The average residential electricity rate in Michigan is about 22.0 cents per kWh (EIA, as of May 2026), and a typical 7 kW rooftop system produces about 9,034 kWh a year in Detroit (NREL PVWatts v8). Michigan retired traditional net metering: under the utility Distributed Generation programs at DTE Energy and Consumers Energy, the power you use on-site offsets at the retail rate, but energy you export is credited at a lower outflow rate (near 8 cents per kWh at DTE), so simple payback runs about 11 years. Michigan also has no state solar tax credit, and the 30% federal Residential Clean Energy Credit ended December 31, 2025. Below you will find installed cost, per-city production, how each utility handles the inflow/outflow tariff, and the state incentives that remain, updated for 2026.
Updated for 2026.
Key statistics: Michigan solar at a glance (2026)
Key numbers (Michigan, 2026)
- Average residential rate: 22.0 cents per kWh
- Typical system size: 7 kW
- Typical annual production: 9,034 kWh per year (Detroit)
- Typical installed cost: $2.70 to $3.30 per watt
- Estimated system cost: $18,900 to $23,100
- Simple payback: about 11 years
According to MySolarFY’s analysis (August 2026), a typical 7 kW system in Michigan produces about 9,034 kWh a year in Detroit, offsetting power that costs about 22.0 cents per kWh. Michigan is a fast-growing solar market: the state has about 3.2 GW of solar installed, enough to power roughly 540,000 homes, and added 946 MW in 2025 to rank 10th nationally for new solar that year (SEIA, as of 2026). These are our own compiled figures for Michigan; see Methodology below for exactly how each was produced. For the statewide rules behind these numbers, see our Michigan solar guide. Comparing states? See our Maine solar data and statistics for a side-by-side.
| Metric | Value | Source (dated) |
|---|---|---|
| Average residential rate | 22.0 cents per kWh | EIA, as of May 2026 |
| Typical system size | 7 kW | MySolarFY, typical residential array |
| Typical annual production | 9,034 kWh per year (Detroit) | NREL PVWatts v8, as of August 2026 |
| Typical installed cost | $2.70 to $3.30 per watt | MySolarFY cost range, as of August 2026 |
| Estimated system cost | $18,900 to $23,100 | MySolarFY, 7 kW, as of August 2026 |
| Simple payback | about 11 years | MySolarFY analysis, as of August 2026 |
| Solar installed statewide | about 3.2 GW (roughly 540,000 homes powered) | SEIA, as of 2026 |
Every figure is dated and attributed. Rate is the EIA residential average for Michigan; production is a modeled NREL PVWatts v8 run for a 7 kW array; cost and payback are MySolarFY estimates for planning, not a quote. Installed-capacity figures are from SEIA. Confirm current terms before you decide.
How much does solar cost in Michigan, and what is the payback?
A 7 kW system runs about $18,900 to $23,100 installed in Michigan before incentives, with a simple payback near 11 years based on local production and the 22.0 cent retail rate. Payback is best-case here: it assumes you use most of your production on-site at the retail rate, because energy you export is credited at your utility’s lower outflow rate, not full retail (see the net billing section below). Production and payback vary within the state because the solar resource and the local rate shift by location. The table below models a 7 kW system for representative Michigan cities using NREL PVWatts v8.
| City | System size | Annual production | Est. system cost | Est. annual bill savings | Simple payback |
|---|---|---|---|---|---|
| Detroit | 7 kW | 9,034 kWh per year | $21,000 | up to about $1,990 | about 11 years |
| Grand Rapids | 7 kW | 8,867 kWh per year | $21,000 | up to about $1,950 | about 11 years |
| Lansing | 7 kW | 8,960 kWh per year | $21,000 | up to about $1,970 | about 11 years |
| Ann Arbor | 7 kW | 9,117 kWh per year | $21,000 | up to about $2,010 | about 10 years |
Production is a modeled NREL PVWatts v8 run per city ZIP. Bill savings value each kWh you use on-site at Michigan’s roughly 22.0 cent retail rate; this is a best-case figure because energy you export is credited at your utility’s lower outflow rate (near 8 cents per kWh at DTE), not at retail, so a home that exports a large share will save less and take longer to pay back. Cost and payback are MySolarFY estimates that hold today’s rate flat and ignore financing. A written quote for your roof beats any table.
Did Michigan end net metering? Utility rate and net billing comparison
Yes. Michigan phased out traditional 1:1 net metering under the 2016 energy law and replaced it with a Distributed Generation inflow/outflow tariff at each major utility. You still offset the power you use on-site at the retail rate, but the energy your panels export is credited at a lower outflow rate set by the utility, not at full retail. Your utility sets the delivery rate and administers this credit, not the installer. See how net metering and net billing credit your solar exports for the mechanics.
| Utility | Residential rate | Net billing treatment |
|---|---|---|
| DTE Energy | about 18 to 22 cents per kWh all-in (residential) | Distributed Generation inflow/outflow tariff; exports credited near 7.75 cents per kWh, well below retail (traditional net metering ended) |
| Consumers Energy | about 18 to 22 cents per kWh all-in (residential) | Distributed Generation program; exports credited at the power supply rate, below retail (net metering closed to new residential customers in 2021) |
Net billing rules are set by state law and the Michigan Public Service Commission, not the installer. Outflow credit rates change with each utility’s tariff filings, so confirm your utility’s current terms before you size a system.
What solar incentives does Michigan offer in 2026?
