2025 Solar Incentives Guide for Hempfield, PA - Tax Credits & Rebates

What Solar Tax Credits, Incentives, and Rebates are Available in Hempfield?

Source: https://www.dsireusa.org/

Solar incentives are meant to encourage homeowners to make the switch to renewable energy by providing financial incentives meant to lower the burden of solar panel installation and use. Solar incentives could include upfront discounts, cash back or credit towards your monthly utility bill. Some incentives are handled by the federal government, some by the state of Pennsylvania and some by your utility company, county or municipality. You might qualify for any of the following types of solar incentives:

• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in the amount of tax that you owe the government.
• Net Metering: You can sign a net metering agreement with your Hempfield utility company, that may apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then subtract this value from your monthly utility bill.
• Tax Exemptions: These may come in the form of property tax exemptions, which can let you exclude the value of your solar system when paying property tax on your house. They may also include exemptions on sales tax at the time of purchase.
• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives may be available to you if you have a solar system that produces more than a specified (typically small) amount of electricity. These types of incentives are usually handled at the state level. You can sell the SRECs you receive to your utility company or other buyers, and the money you make is normally considered part of your taxable income.
• Rebates: A solar rebate is a partial refund credited to your account after you've paid for your solar system. These could be offered by your local utility company, your county or your state. The cash back that you get from the rebates is normally applied before calculating tax credits.

Federal Solar Incentives

Federal incentives are the type of incentives that you are most likely to have some familiarity with. The Federal Solar Investment Tax Credit, or ITC, is the most well-known federal solar incentive. The ITC allows you to claim a tax credit for a predetermined percentage of the cost of your solar system.

The ITC can be applied to the total cost of solar panel installation, including the panels themselves as well as equipment, labor and accessories. You can claim this credit for panels installed after January 1, 2006, on a primary or secondary residence that you own, as long as it is located in the United States. Originally set at 30% of total costs, the credit has fluctuated over time, and you may qualify for different amounts depending on when your project was completed. There is no maximum amount you can claim.

To better understand how the ITC might apply to your situation, get in touch with your local Hempfield solar panel installation expert and ask for more information.

In August 2022, the ITC (now titled the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. The new Clean Energy Credit extends until 2035. American homeowners can now apply for a 30% credit for solar systems that began installation on or after January 1, 2022, and will be done by December 31, 2032. The credit will then see a slight annual decrease until the date of expiration. The expansion also makes it easier to get credit for energy storage systems, beginning in 2023.

Click here to learn more about the new Inflation Reduction Act. To understand how the new Clean Energy Credit applies to you, speak with your local Hempfield solar installation company.

State & Local Solar Incentives

In addition to those provided at the federal level, there are often also state solar incentives. Tax credits, rebates and more may be available at a more local level. These incentives — which may be provided by the state of Pennsylvania, or by your county or municipality — might be offered for only a limited time, or on an ongoing basis.

Next Steps for Installing Solar in Hempfield

There are many types of solar incentives: those provided by local utility companies, those provided by the Pennsylvania government and those provided by the federal government, to name a few. Solar energy use has grown tremendously in the last 15 years, partially thanks to these incentives. Reaching out to your local Hempfield solar panel installation company is the best first step towards getting the most money possible when you switch to solar energy.