes when compared to the federal tax credit, so don’t be too disappointed!

General Increase in Home Value

Installing solar panels on your roof can add thousands of dollars to the value of your home.

In a 2015 study, the Lawrence Berkeley National Lab looked at the sale prices of 22,000 homes in 8 states (though not including Mississippi) from 1999 to 2013, including 4,000 homes with solar. They found that as long as the solar installation was owned by the homeowner, solar can add about $4 per watt on average to the home’s value, depending on the age of the home.

While the value in Mississippi could certainly be lower than this, even at half this rate a 5kW installation could potentially add an extra $10k in value, balancing out almost your entire investment right there!

Of course, before moving forward, talk to a few local installers or real estate agents to get the inside scoop for your area. While the above obviously speaks volumes about the value of solar for the country as a whole, your specific area might be different.

More: Buyers Will Pay More for Solar Homes

If you’d like to dig even more on local incentives and rebates, check out the DSIRE database.

#5 Jackson Solarjackson-mississippi

If you’re in the Jackson area and want to go solar, you’ll have a very similar experience to anyone else in the state. You’re eligible for the federal tax credit and net metering and, just like across the country, installing and owning solar can add value to your home as well.

Entergy, the electricity provider for the Jackson area, uses a tiered rate structure for residential customers. For the first 500 kWh you use each month, you’ll pay $0.09 per kWh. After you hit 500 kWh, you’ll pay $0.07 per kWh. In essence, the more electricity you use, the less you pay – it’s like bulk discounts.

Many states use the tiered approach, but in an entirely different manner. Instead of offering cheaper electricity as you consume more, you actually pay a higher rate as you consume more! The idea is to encourage customers to use less electricity.

Obviously, this isn’t the case with Entergy and be sure your installer is accounting for these lower prices in all the savings estimates they provide.

Entergy also charges a flat monthly fee of $6.75 no matter how much electricity you use, so be sure to take this into account as well when estimating your savings.

What to Do Next?mississippi-memorial

Going solar in Mississippi can save you a good amount of money, especially if you finance with cash. If you must take out a loan, remember to shop around for the best deal, as interest rates and loan lengths greatly affect your total savings.

Don’t forget about Mississippi’s, uh, unique net metering rates – if you ignore them and don’t factor them into your savings calculations, they could come back to bite you later on.

The best policy is to talk to several local installers to get a personalized quote that accounts for your own utility rates, energy use, and needs.

Image Credit under CC License via Pixabay - 1, 2 & Flickr - 34, 5

  • by Ryan Austin
  • |
  • July 27, 2017
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