2023 Solar Incentives Guide for Kennett, PA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Kennett.
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 May 04, 2023
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What Solar Tax Credits, Incentives, and Rebates are Available in Kennett?
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 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. Incentives may include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are handled federally, while others are provided by the state of Pennsylvania or your utility company, county or municipality. Categories of solar incentives include:
- Solar Renewable Energy Certificate (SREC): In most cases, solar systems that produce more than a specified (usually small) amount of electricity qualify for SRECs or other similar performance-based incentives. SRECs and the like are typically provided at the state level. You can sell SRECs to your utility company or another buyer, and generally the money you make is normally considered part of your taxable income.
- Net Metering: Net metering is an incentive you can get once your solar system is up and running. If you have in place a net metering agreement with your Kennett utility company, it will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some places, this is a dollar-for-dollar credit, while in other places you might get refunded a percentage of the value.
- Tax Credits: Tax credits decrease, dollar-for-dollar, the total amount of tax you owe the government. These are different from tax deductions.
- Tax Exemptions: Your solar panels may qualify for exemptions on both sales and property tax. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions allow you to ignore the value added by your solar panels when calculating property taxes on your home.
- Rebates: Rebates, or cash back after a purchase, are typically applied before any solar tax credits are calculated. Rebates may be given by your local utility company, by your county or by your state.
Federal Solar Incentives
When you think about solar incentives, you probably think of federal incentives first. The Federal Solar Investment Tax Credit, or ITC, is probably the most commonly known federal solar incentive. The ITC provides a tax credit for a set percentage of your solar system's cost.
The ITC covers 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 claim this credit for a solar panel system installed on a primary or secondary residence that you own in the United States. The original claim amount was 30% of the total cost, although depending on when the project was completed, your credit may range from 26-30%. There is no maximum claim amount.
To better understand exactly how much money the ITC could save you, contact your local Kennett solar panel installation expert.
In August 2022, the ITC (now titled the Clean Energy Credit) was bolstered by the passage of the Inflation Reduction Act. The new Clean Energy Credit is valid until 2035. You can now receive a 30% credit for solar systems installed between January 1, 2022 and December 31, 2032. The total credit will then be decreased by a few percentage points every year until the date of expiration. Starting 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 fully understand how the new Clean Energy Credit will apply to you, speak with your local Kennett solar installation company.
State & Local Solar Incentives
Some solar incentives are often also provided by state and local governments. As with federal incentives, these can include tax credits, rebates and more. Certain incentives are ongoing, while others are available for a limited time. They may be provided by your county or municipality, or by the Pennsylvania government.
Next Steps for Installing Solar in Kennett
The large number of available solar incentives has enormously increased the nationwide adoption of solar energy over the past 15 years. You may receive solar incentives from your local utility company, the federal government or the Pennsylvania government. When you're ready to make the change to solar energy, calling your local Kennett solar panel installation expert is a great first step.
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EcoWatch's Kennett, PA Solar Incentives FAQs
How do I know if I qualify for solar incentives?
Generally, solar incentives apply to:
- a new solar system
- installed on property that you own
- within the U.S.
- within the date range specified by a particular incentive.
Specific incentives, including ones handled by the Pennsylvania government or by your county/municipality, could have additional qualifications. Get in touch with your local Kennett solar installer to discover what incentives your project may qualify for.
If I already have a solar system installed on my house, can I still claim incentives?
If your solar panels were installed after January 1, 2022, you may qualify for the newly increased 30% tax credit under the Inflation Reduction Act. If you had your system installed between 2006 and 2021, you may qualify for a tax credit between 26% and 30%, depending on the year it was installed. Reaching out to the company that installed your system, or any local Kennett solar installer, can help you understand what incentives you qualify for.
What are the environmental benefits of switching to solar?
Solar energy is renewable — by switching where you get your energy, you can help lessen the strain on our planet's resources. You can also lower the CO2 emissions from your home by 300 pounds annually, or around 5,000 pounds in 20 years.
Can I claim incentives both towards the initial cost of solar panels, and later as reimbursement?
The order your incentives will be applied in might vary depending on which incentives you are eligible for but in most cases yes, you can claim multiple types of incentives for your solar project. Speak to your solar installer or a local tax professional to be sure you are claiming all of the incentives you qualify for and applying them in the correct order.
Can I use solar and another type of renewable energy in combination 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 ideas with your local Kennett solar installation expert. They can help you with the plan for your project and give you an understanding of various incentives that you might or might not qualify for.
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.