2023 Solar Incentives Guide for Bethlehem, PA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Bethlehem.
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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Updated March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Bethlehem?
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
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
Refrigerator: $75
Clothes Washer: $25- $50
Clothes Dryer: $50
Freezers: $25
Dehumidifiers: $25
Fridge/Freezer Recycling: $50
HVAC
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
Others
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
Source: https://www.dsireusa.org/
Solar incentives help mitigate the cost of installing solar panels on your home. Financial incentives like these are designed to encourage more people to switch to renewable energy. You might qualify for different kinds of incentives, such as discounts, cash back or credit towards your monthly utility bill, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the Pennsylvania government and others from the federal government. Categories of solar incentives include:
- Tax Credits: Tax credits lower, dollar-for-dollar, how much income tax you owe the federal government. Tax credits differ from tax deductions.
- Net Metering: You can sign a net metering agreement with your Bethlehem utility company, that may apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then deduct this value from your utility bill each month.
- Rebates: Solar companies may help you claim a rebate, or partial refund after purchase, for your solar panels. Counties or states will also sometimes offer limited-time rebates. If you receive a rebate, that amount will usually come off the total price before any tax credits are calculated.
- Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are normally handled by your state government. Once your solar panel system meets the qualification threshold (usually a small amount of energy production), you can receive SRECs that you can then sell to your utility company or other buyers. The money you make from the sale is usually considered part of your taxable income.
- Tax Exemptions: Your solar system might qualify for exemptions on both sales and property tax. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions allow you to ignore the value added by your solar panels when calculating property taxes on your home.
Federal Solar Incentives
When thinking about solar incentives, you probably think of federal incentives first. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a specified percentage of your solar system's cost.
The ITC can be applied to the total cost of solar system installation, including the panels themselves as well as labor, equipment and accessories. This credit can be claimed for panels installed after January 1, 2006 on a primary or secondary residence located in the United States that you own. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum claim amount.
To better understand exactly how much money the ITC could save you, get in touch with your local Bethlehem solar panel installer.
The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The new Clean Energy Credit is valid until 2035. You can now apply for a 30% credit for solar systems installed between January 1, 2022 and December 31, 2032. This new credit will then see a slight annual decrease until it expires. The program expansion also makes it easier to get credit for energy storage systems, beginning in 2023.
More information about the new Inflation Reduction Act can be found here. Your local Bethlehem solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it will apply to you.
State & Local Solar Incentives
In addition to those provided at the federal level, there are often also state solar incentives. Rebates, tax credits and more can be offered at a more local level. These incentives — which might be handled by your county or municipality, or by the state of Pennsylvania — may be offered for only a limited time, or on an ongoing basis.
Next Steps for Installing Solar in Bethlehem
The nationwide use of solar energy has significantly increased in the past 15 years, in part thanks to the growth in the number of solar incentives. You can obtain these incentives from your local utility company, the federal government or the Pennsylvania government. When you're prepared to switch over to solar energy, talking to your local Bethlehem solar panel installation expert is an excellent place to start.
Best Regional Coverage
Momentum Solar
- Great warranty coverage
- Representatives are experts on local policies
- Concierge service ensures steady communication
- Slightly limited service offerings
Best Technology
Tesla Energy
- Price-match guarantee
- Sleek, efficient, and durable solar panels
- Best solar battery on the market
- Some reported issues with customer service
- Customer service varies by local dealer
EcoWatch's Bethlehem, PA Solar Incentives FAQs
What if I am planning to add solar panels to a rental property, vacation home or commercial property? Can I still qualify for incentives?
Many solar incentives are intended to apply to a property located within the United States that you own; most secondary residences will fall into this category. There may be other solar incentives available for commercial properties, depending on the specifics. We recommend getting in touch with your local solar installer and/or tax professional to fully understand what incentives may apply to your specific situation.
How can I learn if I qualify for certain solar incentives?
Generally, solar incentives apply to:
- a new solar panel system
- installed on a property that you own
- within the U.S.
- within the date range specified by a particular incentive.
Specific incentives, including ones handled by the Pennsylvania government or by your county/municipality, may have additional qualifications. Talk to your local Bethlehem solar installer to discover what incentives your project may qualify for.
What are some of the environmental benefits of switching to solar?
Solar energy is renewable — by switching where you get your energy, you help reduce the strain on our planet's resources. Solar panels can also lower the CO2 emissions from your home by 250 pounds a year, or around 5,000 pounds in 20 years.
When does the federal solar tax credit end?
The federal solar tax credit, formerly known as the ITC and now called the Clean Energy Credit, is set to end on January 1, 2035. The current 30% credit will end in 2032, replaced by a 26% credit in 2033 and a 22% credit in 2034.
Can I claim incentives both towards the up-front cost of solar panels, and later as reimbursement?
Yes, you can claim both rebates and tax credits towards the cost of your solar panels. Depending on precisely which incentives you are claiming, they may apply in a different order. Be sure to talk to your solar installer or a local tax professional to confirm that you are claiming incentives correctly and that you're getting the most money you can.
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.