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
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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
The term "solar incentives" covers a wide range of financial incentives implemented to make installing and using solar panels more affordable. This is done to encourage people to switch to renewable energy. Various kinds of incentives, such as cash back, discounts or monthly utility bill credits, might be available to you. Certain incentives may be offered by the state of Pennsylvania, by your utility company or by county or municipality, while others are federal. Some solar incentives you might qualify for are:
- Net Metering: Be sure to talk to 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 your solar panels generate. You could receive either a dollar-for-dollar credit or a percentage of the value.
- Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for cash that normally counts as part of your taxable income. Generally, a certain (small) threshold of energy production must be met before your solar system can earn SRECs or similar performance-based incentives. SRECs and similar incentives are generally handled by your state government.
- Tax Exemptions: Tax exemptions can come in one of two forms. The first is sales tax exemption, which is applied when you purchase solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when calculating property tax for your home.
- Rebates: Rebates, or cash back after a purchase, are typically given prior to any solar tax credits being calculated. These rebates may be given by your local utility company, by your county or by your state.
- Tax Credits: Tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government. (A tax credit is different from a tax deduction.)
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have heard of. You've likely heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a specified percentage of the money you spend installing solar panels.
The ITC was originally for 30% of the cost of solar panel installation, although that number has fluctuated slightly over time between 26-30%. The installation date of your solar system will determine what percentage you qualify for. The total installation cost includes the panels themselves as well as the cost of accessories, labor and equipment. There is no maximum amount you can claim. The ITC can be applied to solar panels installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.
Your local Hatfield solar panel installation expert can give you more information about the ITC and how it might apply to your situation.
In August 2022, the Inflation Reduction Act laid out new provisions for the ITC, now called the Clean Energy Credit. Homeowners can now receive a credit of 30% of the total solar system installation costs for projects started after January 1, 2022 and completed before the end of 2032. The percentage will then begin to decrease on a yearly basis until the Clean Energy Credit expires in 2035. Beginning in 2023, it will also be easier to claim credits for energy storage systems under this new program.
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 installation company.
State & Local Solar Incentives
Some solar incentives are often also offered at the local or state level. Like with federal incentives, these may include tax credits, rebates and more. Certain incentives are ongoing, while others might only be available for a limited time. These incentives may be offered by the Pennsylvania government, or by your county or municipality.
Next Steps for Installing Solar in Hatfield
The variety of available solar incentives has enormously increased the adoption of solar energy nationwide over the last 15 years. You might qualify for solar incentives from the Pennsylvania government, the federal government or your local utility company. Your local Hatfield solar panel installation expert can give you more information about which incentives you can apply for, and get you started on the path to switching to renewable energy today.
EcoWatch's Hatfield, PA Solar Incentives FAQs
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