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

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

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

Solar incentives are meant to help mitigate the cost of installing solar panels on your home. Financial incentives like these are designed to encourage more people to switch their home over to renewable energy. Incentives could include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are offered by the federal government, while others are handled by the Pennsylvania government or by your specific utility company, county or municipality. You might qualify for any of the following types of solar incentives:

• Net Metering: You may be able to sign a net metering contract with your Lower Providence utility company, that 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.
• Tax Exemptions: Your solar panels could qualify for exemptions on both sales and property tax. Sales tax exemptions are effective at the time of purchase. Property tax exemptions let you exclude the value added by your solar panels when you are calculating property taxes on your house.
• Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce more than a predetermined (normally small) amount of electricity can qualify for SRECs or other performance-based incentives. SRECs and similar incentives are typically provided by your state government. SRECs can be sold to your utility company or another buyer, and generally the money you make is normally considered part of your taxable income.
• Tax Credits: Tax credits decrease, dollar-for-dollar, how much income tax you owe the federal government. Tax credits are different from tax deductions.
• Rebates: A solar rebate is a partial refund given after you've purchased your solar panels. Rebates could be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before tax credits are calculated.

Federal Solar Incentives

Federal incentives are the kind of incentives that you are most likely to have some familiarity with. It's likely that you've heard of the Federal Solar Investment Tax Credit, or ITC. The ITC is a tax credit that reduces your taxes by a predetermined percentage of the money you spend on your solar system.

The ITC applies 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 and that is located in the United States. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum claim amount.

To more fully understand how the ITC may apply to you, reach out to your local Lower Providence solar panel installer and request more information.

The Inflation Reduction Act, passed in August 2022, made some changes to the ITC (as well as renaming it to the Clean Energy Credit). The Clean Energy Credit has increased the current credit up to 30% for solar installation projects started after January 1, 2022, and completed by the end of 2032. At this point, the percentage will be reduced slightly each year until the end of the program in 2035. Starting in 2023, it will also be easier to qualify for 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 might apply to you, talk to your local Lower Providence solar installation company.

State & Local Solar Incentives

Some solar incentives may be provided by state and local governments. Like with federal incentives, these may include rebates, tax credits and more. The incentives — which may be given by your county or municipality, or by the state of Pennsylvania — might be offered on an ongoing basis, or for only a limited time.

Next Steps for Installing Solar in Lower Providence

The nationwide use of solar energy has gone up significantly in the last 15 years, in part due to the growth in the number of solar incentives. You might receive these incentives from your local utility company, the federal government or the Pennsylvania government. Call your local solar panel installer today to discover more about the various programs and to save as much money as possible on solar panels for your Lower Providence home.