Pennsylvania's solar market is growing, offering both homeowners and commercial property owners significant opportunities to harness renewable energy. Electricity costs in Pennsylvania hover around 18.12 cents per kilowatt-hour, slightly higher than the national average, implying that solar panel usage could lead to higher-than-average energy savings! Further enhancing your potential savings, Pennsylvania provides solar incentives, including Solar Renewable Energy Certificates (SRECs) for residential solar systems - a benefit not all states offer. The state also supports a net metering program. Here’s everything you need to know to join Pennsylvania’s solar programs. Pennsylvania Solar Tax Exemptions Federal Solar Tax Credit The federal solar tax credit, also referred to as the Investment Tax Credit (ITC), is a national incentive that allows individuals to obtain a tax credit for the costs associated with installing solar panels. This credit offers solar owners a 30% deduction on their total system expenses. For example, if you buy a 10 kilowatt (kW) system for $33,000, your tax credit would equal $9,900. Additional local incentives can be utilized, including exemptions from Texas’ sales and property taxes. In 2020, the federal tax credit for solar decreased to 26% but was reinstated to its original rate of 30% in 2022 by the Inflation Reduction Act. This credit will remain accessible until 2034, with a gradual phase-out planned. Here is the schedule: The credit will decrease to 26% in 2033 The credit will decrease to 22% in 2034 Unless renewed by Congress, the credit will phase out entirely in 2035 Pennsylvania Local Solar Exemptions Pennsylvania SREC Program In Pennsylvania, you can receive Solar Renewable Energy Certificates (SREC) when you produce your own power via solar photovoltaic (PV) systems. However, as of 2023, it's important to note that unlike other states, there are no extra state incentives available for solar panel installations, such as exemptions on sales or property taxes, or state income tax credits. What is an SREC Program In Pennsylvania, the Solar Renewable Energy Certificate (SREC) program provides an opportunity for you to generate certificates for every 1,000 kilowatt-hours (kWh) produced by your solar system. These certificates can subsequently be sold to local electric utilities that are required to meet certain clean energy standards. It's important to highlight that SRECs serve as a production incentive. This means you can accumulate SRECs for not only the solar electricity consumed in your household but also for any surplus power fed back into the grid or stored in a solar battery. The Pennsylvania Alternative Energy Portfolio Standard (AEPS) has established an 18% clean energy requirement for investor-owned utility companies and electricity providers. The companies who need to comply with this law can meet the requirement by : Directly generating or purchasing renewable energy. Purchasing alternative energy credits from homes and businesses. How Much Does an SREC Go For in 2023? Pennsylvania residents with solar panels can sell SRECs to local electric utilities at varying rates. You can check SRECTrade to see the current market rate, which has fluctuated between $30 and $45 in recent months. SRECs are generally sold through brokers that charge a small fee but handle the complex paperwork required to complete the transaction. Philadelphia Solar Rebate Program Under the Philadelphia Solar Rebate Program, residential homeowners who set up photovoltaic systems can receive an incentive of up to $0.20 per watt, while businesses are offered $0.10 per watt. For example, a residential solar system with a capacity of 6 kW could be eligible for a rebate of $1,200, while a commercial setup of 200 kW might receive a $20,000 rebate. The program has the following eligibility requirements: Your solar energy system must be installed in Philadelphia. You must have permission to operate from PECO, received no earlier than July 1, 2019. You must be current with all city taxes and payments. You cannot have any unresolved building code or property code violations. Net Metering in Pennsylvania Pennsylvania boasts a positive net energy metering policy, established initially by the Public Utilities Commission (PUC) in 2006. This scheme compensates you for any surplus power your solar panels produce at the full retail rate, which can be applied to your subsequent energy bills, and any leftover credit can be carried forward to the ensuing month. The state extends net metering for home-based solar systems with a capacity of up to 50 kW and for non-residential systems that reach up to 3,000 kW. Furthermore, net metering isn't exclusive to solar energy. How to Sign Up for Net Metering in Pennsylvania Despite Pennsylvania's broad net energy metering policy, the application conditions can differ based on your specific utility provider. PECO, the biggest utility company in Pennsylvania, serves over 1.7 million electric customers and 545,000 natural gas customers. PECO runs the state's most extensive net metering program, offering comprehensive information on its website about electricity tariffs associated with net metering and guidelines for interconnection. Depending on the scale of your solar installation, PECO applies varying application fees. For instance, solar systems up to 10 kW are subject to a $100 application fee Pennsylvania Solar Resources Solar Energy Resource Hub - Pennsylvania Pennsylvania Solar - Solar Energy Industries Association Pennsylvania Solar Energy Co. Let US Solar Supplier guide your solar energy project! Consult with us today to match the perfect system to your needs.
