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

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

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

The phrase "solar incentives" broadly refers to financial incentives implemented by the government and by solar companies to encourage the adoption and use renewable energy by making installing and using solar panels more affordable. Different types of incentives, including cash back, discounts or monthly utility bill credits, may be available to you. Certain incentives may be offered by the Pennsylvania government, by your utility company or by county or municipality, while other incentives are federal. Types of solar incentives might include:

• Rebates: A rebate is a partial refund after the purchase of your solar system. Rebates could be offered by your local utility company, your state or your county. The rebates are usually applied before calculating tax credits.
• Tax Credits: These credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the government.
• Net Metering: Be sure to talk with your New Kensington utility company about signing a net metering contract. This allows you to get a credit towards your utility bill every month 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 and similar performance-based incentives might be available to you if your solar system produces over a specified (generally small) amount of electricity. These types of incentives are typically handled by the state government. You can sell your SRECs to your utility company or other buyers, and the money you receive in return is usually considered part of your taxable income.
• Tax Exemptions: Your solar system could qualify for both sales tax and property tax exemptions. Sales tax exemptions come into effect at the time of purchase. Property tax exemptions let you ignore the value added by your solar panels when calculating property taxes on your home.

Federal Solar Incentives

When you think about solar incentives, you probably think of federal incentives first. The solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a predetermined percentage of your solar system's cost.

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

To more fully understand how the ITC might apply to your situation, contact your local New Kensington solar panel installer and request more information.

The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as retitling it the Clean Energy Credit). The Clean Energy Credit is valid until 2035. Any solar installation project that is completed between January 1, 2022, and December 31, 2032, may qualify for a 30% tax credit. This amount will be decreased slightly on a yearly basis until the end of the current program. Starting in 2023, the program expansion will also make credits for energy storage systems even easier to claim.

More information about the new Inflation Reduction Act can be found here. Your local New Kensington solar panel installer can answer your questions and explain how the new Clean Energy Credit applies to you.

State & Local Solar Incentives

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

Next Steps for Installing Solar in New Kensington

Solar incentives might be provided by the Pennsylvania government, the federal government or your local utility company. The variety of incentives available has contributed to a large increase in solar energy use in the last 15 years. Your local New Kensington solar panel installation company can give you more information about which incentives you might qualify for, and get you feeling good about making the change to renewable energy today.