2023 Solar Incentives Guide for South Hanover, PA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in South Hanover.
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 South Hanover?
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
First Energy (MetEdison, Penelec, Penn Power, West Penn Power) - Residential Solar Water Heating Program
FirstEnergy (MetEdison, Penelec, Penn Power, West Penn Power) - Residential Energy Efficiency Programs
Clothes Washer: $25- $50
Clothes Dryer: $50
Fridge/Freezer Recycling: $50
HVAC tune up: $50
Furnace Fan Motor: $150
Ductless Minisplit AC : $200
Central AC: $100 - $200
Air Source Heat pump: $250 - $500
Geothermal Heat Pump: $600
Packaged Terminal AC: $75
Packaged Terminal Heat Pump: $150
Programmable Thermostat: $25
Solar Water Heat: $500
Heat Pump Water Heater: $500
Home Energy Audit: $250
Lighting: Available as in-store discount in participating stores
Federal Residential Renewable Energy Tax Credit
Solar incentives are designed to mitigate the cost of installing solar panels on your home. These financial incentives are in place to encourage more Americans to make the switch to renewable energy. Solar incentives can include cash back, upfront discounts or monthly credits towards your utility bill. Some incentives are handled by the federal government, some by the Pennsylvania government and some by your specific utility company, county or municipality. Some broad categories of solar incentives include:
- Solar Renewable Energy Certificate (SREC): SRECs and similar performance-based incentives are generally handled by your state government. Once your solar system meets the qualification threshold (usually a small amount of energy production), you are eligible to receive SRECs that can be sold to your utility company or other buyers. The money you make is usually considered part of your taxable income.
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the government.
- Net Metering: Net metering is an incentive you can get after your solar panels are up and running. If you have in place a net metering agreement with your South Hanover utility company, the company will subtract the value of the excess energy your solar system produces from your utility bill each month. In some places, this is a dollar-for-dollar credit, while in others you might get refunded a percentage of the value.
- Rebates: Rebates, or cash back after a purchase, are usually given prior to any solar tax credits being calculated. Solar rebates may be offered by your local utility company, by your county or by your state.
- Tax Exemptions: These could come in the form of property tax exemptions, which can let you exclude the value of your solar system when paying taxes on your home. You may also qualify for an exemption on sales tax at the time of purchase.
Federal Solar Incentives
When people think of solar incentives, federal incentives are likely the first thing that comes to mind. You might have heard of the Federal Solar Investment Tax Credit, or ITC. This is a tax credit that reduces your taxes by a predetermined percentage of the money you spend on solar panels for your home.
The ITC initially applied to 30% of the cost of installing solar panels, and has fluctuated slightly over the last few 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, accessories and labor. There is no maximum amount you can claim. The ITC applies to solar panels installed after January 1, 2006 on your primary or secondary residence. The residence must be in the United States and owned by you.
Have questions about how the ITC applies to your specific situation? Contact your local South Hanover solar panel installer to get 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 bolsters the current credit, increasing it up to 30% for solar systems installed between 2022 and 2032. After 2032, the credit percentage will see a slight decrease annually until the end of the program 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. Your local South Hanover solar panel installation experts can answer your questions and explain how the new Clean Energy Credit may apply to you.
State & Local Solar Incentives
Tax credits, rebates and more can be provided at multiple levels. Along with federal solar incentives, there are often state and local ones as well. Some incentives are offered for only a limited time, while others are ongoing. Local solar incentives might come from your county or municipality, or from the Pennsylvania government.
Next Steps for Installing Solar in South Hanover
Solar incentives might come from the federal government, the Pennsylvania government or your local utility company. The growing number of solar incentives available has helped nationwide use of solar energy increase greatly in the last 15 years. Speaking with your local South Hanover solar panel installation expert is an excellent first step towards getting all the incentives you qualify for when you switch to solar energy.
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EcoWatch's South Hanover, PA Solar Incentives FAQs
How do I know if I qualify for specific solar incentives?
It's best to speak with your local South Hanover solar installer for a better understanding of which incentives your project may qualify for. Usually, solar incentives apply to new solar systems installed on property you own (in the U.S.) within a specified date range. Some incentives, like those provided at the level of the Pennsylvania government, might have other requirements.
If my house already has solar panels, can I still claim incentives?
If your solar system was installed after January 1, 2022, you may qualify for the recently increased 30% tax credit under the Inflation Reduction Act. If you installed your system 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 solar system, or any local South Hanover solar installer, can help you learn more about what incentives you qualify for.
I want to change out my appliances for ones that are more energy-efficient. Are there any incentives I can apply for?
Under the new Inflation Reduction Act, there are several new financial incentives that are available when you make eco-friendly improvements to your home. More details regarding these incentives, including information about incentives for purchasing new appliances, can be found here.
Can I qualify for incentives both towards the up-front cost of solar panels, and later as reimbursement?
The order in which incentives are applied might vary depending on which incentives you are claiming but typically yes, you can claim multiple types of incentives for your solar project. Check with your solar installer or a local tax professional to confirm you are claiming all possible incentives and applying them in the correct order.
Can I use a combination of solar and another type of renewable energy to power my home?
You can power your home with multiple types of renewable energy, or a combination of renewable and non-renewable energy. Make sure you talk through your plan with your local South Hanover solar installation expert. They can help you as you plan for your project and also help you understand the various incentives that you may or may 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.