Michigan Solar Incentives After the $156M Cuts: What Households and Farmers Need to Know Now

How Federal Solar Cuts Are Reshaping Michigan’s Incentives and Energy Future

Michigan solar advocates were dealt a blow when the Trump administration canceled $156 million in Solar for All funding, part of a nationwide rollback of $7 billion in solar grants (Reuters). For households, farmers, and communities, this changes the landscape of solar adoption in 2025—and raises new questions about where savings will come from moving forward.

What Was Lost in the Solar for All Rollback

$156M earmarked for Michigan was intended to expand rooftop and community solar, battery storage, and workforce training.
The program promised $400 in average annual bill savings and nearly 700 local clean energy jobs (Michigan Independent).
Farmers were positioned to benefit through agrivoltaics and dual-use projects that could diversify income streams.

What Incentives Are Still Available in Michigan

Despite federal cuts, Michigan homeowners and farmers still have strong opportunities to save on solar:

Federal Solar ITC (30%): Still in effect through 2032 covering solar panels, storage, labor, and permitting. A $20,000 system means a $6,000 tax credit.
Michigan Property Tax Exemption: Added home value from solar is not taxed, keeping costs down.
Sales Tax Exemption: Michigan waives sales tax on solar equipment.
Utility Programs: Select utilities still offer rebates and bill credits through net metering.
Renewable Energy Certificates (RECs): Larger farms and commercial systems can still earn tradable credits per MWh produced.

Implications for Michigan Households

Higher Barriers for Low-Income Families: Without Solar for All’s subsidies, community solar may be less accessible, making equity a challenge.
Longer Payback Periods: Payback for residential systems may lengthen by 1–2 years without added grants, though most households will still see strong ROI in 7–10 years.
Urgency to Act: With solar ITC reductions looming in 2033, 2025 remains one of the best times to install.

Implications for Michigan Farmers

Fewer Pilot Programs: Farmers looking at agrivoltaics may see less startup support.
Increased Financing Needs: Without federal backing, farmers must rely more on private lenders, CDFIs, or state green bank tools.
Resilience Still Matters: For livestock, specialty crops, and water conservation, agrivoltaics continues to offer tangible benefits, even without grants.

What Huge Changes Are in Store Moving Forward

Shift to State Leadership: Expect Lansing to consider new solar carve-outs and agrivoltaic incentives to keep momentum alive.
Private Capital Steps In: ESG funds and private lenders may replace federal dollars but will demand stronger ROI metrics.
Consumer Divide: Wealthier households will continue to adopt solar, while low-income families risk being left behind unless Michigan develops local solutions.
Innovation Out of Necessity: Expect more efficiency-focused solar designs, new financing models, and broader agrivoltaic adoption as farms seek resilience.

Final Thoughts

The $156M funding loss is a setback, but Michigan solar is far from finished. Households can still capture major savings through the 30% federal ITC and state exemptions. Farmers exploring agrivoltaics must lean more heavily on private and state-level support. What’s clear is that solar in Michigan will continue to grow but the pace and equity of that growth now depend more on local innovation than federal dollars.

Michigan Solar Partners