2023 Solar Incentives Guide for Codorus, PA - Tax Credits & Rebates

What Solar Tax Credits, Incentives, and Rebates are Available in Codorus?

Source: https://www.dsireusa.org/

Solar incentives are designed to make renewable energy usage more affordable through financial incentives for individuals who install solar panels on their homes. You might be eligible for different kinds of incentives, including cash back, discounts or monthly utility bill credits, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of Pennsylvania and others from the federal government. Some broad categories of solar incentives include:

• Solar Renewable Energy Certificate (SREC): Typically, solar systems that produce more than a specified (generally small) amount of electricity can qualify for SRECs or similar performance-based incentives. SRECs and similar incentives are typically provided by your state government. You can sell SRECs to your utility company or another buyer, and this is usually considered part of your taxable income.
• Tax Exemptions: Sales tax exemptions are effective at the point of sale for your solar panels. Property tax exemptions allow you to ignore the value that your solar panels add when you calculate the amount of property tax you need to pay.
• Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
• Net Metering: Net metering becomes relevant once your solar panels are up and running. If you have in place a net metering agreement with your Codorus utility company, the company will subtract the value of the excess energy produced by your solar system from your monthly utility bill. In some locations, this is a dollar-for-dollar credit, while in other areas you might receive a refund equivalent to a percentage of the value.
• Rebates: Some solar companies will help you claim a rebate, or partial refund after purchase, for your solar system. States or counties will also sometimes offer limited-time rebates. Any rebates you receive will usually come off the total price before tax credits are calculated.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some familiarity with. The solar incentive that you're most familiar with is probably the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a percentage of the cost of your solar system.

The ITC can be applied to solar systems installed after January 1, 2006 and lets you 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 in the United States that you own. Originally, you could claim 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum claim amount.

Your local Codorus solar panel installation expert can offer more information about the ITC and how it applies to your situation.

The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). For solar system installations that begin after January 1, 2022 and are completed by the end of 2032, homeowners can receive a credit for 30% of the total cost. This percentage will decrease annually after 2032 until the Clean Energy Credit ends in 2035. Starting in 2023, the expansion to the program will also make credits for energy storage systems even easier to claim.

Click here to learn more about the new Inflation Reduction Act. The best way to understand how the new Clean Energy Credit might apply to you is to get in touch with your local Codorus solar panel company.

State & Local Solar Incentives

In addition to federal solar incentives, there are often also state ones. Rebates, tax credits and more can be offered at a more local level. Certain incentives are ongoing, while others may only be available for a limited time. Solar incentives may be provided by the Pennsylvania government, or by your county or municipality.

Next Steps for Installing Solar in Codorus

Solar energy use nationwide has significantly increased in the past 15 years, in part thanks to the proliferation of solar incentives. You might receive these incentives from your local utility company, the federal government or the Pennsylvania government. Talking to your local Codorus solar panel installer is a great first step towards getting the most money possible when you switch to solar energy.