2023 Solar Incentives Guide for Allegheny, PA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Allegheny.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Allegheny?
High Performance Buildings Incentive Program
Commercial loans/loan guarantees: $2 million
Grants: Lesser of 10% of project costs or $500,000
Wind and Geothermal Incentives Program
Manufacturer grants: $5,000 per job created within 3 years
Loans for geothermal systems: $3 per square foot of space served up to $5 million; also limited to 50% of eligible costs for residential systems.
Loans for wind energy production projects: $5 million
Grants for wind energy production projects: $1 million
Grants for feasibility studies: 50% of cost up to $175,000
Loan guarantee grants: Up to 75% of deficient funds up to $5 million
Solar Alternative Energy Credits
High Performance Building Incentives Program
Duquesne Light Company - Residential Energy Efficiency Program
Central A/C / Heat Pumps: $100/ton
ENERGY STAR Certified Heat Pump Water Heater: $350
Solar Water Heater: $300
Ceiling/Floor/Wall Insulation: $0.23/square foot
ENERGY STAR Certified Dehumidifier: $20
ENERGY STAR Certified Refrigerator: $25
ENERGY STAR Certified Freezer: $10
ENERGY STAR Certified Room Air Conditioner: $25
ENERGY STAR Variable Speed Pool Pump: $200
Occupancy Sensor Based Control: $10
Smart Strip Surge Protector: $5
Furnace with High Efficiency Fan Motor: $100
Ductless Mini-Split Heat Pump: $100
Refrigerator/Freezer Recycling: $35
Duquesne Light Company - Residential Solar Water Heating Program
First Energy (MetEdison, Penelec, Penn Power, West Penn Power) - Residential Solar Water Heating Program
FirstEnergy (MetEdison, Penelec, Penn Power, West Penn Power) - Residential Energy Efficiency Programs
Clothes Washer: $25- $50
Clothes Dryer: $50
Fridge/Freezer Recycling: $50
HVAC tune up: $50
Furnace Fan Motor: $150
Ductless Minisplit AC : $200
Central AC: $100 - $200
Air Source Heat pump: $250 - $500
Geothermal Heat Pump: $600
Packaged Terminal AC: $75
Packaged Terminal Heat Pump: $150
Programmable Thermostat: $25
Solar Water Heat: $500
Heat Pump Water Heater: $500
Home Energy Audit: $250
Lighting: Available as in-store discount in participating stores
Federal Residential Renewable Energy Tax Credit
The phrase "solar incentives" refers to financial incentives designed to encourage the use of renewable energy by making installing and using solar panels more affordable. The incentives could include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are offered by the federal government, some by the state of Pennsylvania and some by your specific utility company, county or municipality. Types of solar incentives might include:
- Net Metering: Don't forget to talk with your Allegheny utility company about signing a net metering contract. This will allow you to get a credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You may receive either a dollar-for-dollar credit or a percentage of the value.
- Tax Exemptions: These could come in the form of property tax exemptions, which would allow you to exclude the value added by your solar panels when paying taxes on your home. You could also look for exemptions on sales tax at the time of purchase.
- Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the federal government. (This is different from a tax deduction.)
- Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are usually handled at the state level. Once your solar system meets the threshold (typically a small amount of energy production), you are eligible to receive SRECs that can be sold to your utility company or other buyers. The money you make is usually considered part of your taxable income.
- Rebates: A solar rebate is a partial refund given after you've purchased your solar system. Rebates may be offered by your local utility company, your county or your state. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some knowledge of. The Federal Solar Investment Tax Credit, or ITC, is the best-known federal solar incentive. The ITC allows you to claim a tax credit for a predetermined percentage of your solar system's cost.
The ITC can be applied to solar systems installed after January 1, 2006 and under this program you can deduct from your taxes a percentage of the total cost of solar panels, accessories, equipment and labor. You can receive this credit for solar panels installed on a primary or secondary residence that you own in the United States. The original amount you could claim was 30% of the total cost, although the amount you can claim may range between 26-30%. There is no maximum claim amount.
To find out exactly how much the ITC could save you, talk to your local Allegheny solar panel installation expert.
In August 2022, the ITC (now called the Clean Energy Credit) was bolstered by the passing of the Inflation Reduction Act. The new Clean Energy Credit is valid until 2035. You are now eligible for a 30% credit for solar systems installed between 2022 and 2032. This new credit will then decrease annually until the date of expiration. Beginning in 2023, it will also be easier to get credits for energy storage systems under this new program.
Click here to learn more about the new Inflation Reduction Act. To fully understand how the new Clean Energy Credit might apply to you, talk to your local Allegheny solar installation company.
State & Local Solar Incentives
Some solar incentives are often also offered at the local or state level. Similar to federal incentives, these can include tax credits, rebates and more. These incentives might be distributed by the Pennsylvania government, or by your county or municipality. Some incentives may be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Allegheny
Nationwide solar energy use has significantly increased in the past 15 years, in part due to the growth in the number of solar incentives. You can obtain these incentives from the Pennsylvania government, the federal government or your local utility company. Your local Allegheny solar panel installer can help you learn more about which incentives you might qualify for, and get you started on the path to switching to renewable energy today.
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EcoWatch's Allegheny, PA Solar Incentives FAQs
How do I know if I qualify for solar incentives?
Generally, solar incentives apply to:
- a new solar system
- installed on a property that you own
- within the U.S.
- within the date range specified by a particular incentive.
Specific incentives, including those run by the Pennsylvania government or by your county/municipality, could have additional qualifications. Talk to your local Allegheny solar installer to find out what incentives your project may qualify for.
What are the highest-rated solar panel installation companies near me?
To learn about the top solar panel installation companies near you, read our article on Allegheny's top solar panel companies.
How long until the federal solar tax credit ends?
The federal solar tax credit, previously called the ITC and now titled the Clean Energy Credit, is set to end January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
If I switch my appliances out for ones that can utilize solar energy, are there benefits that I can claim?
With the passage of the new Inflation Reduction Act, there are a variety of new financial incentives that are available when you make eco-friendly improvements to your home. More details regarding these incentives, including information about incentives for purchasing new appliances, can be found here.
Our goal is to reach as many people as we can with sensible solutions like solar energy. Our team of full-time local researchers collects solar price and installation data for every city in America then compiles it to create these digestible city guides. If you want to read our solar expert's opinion on the top solar companies featured here, follow this link.
Solar incentive research was conducted by Melissa Smith and Karsten Neumeister. Local data analysis was conducted by James Savino. See something we missed or could do better? Email the editor.