2023 Solar Incentives Guide for Hatfield, PA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Hatfield.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
Solar installers are experts in maximizing your solar tax credits and rebates.
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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 Hatfield?
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
Solar incentives are intended to make renewable energy usage more affordable via financial incentives to help people install solar panels on their homes. Incentives could include things like discounts, cash back or credit on your utility bill each month. Some incentives are offered federally, while others are handled by the state of Pennsylvania or your specific utility company, county or municipality. Some broad categories of solar incentives include:
- Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce over a threshold (generally small) amount of electricity qualify for SRECs or other performance-based incentives. SRECs and similar incentives are typically given at the state level. When you receive an SREC, you can sell it to your utility company or another buyer, and this is usually considered part of your taxable income.
- Tax Exemptions: Sales tax exemptions are applied at the time of purchase for your solar panels. Property tax exemptions let you ignore the value added by your solar system when you calculate how much property tax you need to pay on your house.
- Net Metering: Make sure you speak with your Hatfield utility company about signing a net metering contract. This will allow you to get a credit towards your monthly utility bill for the value of excess energy generated by your solar panels. You could receive either a dollar-for-dollar credit or a percentage of the value.
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the federal government.
- Rebates: A rebate is a partial refund after the purchase of your solar panels. These might 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.
Federal Solar Incentives
Federal solar incentives are likely to be the first thing that you think of when thinking about solar incentives. The Federal Solar Investment Tax Credit, or ITC, is probably the most commonly known federal solar incentive. The ITC offers a tax credit for a specific percentage of the cost of your solar system.
The ITC can be applied to solar systems installed after January 1, 2006 and under this program you can deduct from your taxes a percentage of the total cost of solar panels, equipment, accessories and labor. You can claim this credit for a solar panel system installed on a primary or secondary residence that you own in the United States. 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 amount you can claim.
Talking to your local Hatfield solar panel installer is the best way to understand how the ITC applies to your situation.
The Inflation Reduction Act, passed in August 2022, expanded and extended the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit re-raises the credit up to 30% for solar installation projects started after January 1, 2022 and completed by the end of 2032. At this point, the credit percentage will see a slight decrease annually until the end of the program in 2035. Starting in 2023, it will also be easier to qualify for credits for energy storage systems with the new act.
More information about the new Inflation Reduction Act can be found here. To better understand how the new Clean Energy Credit might apply to you, reach out to your local Hatfield solar installers.
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. The incentives — which may 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 Hatfield
Solar energy use nationwide has increased enormously in the past 15 years, in part due to the increase in availability of solar incentives. You might receive these incentives from your local utility company, the federal government or the Pennsylvania government. Speaking with your local Hatfield solar panel installation company is an excellent first step towards getting all the incentives you qualify for when you switch to solar energy.
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EcoWatch's Hatfield, PA Solar Incentives FAQs
How can I find out if I qualify for different solar incentives?
Typically, solar incentives apply to:
- a new solar panel system
- installed on a property that you own
- within the U.S.
- within the date range specified by a particular incentive.
Specific incentives, including those run by the Pennsylvania government or by your county/municipality, may have additional qualifications. Speak with your local Hatfield solar installer to discover what incentives your project will qualify for.
If I installed solar panels on my house a few years ago, can I still claim incentives?
You should plan to talk to the company that installed your system — or get in touch with a local Hatfield solar installer — to learn about which incentives you might qualify for. If your system was installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
What are the best solar panel installation companies near me?
To find a top-rated solar panel installer, check out our guide to the top solar companies in Hatfield.
When does the federal solar tax credit end?
The federal solar tax credit, formerly known as the ITC and now titled the Clean Energy Credit, is set 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.
I want to switch my appliances out for ones that are more energy-efficient. Are there any incentives I can apply for?
Under the new Inflation Reduction Act, there are several new financial incentives that are available when you make eco-friendly improvements to your home. More details on these incentives, including information about incentives for purchasing new appliances, can be found here.
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.