2024 Solar Incentives Guide for Lancaster, PA - Tax Credits & Rebates

In this guide, we'll cover the latest solar incentives and rebates available in Lancaster.

You'll learn about:

  • Local & State Solar Incentives
  • Federal Tax Credits (Updated for 2024 and beyond)
  • Ways to optimize your solar investment

Solar installers are experts in maximizing your solar tax credits and rebates.
Get a free quote from one of our trusted Lancaster solar installers to see how much you can save.

By EcoWatch Local Advisors

Data Analysis: James Savino

Ranking Methodology: Karsten Neumeister

Updated February 03, 2024

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We work with a panel of solar experts to create unbiased reviews that empower you to make the right choice for your home. No other site has covered renewables as long as us, which means we have more data and insider information than other sites. Our rankings are never affected by revenue or partnerships.

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

High Performance Buildings Incentive Program

Incentive Type:
Loan Program
Residential loans/loan guarantees: $100,000
Commercial loans/loan guarantees: $2 million
Grants: Lesser of 10% of project costs or $500,000

Wind and Geothermal Incentives Program

Incentive Type:
Loan Program
Manufacturer loans: $40,000 per job created within 3 years
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

Incentive Type:
Solar Renewable Energy Credit Program
Varies based on market conditions; during 2015 the market price for PA-sourced SRECs has ranged from approximately $32 - $55/MWh ($0.032 - $0.055/kWh) although individual trades have taken place at substantially lower and higher prices.
Learn more:

High Performance Building Incentives Program

Incentive Type:
Grant Program
Vary by project, but program generally requires matching funds at least equivalent to DCED funding

Federal Residential Renewable Energy Tax Credit

Incentive Type:
Personal Tax Credit
30% federal tax credit for systems placed in service after 12/31/2021 and before 01/01/2033. Good for: solar water heat, solar photovoltaics, biomass, geothermal heat pumps, wind (small), fuel cells using renewable fuels.

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 people to convert their home partially or fully to renewable energy. Incentives may include things like discounts, cash back or monthly utility bill credits. Some incentives are offered by the federal government, while others are handled by the state of Pennsylvania or by your specific utility company, county or municipality. Categories of solar incentives include:

  • Tax Credits: Unlike tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
  • Rebates: Solar rebates might be offered by your state or county, or by your local utility company. These rebates are essentially partial refunds that are applied after you pay for solar panels and before tax credits are calculated.
  • Tax Exemptions: Your solar system could qualify for exemptions on both sales and property tax. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions let you exclude the value that solar panels add when you are calculating property taxes on your house.
  • Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are normally handled by your state government. Once your solar system meets the qualification threshold (usually a small amount of energy production), you can receive SRECs that can be sold to your utility company or other buyers. The money you receive from the sale is usually considered part of your taxable income.
  • Net Metering: You may be able to sign a net metering contract with your Lancaster utility company. This agreement may apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then deduct this value from your utility bill each month.

Best National Provider

SunPower

★★★★★
5.0

  • Most efficient panels on the market
  • National coverage
  • Cradle to Cradle sustainability certification
  • Great warranty coverage
  • Expensive
  • Customer service varies by local dealer

Best Regional Coverage

Momentum Solar

★★★★★
4.5

  • Great warranty coverage
  • Representatives are experts on local policies
  • Concierge service ensures steady communication
  • Slightly limited service offerings

Best for Leasing

Sunrun

★★★★★
4.0

  • Expansive service area
  • Many financing options
  • Some reported issues with customer service
  • Some reported issues with door-to-door sales

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some knowledge of. An incentive that most people are likely to be familiar with is the Federal Solar Investment Tax Credit (ITC). This is a tax credit for a specific percentage of the cost of your solar system.

The ITC originally covered 30% of the total cost of solar system installation, although that number has fluctuated slightly over time between 26-30%. The percentage you qualify for will depend on when your solar system was installed. The total installation cost includes the panels themselves as well as the cost of accessories, equipment and labor. There is no maximum claim amount. The ITC applies to solar panels installed after January 1, 2006, on your primary or secondary residence. The residence must be owned by you and in the United States.

Your local Lancaster solar panel installer can provide more information about the ITC and how it might apply to your situation.

In August 2022, the Inflation Reduction Act made revisions to the ITC, now dubbed the Clean Energy Credit. Now, solar installation projects begun after January 1, 2022, and finished by December 31, 2032, may be eligible for a 30% tax credit. This credit amount will then see a slight annual decrease until the end of the current Clean Energy Credit in 2035. Starting in 2023, the expansion will also make claiming credit for energy storage systems easier than ever before.

Click here to learn more about the new Inflation Reduction Act. The best way to learn more about how the new Clean Energy Credit might apply to you is to talk with your local Lancaster solar panel installers.

State & Local Solar Incentives

Some solar incentives may be offered at the local or state level. Similar to federal incentives, these may include rebates, tax credits and more. The incentives — which may be given by the state of Pennsylvania, or by your county or municipality — could be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Lancaster

There are a variety of solar incentives: those offered by the federal government, those provided by the Pennsylvania government and those offered by local utility companies, to name a few. The use of solar energy has increased tremendously in the last 15 years, partially thanks to these incentives. Your local Lancaster solar panel installer can provide you with more details about which incentives you should apply for, and get you started on the path to switching to renewable energy today.

EcoWatch's Lancaster, PA Solar Incentives FAQs

How do I know if I qualify for certain solar incentives?

It's a smart idea to get in touch with your local Lancaster solar installer for a better understanding of which incentives your project may qualify for. Generally, solar incentives apply to new solar systems installed on property you own (in the U.S.) between the dates specified by the incentive. Some incentives, such as those offered by the government of Pennsylvania, may have other requirements.

I already have solar panels. Are there any incentives that I qualify for?

You should plan to talk to a representative from the company that installed your solar panels – or get in touch with a local Lancaster solar installer — to clarify which incentives you might qualify for. If your solar panels were installed after January 1, 2022, you likely qualify for the newly increased 30% tax credit under the Inflation Reduction Act. Solar systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.

How much will a solar system save me on my electric bill in Lancaster annually?

Typically, homeowners in Lancaster who install solar panels save about $739.82 per year, or around $14,056.59 over 20 years after making the switch.

How long until the federal solar tax credit ends?

The federal solar tax credit, formerly known as the ITC and now called the Clean Energy Credit, is slated 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.

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.

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