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

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

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

Solar incentives are designed to encourage homeowners to make the switch to renewable energy by providing financial incentives meant to lower the burden of solar panel installation and use. Incentives might include things like discounts, cash back or monthly utility bill credits. Some incentives are offered by the federal government, while others are provided by the Pennsylvania government or your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:

• Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce over a specific (usually small) amount of electricity qualify for SRECs or other similar performance-based incentives. SRECs and the like are typically provided at the state level. SRECs can be sold to your utility company or another buyer, and this is usually considered part of your taxable income.
• Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you've signed a net metering agreement with your Conewago utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some locations, this is a dollar-for-dollar credit, while in others you may make back a percentage of the value.
• Rebates: Solar rebates might be provided by your county or state, or by your local utility company. These rebates work as cash back that is applied after you pay for a solar system and before tax credits are calculated.
• Tax Credits: Tax credits decrease, dollar-for-dollar, how much income tax you owe the federal government. Tax credits are different from tax deductions.
• Tax Exemptions: These might come in the form of property tax exemptions, which 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.

Federal Solar Incentives

When people think of solar incentives, federal incentives might be the first thing that comes to mind. The Federal Solar Investment Tax Credit, or ITC, is probably the best-known federal solar incentive. The ITC allows you to claim a tax credit for a predetermined percentage of the cost of your solar system.

The ITC can be applied to solar systems installed after January 1, 2006 on a primary or secondary residence that you own in the United States. Initially, the credit applied to 30% of the total cost — for panels, labor, equipment and accessories — although it may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the amount you can claim.

Talking to your local Conewago solar panel installer is the best way to understand how the ITC may apply to your situation.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now referred to as the Clean Energy Credit. The new Clean Energy Credit extends until 2035. American homeowners can now apply for a 30% credit for solar systems that began installation after January 1, 2022 and are completed by the end of 2032. This new credit will then be decreased by a few percentage points every year until it expires. The expansion to the program also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.

Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit will apply to you, reach out to your local Conewago solar installation expert.

State & Local Solar Incentives

Some solar incentives are often also offered at the local or state level. Like with federal incentives, these can include tax credits, rebates and more. These solar incentives — which might be given by your county or municipality, or by the state of Pennsylvania — could be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Conewago

Nationwide solar energy use has significantly increased in the last 15 years, in part due 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 make the change to solar energy, reaching out to your local Conewago solar panel installation expert is a great first step.