2025 Solar Incentives Guide for Hampden, PA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Hampden.
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 Hampden?
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 mitigate the cost of installing solar panels on your home. This category of financial incentives is designed to encourage more Americans to switch their home over to renewable energy. Solar incentives might include upfront discounts, cash back or monthly credits towards your utility bill. Some incentives are offered by the federal government, some by the Pennsylvania government and some by your specific utility company, county or municipality. Some solar incentives you might qualify for are:
- Net Metering: Make sure you talk to your Hampden utility company about signing a net metering agreement. This allows you to get a credit towards your utility bill every month for the value of excess energy your solar panels generate. You may receive either a dollar-for-dollar credit or a percentage of the value.
- Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce more than a specified (usually small) amount of electricity qualify for SRECs or other 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.
- Rebates: Solar companies may help you claim a rebate, or partial refund of your purchase, for your solar panels. States or counties will also offer limited-time rebates at various times. If you receive a rebate, that amount will usually be deducted from the total price before tax credits are calculated.
- Tax Exemptions: Your solar panels may qualify for both sales tax and property tax exemptions. Sales tax exemptions are effective at the time of purchase. Property tax exemptions allow you to exclude the value that solar panels add when you are calculating property taxes on your house.
- Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the federal government.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some familiarity with. One of the incentives many people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a certain percentage of your solar system's cost.
The ITC applies to solar panels installed after January 1, 2006, on a primary or secondary residence that you own in the United States. The credit initially covered 30% of the total cost – for panels, equipment, labor and accessories – although the percentage may range from 26-30%, depending on when your solar project was undertaken. There is no cap on the claim amount.
Your local Hampden solar panel installation expert can provide you with more information about the ITC and how it may apply to your situation.
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. Solar installation projects started after January 1, 2022, and completed by the end of 2032 may qualify for a 30% tax credit; this amount will then decrease slightly each year until the end of the current program. Starting in 2023, it will also be easier to obtain credits for energy storage systems under this new program.
More information about the new Inflation Reduction Act can be found here. To best understand how the new Clean Energy Credit might apply to you, talk to your local Hampden solar installers.
State & Local Solar Incentives
Some solar incentives are often also provided at the state and local level. Like with federal incentives, these might include rebates, tax credits and more. Incentives might be given by your county or municipality, or by the state of Pennsylvania. Certain incentives might only be available for a limited time, while others are ongoing.
Next Steps for Installing Solar in Hampden
You can apply for and receive solar incentives from the Pennsylvania government and the federal government, as well as from your local utility company. Growing availability of solar initiatives over the last 15 years has helped increase nationwide solar energy use enormously. Your local Hampden solar panel installation expert can provide you with more details about which incentives you should apply for, and get you feeling good about making the change to renewable energy today.
EcoWatch's Hampden, PA Solar Incentives FAQs
My home already has solar panels. Are there any incentives that I qualify for?
If your solar panels were installed after January 1, 2022, you may qualify for the recently increased 30% tax credit under the Inflation Reduction Act. If you had your system installed between 2006 and 2021, you might qualify for a tax credit between 26% and 30%, depending on the year it was installed. Speaking with a representative from the company that installed your system, or any local Hampden solar installer, can help you learn what incentives you can apply for.
How much can I save annually on my electric bill if I add solar panels to my Hampden home?
When you add solar panels to your Hampden home, you can anticipate savings of about $729.78 per year, or approximately $13,865.87 over the next 20 years.
What are the environmental benefits of switching to solar energy?
Solar energy is renewable — by switching where you get your energy, you can help lessen the strain on our planet's resources. A solar system can also reduce the CO2 emissions from your home by 250 pounds annually, or roughly 5,000 pounds over 20 years.
How long until the federal solar tax credit ends?
The Clean Energy Credit (formerly named the federal solar tax credit, or ITC), is slated to end on January 1, 2035. Currently set at 30%, the credit will drop to 26% in 2033 and to 22% in 2034.
Can I claim incentives for adding 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 will apply to a second home, as long as it is in the United States and owned by you. There may be other incentives available specifically for commercial properties, depending on the specifics.
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