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

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

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

The term "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 the installation and use of solar panels more affordable. Various types of incentives, like cash back, discounts or credit towards your monthly utility bill, may be available to you. Some incentives may be handled by the Pennsylvania government, by your utility company or by county or municipality, while other incentives are federal. You might qualify for any of the following types of solar incentives:

• Net Metering: Net metering is an incentive you can get once your solar system is up and running. If you've signed a net metering agreement with your Upper Providence utility company, they will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some areas, this credit is dollar-for-dollar, while in others you might make back a percentage of the value.
• Tax Credits: Different from tax deductions, tax credits reduce, dollar-for-dollar, the amount of income tax that you owe the government.
• Rebates: Some solar companies will help you claim a rebate, or partial refund of your purchase, for your solar panels. States or counties will also offer limited-time rebates at various times. Any rebates you receive will usually come off the total price before tax credits are calculated.
• Tax Exemptions: These can come in the form of property tax exemptions, which allow you to exclude the value added by your solar panels when calculating the taxes you pay on your home. They may also include exemptions on sales tax at the time of purchase.
• Solar Renewable Energy Certificate (SREC): SRECs and other performance-based incentives are typically handled by your state government. Once your solar system meets a certain threshold (generally a small amount of energy production), you can receive SRECs that you can then sell to your utility company or other buyers. The money you make from the sale is usually considered part of your taxable income.

Federal Solar Incentives

Federal solar incentives are likely to be the first thing that comes to mind when you think about solar incentives. An incentive many people are probably familiar with is the Federal Solar Investment Tax Credit (ITC). This incentive is a tax credit for a specified percentage of the cost of your solar system.

The ITC originally covered 30% of the cost of installing a solar system, 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 accessories, labor and equipment. There is no maximum claim amount. The ITC can be applied 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.

Reaching out to your local Upper Providence solar panel installation expert is the best way to understand how the ITC may apply to your situation.

The Inflation Reduction Act, passed in August 2022, added more provisions to the ITC (as well as retitling it the Clean Energy Credit). Homeowners are now eligible for a credit equal to 30% of the total costs of solar system installation for projects started after January 1, 2022, and completed before the end of 2032. The percentage will then begin to decrease annually until the Clean Energy Credit expires in 2035. Starting in 2023, the program expansion will also make credits for energy storage systems even easier to claim.

Click here to learn more about the new Inflation Reduction Act. Your local Upper Providence solar panel installer can answer your questions and explain how the new Clean Energy Credit will apply to you.

State & Local Solar Incentives

Some solar incentives are often also provided at the state and local level. Similar to federal incentives, these can include tax credits, rebates and more. These incentives may be offered by your county or municipality, or by the Pennsylvania government. Some incentives may be ongoing, while others are available for a limited time.

Next Steps for Installing Solar in Upper Providence

You can receive solar incentives from the federal government and the Pennsylvania government, as well as from your local utility company. This increase in availability of solar initiatives in the past 15 years has helped increase nationwide solar energy use enormously. Getting in touch with your local Upper Providence solar panel installer is the best first step towards getting all the incentives you qualify for when you switch to solar energy.