2023 Solar Incentives Guide for Phoenixville, PA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Phoenixville.
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 Phoenixville?
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. You may qualify for different types of incentives, such as discounts, cash back or credit towards your monthly utility bill, depending on your situation. Some incentives come from your specific utility company, county or municipality, some from the state of Pennsylvania and others from the federal government. Types of solar incentives might include:
- Tax Credits: Different from tax deductions, tax credits are dollar-for-dollar reductions in the amount of income tax that you owe the government.
- Net Metering: Be sure to speak to your Phoenixville utility company about signing a net metering agreement. This allows you to get a credit towards your monthly utility bill 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): In general, solar systems that produce over a threshold (generally small) amount of electricity qualify for SRECs or similar performance-based incentives. SRECs and similar incentives are typically provided at the state level. When you receive an SREC, you can sell it to your utility company or another buyer, and the money you receive is normally considered part of your taxable income.
- Tax Exemptions: Your solar panel 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 exclude the value that solar panels add when you are calculating property taxes on your house.
- Rebates: Some solar companies will help you claim a rebate, or partial refund of your purchase, for your solar system. Counties or states will also offer limited-time rebates at various times. If you receive a rebate, that amount will usually be deducted from your total price before any tax credits are calculated.
Federal Solar Incentives
Federal incentives are the type of incentives that you are most likely to have some knowledge of. The Federal Solar Investment Tax Credit, or ITC, is probably the best-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 initially applied to 30% of the total cost of installing a solar system, although it has fluctuated slightly over the years 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 equipment, labor and accessories. There is no maximum amount you can claim. The ITC can be applied to solar systems installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.
Your local Phoenixville solar panel installer can provide more information about the ITC and how it applies to your situation.
The ITC was both renewed and expanded by the passage of the Inflation Reduction Act in August 2022. It's also now called the Clean Energy Credit. The new Clean Energy Credit now runs until 2035. You are now eligible for a 30% credit for solar systems installed between January 1, 2022 and December 31, 2032. This new credit will then decrease annually until it expires. The expansion also makes claiming credit for energy storage systems easier than ever before, beginning in 2023.
More information about the new Inflation Reduction Act can be found here. Your local Phoenixville solar panel installer can answer your questions and explain how the new Clean Energy Credit applies to you.
State & Local Solar Incentives
Some solar incentives may be provided by state and local governments. Similar to federal incentives, these may include rebates, tax credits and more. Certain incentives are ongoing, while others are only available for a limited time. They may be offered by the Pennsylvania government, or by your county or municipality.
Next Steps for Installing Solar in Phoenixville
The expanding number of solar incentives available has contributed greatly to the increase in the nationwide adoption of solar energy over the last 15 years. You can get solar incentives from the Pennsylvania government, the federal government or your local utility company. Your local Phoenixville solar panel installation expert can help you learn more about which incentives you should apply for, and get you feeling good about making the change to renewable energy today.
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EcoWatch's Phoenixville, PA Solar Incentives FAQs
How do I learn if I qualify for different solar incentives?
Typically, solar incentives apply to:
- a new solar system
- installed on a property that you own
- within the U.S.
- between the dates specified by a particular incentive.
Specific incentives, including those run by the Pennsylvania government or by your county/municipality, might have additional qualifications. Get in touch with your local Phoenixville solar installer to find out what incentives your project may qualify for.
How much can I save on my electric bill annually if I add solar panels to my Phoenixville home?
Generally, Phoenixville homeowners who install solar panels save around $815.15 per year, or around $15,487.94 over 20 years after making the switch.
I want to switch my appliances out for ones that are more energy-efficient. Are there any incentives I can apply for?
The new Inflation Reduction Act provides multiple incentives meant to reward homeowners for making eco-friendly upgrades. Some of these incentives include tax credits and rebates for installing new electric appliances. You can find more details about these incentives here.
Can I receive incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order your incentives will be applied in may vary depending on which incentives you are eligible for but usually yes, you can claim multiple types of incentives for your solar project. Talk with your solar installer or a local tax professional to ensure you are claiming all the incentives you are eligible for and applying them in the correct order.
Can I use a combination of multiple types of renewable energy to power my home?
Yes, you can utilize multiple types of renewable energy to power your home — for example, a combination of solar and geothermal. You can also use both renewable energy sources and a non-renewable backup source of energy. Make sure that you discuss the details of your plan with your local Phoenixville solar installation expert, to make sure you know what you'll need and what incentives 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.