2025 Solar Incentives Guide for Ephrata, PA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Ephrata.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Ephrata?
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
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are designed to encourage people to switch their home over to renewable energy by providing incentives that lower the financial burden of solar panel installation and use. Various kinds of incentives, like cash back, discounts or credit towards your monthly utility bill, might be available to you. Certain incentives may be handled by the Pennsylvania government, by your utility company or by county or municipality, while other incentives are federal. Some solar incentives you might qualify for are:
- Net Metering: You can sign a net metering contract with your Ephrata utility company. This agreement may apply to all or a percentage of the excess electricity your solar panels generate. Your utility company will then subtract this value from your monthly utility bill.
- Tax Credits: Tax credits lower, dollar-for-dollar, the amount of income tax you owe the federal government. Tax credits differ from tax deductions.
- Rebates: A solar rebate is a partial refund given after you've purchased your solar system. Rebates could 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.
- Tax Exemptions: Your solar system could qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to ignore the value added by your solar panels when you are calculating property taxes on your house.
- Solar Renewable Energy Certificate (SREC): SRECs and other similar performance-based incentives are typically handled by your state government. Once your solar panel system meets a certain threshold (normally a small amount of energy production), you can receive SRECs that can be sold to your utility company or other buyers. The money you receive is usually considered part of your taxable income.
Federal Solar Incentives
Federal solar incentives are likely to be the first thing that comes to mind when you think about solar incentives. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which gives you a credit on your taxes equal to a specified percentage of the cost of your solar system.
The ITC can be applied to solar systems installed after January 1, 2006, and allows you to deduct from your taxes a percentage of the total cost of solar panels, equipment, labor and accessories. You can receive this credit for solar panels installed on a primary or secondary residence in the United States that you own. 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.
Your local Ephrata solar panel installer can provide more information about the ITC and how it applies to your situation.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now dubbed the Clean Energy Credit. The Clean Energy Credit bolsters the current credit, increasing it up to 30% for solar installations undertaken between January 1, 2022, and December 31, 2032. After this, the percentage will decrease slightly each year until the program expires in 2035. Starting in 2023, the expansion to the program will also make it easier to get credit for energy storage systems.
More information about the new Inflation Reduction Act can be found here. Your local Ephrata solar panel installation expert is the best person to answer your questions regarding the new Clean Energy Credit and how it will apply to you.
State & Local Solar Incentives
Some solar incentives may be provided by state and local governments. As with federal incentives, these can include rebates, tax credits and more. Some incentives are offered for only a limited time, while others are ongoing. Your local solar incentives might come from the Pennsylvania government, or from your specific county or municipality.
Next Steps for Installing Solar in Ephrata
There are many kinds of solar incentives: those offered by local utility companies, those provided by the federal government and those offered by the Pennsylvania government, to name a few. The use of solar energy has grown enormously in the last 15 years, partially thanks to these incentives. Your local Ephrata solar panel installation expert can help you learn more about which incentives you should apply for, and get you on track to switch to renewable energy today.
EcoWatch's Ephrata, PA Solar Incentives FAQs
If I already have solar panels, can I still claim incentives?
Your best bet is to talk to someone from the company that installed your solar system – or reach out to a local Ephrata solar installer — to better understand which incentives you may qualify for. If your system was installed after January 1, 2022, you likely qualify for the recently increased 30% tax credit under the Inflation Reduction Act. Solar panels installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
Who installs solar panels near me?
To find a top-rated solar panel installer, check out our guide to the top solar companies in Ephrata.
How long until the federal solar tax credit ends?
The federal solar tax credit, formerly known as the ITC and now called the Clean Energy Credit, is slated 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 use multiple types of renewable energy to power my home?
You can use multiple types of renewable energy, or a combination of renewable and non-renewable energy, to power your home. Be sure to go over your plan with your local Ephrata solar installation expert. They can help you as you plan for your project and educate you on the various incentives that you might or might not qualify for.
Can I get any financial incentives when I add solar panels to a rental property, vacation home or commercial property?
While we recommend getting in touch with your local solar installer and/or tax professional to better understand what solar incentives apply to you, many incentives apply to a second home, provided that it is in the United States and owned by you. There may be additional incentives available specifically for commercial properties, depending on the details.
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.