Michigan has no state solar tax credit and no statewide cash rebate in 2026, so the main financial benefit is the bill offset you earn under your utility’s Distributed Generation program. State programs and net billing credits go to the system owner, so on a lease or PPA the company that owns the panels keeps the incentive while the bill credit follows your account.
Distributed Generation program (net billing)
Solar you use on-site offsets power at the retail rate, but energy you export is credited at a lower outflow rate set by your utility (roughly 8 cents per kWh at DTE), not at full retail. This replaced traditional net metering statewide (active) (Michigan Public Service Commission and utility DG tariffs, as of August 2026).
No Michigan state solar tax credit
Michigan does not offer a state income tax credit or statewide cash rebate for residential rooftop solar. The value comes from bill offset under the DG program, not a state credit (none in 2026) (Michigan Department of Treasury, as of August 2026).
The federal homeowner credit has ended, but Michigan’s utility programs have not. The 30% federal Residential Clean Energy Credit (Section 25D) ended December 31, 2025, so a Michigan homeowner who buys solar with cash or a loan in 2026 cannot claim it (IRS Residential Clean Energy Credit, as of 2026). The Distributed Generation credits above were not affected by that change. For the full timeline, see what the federal solar tax credit change means and our state solar incentives overview.
Methodology and sources
- Electricity rate: the latest EIA Form residential retail price for Michigan (EIA retail sales, as of May 2026).
- Production: modeled with NREL PVWatts v8 for a 7 kW south-facing array at each city ZIP (NREL PVWatts v8 documentation, as of August 2026).
- Cost and payback: MySolarFY estimates built from installed cost per watt (informed by the DataForSEO cost SERP for Michigan) and the EIA rate, holding today’s rate flat and ignoring financing.
- Installed capacity: Solar Energy Industries Association state data for Michigan (SEIA Michigan, as of 2026).
- Incentives and net billing: the Michigan Public Service Commission, the utility Distributed Generation tariffs, and the DSIRE incentive database (DSIRE, as of August 2026).
- Assumptions: a 7 kW system, standard losses, and a south-facing array. Your roof, usage, and financing change the result, so treat these as planning figures, not a quote.
Citing this data
Citing this data?
Cite as: “MySolarFY, Michigan Solar Data & Statistics 2026, accessed August 22, 2026.” Data compiled by MySolarFY from EIA (residential electricity rate), NREL PVWatts v8 (modeled production), SEIA (installed capacity), DSIRE and the Michigan Public Service Commission (incentives and net billing), and DataForSEO (cost SERP). Figures are dated in each table above.
Journalists and researchers may quote these statistics with attribution to MySolarFY and a link to https://mysolarfy.com/michigan-solar-data-statistics-2026/.
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How to choose a solar installer in Michigan
Rather than chasing a “best installer” list, screen any company against objective criteria: NABCEP certification, a valid Michigan license, a written workmanship and equipment warranty, real experience with DTE or Consumers Energy interconnection, and a transparent quote that uses today’s outflow-credit values. For a checklist, see the right questions to ask a solar installer. MySolarFY matches you with licensed installers that serve your area so you can compare real local quotes side by side, with no obligation.
Frequently asked questions
What is the average solar cost in Michigan in 2026? A typical residential system in Michigan runs about $2.70 to $3.30 per watt installed before any incentives, or roughly $18,900 to $23,100 for a common 7 kW system (MySolarFY cost range, as of August 2026). Cost varies with roof, equipment, and installer, so use a written quote for your own numbers.
How much electricity does a solar system produce in Michigan? A modeled 7 kW array produces about 9,034 kWh a year in Detroit, and roughly 8,900 to 9,100 kWh across Grand Rapids, Lansing, and Ann Arbor (NREL PVWatts v8, as of August 2026). Production drives both your export credits and your payback, so estimate your specific roof rather than a generic number.
Did Michigan end net metering? Yes. Michigan replaced traditional 1:1 net metering with a Distributed Generation inflow/outflow tariff under its 2016 energy law. You still offset on-site use at the retail rate, but exported energy is credited at a lower outflow rate (near 8 cents per kWh at DTE), not at full retail (Michigan Public Service Commission and utility DG tariffs, as of 2026).
Did the federal solar tax credit end? Yes for homeowners. The 30% federal Residential Clean Energy Credit (Section 25D) ended December 31, 2025, so a Michigan homeowner who buys solar in 2026 cannot claim it (IRS, as of 2026). Michigan has no state solar tax credit either, so the value comes from the utility net billing credit, not a tax break.
Reviewed by the MySolarFY team. Figures were verified against the linked EIA, NREL, SEIA, DSIRE, and Michigan Public Service Commission sources as of August 2026; rates, incentive values, and net billing terms can change, so confirm current terms before you decide. MySolarFY does not provide tax or financial advice; consult a licensed professional. Learn more about the MySolarFY team and how we work.
MySolarFY is a free service that matches homeowners with licensed solar installers. We are not an installer, financing company, or government program. Solar panels are not free and any monthly payments apply. “No up-front cost” refers to qualifying lease or PPA financing, where eligible homeowners may have no out-of-pocket cost at installation; lease and PPA terms may include an annual escalator and total payments may exceed a cash purchase, and on a lease or PPA the incentives go to the company that owns the system. Homeowners do not get the federal residential credit that ended after December 31, 2025. Eligibility, savings, incentives, and rates vary and are not guaranteed. See our full disclaimer.