2023 Solar Incentives Guide for Dallas, PA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Dallas.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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By EcoWatch Local Advisors
Data Analysis: James Savino
Ranking Methodology: Karsten Neumeister
Updated March 14, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Dallas?
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
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 that are in place to encourage the adoption and use renewable energy by making the installation and use of solar panels more affordable. These incentives could include upfront discounts, cash back or monthly credits towards your utility bill. Some incentives are handled by the federal government, some by the Pennsylvania government and some by your specific utility company, county or municipality. Types of solar incentives might include:
- Tax Credits: Unlike tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
- Net Metering: Make sure you talk to your Dallas utility company about signing a net metering agreement. This allows you to receive 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.
- Rebates: Rebates, or cash back after a purchase, are typically applied prior to any solar tax credits being calculated. Rebates might be offered by your local utility company, by your county or by your state.
- Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for money that typically becomes part of your taxable income. Generally, you must meet a certain (small) threshold of energy production before your solar system is eligible for SRECs or similar performance-based incentives. Incentives like these are normally handled at the state level.
- Tax Exemptions: Sales tax exemptions are effective at the time of purchase for your solar panels. Property tax exemptions allow you to exclude the added value of your solar system when you're calculating the amount of property tax you need to pay.
Federal Solar Incentives
Federal solar incentives are likely the first thing that you think of when you think about solar incentives. An incentive many people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). The ITC is a tax credit for a specified percentage of the cost of your solar system.
The ITC applies to solar panels 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, accessories, equipment and labor — 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.
To better understand how the ITC could apply to your situation, contact your local Dallas solar panel installer and request more information.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now referred to as the Clean Energy Credit. The Clean Energy Credit lasts until 2035. Your solar installation project undertaken between 2022 and 2032 may qualify for a 30% tax credit; the amount will decrease slightly each year until the end of the current program. The expansion also makes credits for energy storage systems even easier to claim, starting in 2023.
More information about the new Inflation Reduction Act can be found here. Your local Dallas solar panel installation expert is the best person to answer your questions regarding the new Clean Energy Credit and how it applies to you.
State & Local Solar Incentives
Some solar incentives may be provided at the state and local level. Similar to federal incentives, these could include rebates, tax credits and more. These incentives may be offered by your county or municipality, or by the Pennsylvania government. Certain incentives are available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Dallas
The variety of solar incentives available has contributed greatly to the increase in the use of solar power nationwide over the last 15 years. You may receive solar incentives from the federal government, the Pennsylvania government or from your local utility company. It is a good idea to talk to your local Dallas solar installer for more information about these incentives and to ensure that you're getting the most money possible for your solar system.
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EcoWatch's Dallas, PA Solar Incentives FAQs
Can I receive any incentives when I add solar panels to a rental property, vacation home or commercial property?
While we recommend speaking with your local solar installer and/or tax professional to better understand what solar incentives apply to you, many incentives will apply to a second home, so long as that home is in the United States and owned by you. There may be additional incentives available specifically for commercial properties, depending on the specifics.
What are the environmental benefits of switching to solar?
You can reduce your carbon footprint by 250 pounds of CO2 annually by switching to solar panels. This adds up to roughly 5,000 pounds in 20 years. In addition, solar power is a renewable energy source, which means that making the switch lessens the drain on our planet's resources.
When does the federal solar tax credit end?
The federal solar tax credit, formerly known as the ITC and now named 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.
Can I qualify for incentives both towards the initial cost of solar panels, and later as reimbursement?
Yes, you can receive both rebates and tax credits towards the cost of your solar panels. Depending on precisely which incentives you are receiving, they may apply in a different order. Be sure to speak with your solar installer or a local tax professional to verify that you are claiming incentives correctly and that you're getting the most money you can.
Can I use multiple types of renewable energy to power my home?
Yes, you can utilize multiple types of renewable energy to power your home, such as a combination of wind and solar. You can also use both renewable energy sources and a backup source of non-renewable energy. You should discuss your proposed plan with your local Dallas solar panel installer, to make sure you know what you'll need and what kinds of incentives you will or won't qualify for.
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.