2023 Solar Incentives Guide for Springfield, PA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Springfield.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2023 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Springfield?
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 make renewable energy usage more affordable via financial incentives for individuals who install solar panels on their homes. You may be eligible for different kinds of incentives, including cash back, discounts or credit towards your monthly utility bill, depending on your situation. Certain incentives come from your specific utility company, county or municipality, some from the state of Pennsylvania and others from the federal government. Some broad categories of solar incentives include:
- Net Metering: You may be able to sign a net metering contract with your Springfield utility company that will apply to all or a percentage of the excess electricity that is generated by your solar panels. They will then subtract this value from your monthly utility bill.
- Tax Exemptions: Your solar panels may 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 that solar panels add when you are calculating property taxes on your home.
- Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the federal government. (A tax credit is different from a tax deduction.)
- Rebates: Your solar installer might help you claim a rebate, or partial refund after purchase, for your solar system. Counties or states will also offer limited-time rebates at various times. The value of a rebate will usually come off the total price before any tax credits are calculated.
- Solar Renewable Energy Certificate (SREC): SRECs are credits that can be sold to your utility company (or other buyers) for money that typically becomes part of your taxable income. In most cases, a certain (small) threshold of energy production must be met before your solar system is eligible for SRECs or similar performance-based incentives. Incentives like these are generally handled by your state government.
Federal Solar Incentives
When thinking about solar incentives, you probably think of federal incentives first. The solar incentive that you may be most familiar with is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a certain percentage of the cost of your solar system.
The ITC applies towards solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, labor, equipment and accessories. This credit can be claimed on solar panels installed on a primary or secondary residence in the United States that you own. Originally, you could claim 30% of the total cost, although certain projects may qualify for only 26%, depending on the details. There is no maximum claim amount.
To better understand exactly how much the ITC could save you, speak with your local Springfield solar panel installer.
In August 2022, the ITC (now called the Clean Energy Credit) was expanded and extended by the passing of the Inflation Reduction Act. Under the new program, solar installation projects started after January 1, 2022 and completed by the end of 2032 may be eligible for a 30% tax credit. This percentage will then see a slight annual decrease until the end of the current Clean Energy Credit in 2035. Starting in 2023, the expansion to the program 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 Springfield solar panel installer can answer any questions you have and explain how the new Clean Energy Credit may apply to you.
State & Local Solar Incentives
Tax credits, rebates and more can be claimed at multiple levels. Along with federal solar incentives, there are often state and local ones, too. Some incentives are offered for only a limited time, while others are ongoing. Your local incentives might come from the Pennsylvania government, or from your specific county or municipality.
Next Steps for Installing Solar in Springfield
The variety of solar incentives available has helped tremendously increase the adoption of solar energy nationwide over the last 15 years. You may receive solar incentives from the Pennsylvania government, the federal government or your local utility company. If you're ready to switch over to solar energy, calling your local Springfield solar panel installation expert is an excellent place to start.
EcoWatch's Springfield, PA Solar Incentives FAQs
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