Home solar in Michigan

Net metering Replaced by a lower credit

Full net metering was replaced by the Distributed Generation (DG) program for utilities regulated by the Michigan PSC (DTE, Consumers and others). You pay the normal retail rate for every kWh you pull from the grid (inflow), and get a monthly bill credit for each kWh you send out (outflow) that must 'reflect cost of service' (in practice, based on the power-supply part of the rate, not delivery). Unused credits carry forward. Systems may be sized to make up to 110% of your last 12 months of use; the 2023 clean energy law raised the program cap from 1% to 10% of each utility's peak load. Source

• 2017-04-20: DG program law (PA 342 of 2016) takes effect
• 2024-02-27: PA 235 of 2023 raises DG cap to 10% of peak load

Solar credits (SRECs) No market

Michigan has no SREC market or solar carve-out. Utilities may buy RECs, but there is no program paying homeowners for them. Source

Taxes

Property tax: Exempt: home solar that offsets your own use is left out of your home's taxable value, and small systems (under 150 kW) are exempt from personal property tax (laws signed November 2019).
Sales tax: None: Michigan has no sales tax exemption for home solar equipment. Source

Solar laws

• PA 235 of 2023 (Clean and Renewable Energy and Energy Waste Reduction Act amendments) (2023). Raised the DG program cap from 1% to 10% of each utility's average peak load, half reserved for systems 20 kW or smaller. In effect February 27, 2024. Source
• Homeowners' Energy Policy Act, HB 5028 (2024). Signed July 10, 2024. Voids HOA rules that bar homeowners from installing, maintaining or using solar panels and other energy-saving upgrades. Source
• Solar property tax exemption (HB 4069, HB 4465, SB 47) (2019). Restored the property tax exemption for home and small business solar that lapsed in 2012. Source

Community solar

Not yet: Michigan has no statewide community solar law; bills (HB 6041, SB 518/519) are stuck in committee as of late October 2026.

Timeline

1. 2017-04-20 Distributed generation (inflow/outflow) law takes effect
2. 2019-11 Solar property tax exemption restored
3. 2024-02-27 DG program cap raised to 10% of peak load
4. 2024-07-10 HOA solar law (HB 5028) signed
5. 2025-12-31 Federal 30% homeowner tax credit (25D) ends
6. 2026-06-04 Community solar bill HB 6041 introduced
7. 2026-12-31 2025-26 session ends; pending community solar bills die if not passed

Federal tax credits

The 30% federal tax credit for homeowners who buy solar (Section 25D) ended for systems placed in service after December 31, 2025, so buying no longer earns a federal credit. If you lease or sign a power purchase agreement (PPA), the panels belong to a company that may still claim a business credit under federal deadlines that tighten through 2027. Ask your installer whether that savings is in your price.

Sources

• MCL 460.1173 Distributed generation program (rendered Oct 23, 2026)
• Solar Power World: Michigan governor signs HOA solar bill
• pv magazine: No property tax for residential solar in Michigan
• Michigan Advance: community solar bills languish (Oct 2026)
• MPSC DTE outflow credit order (power supply component)

Last checked 2026-11-01. Incentives are not guaranteed and can change or run out. Confirm every figure with your utility, installer and a tax professional before you sign. This page is general information, not tax, legal or financial advice.

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