2025 Solar Incentives Guide for Washington, PA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Washington.
You'll learn about:
- Local & State Solar Incentives
- Federal Tax Credits (Updated for 2024 and beyond)
- Ways to optimize your solar investment
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What Solar Tax Credits, Incentives, and Rebates are Available in Washington?
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
Refrigerator: $75
Clothes Washer: $25- $50
Clothes Dryer: $50
Freezers: $25
Dehumidifiers: $25
Fridge/Freezer Recycling: $50
HVAC
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
Others
Solar Water Heat: $500
Heat Pump Water Heater: $500
Home Energy Audit: $250
Lighting: Available as in-store discount in participating stores
Adams Electric Cooperative - Energy Efficiency Loan Program
Federal Residential Renewable Energy Tax Credit
Source: https://www.dsireusa.org/
Solar incentives are designed to make renewable energy usage more affordable through financial incentives for individuals who install solar panels on their homes. Incentives might include things like discounts, cash back or credit on your utility bill each month. Some incentives are provided by the federal government, while others are provided by the Pennsylvania government or by your utility company, county or municipality. Some solar incentives you might qualify for are:
- Tax Credits: Tax credits are dollar-for-dollar reductions (not deductions) in how much in taxes you owe the federal government.
- Rebates: A solar rebate is a partial refund after the purchase of your solar system. These could be offered by your local utility company, your state or your county. The discount that rebates offer is normally applied to the price of solar panels before calculating tax credits.
- Solar Renewable Energy Certificate (SREC): SRECs and similar other performance-based incentives may be available to you if the solar system on your home produces over a specified (generally small) amount of electricity. This category of incentives is typically handled by the state government. You can sell any SRECs you have to your utility company or other buyers, and the money you make is generally considered part of your taxable income.
- Net Metering: Net metering becomes relevant once your solar panels are up and running. If you've signed a net metering agreement with your Washington utility company, it will subtract the value of the excess energy produced by your solar system from your utility bill each month. In some places, this is a dollar-for-dollar credit, while in other areas you may receive a refund equivalent to a percentage of the value.
- Tax Exemptions: Tax exemptions may come in one of two forms. The first is sales tax exemption, which is applied at the time you purchase your solar panels. The second is property tax exemption. This allows you to exclude the value added by your solar system when calculating property tax for your home.
Federal Solar Incentives
Federal incentives are the kind of incentives that you are most likely to have some knowledge of. The Federal Solar Investment Tax Credit, or ITC, is the best-known federal solar incentive. The ITC allows you to claim a tax credit for a specific percentage of the cost of your solar system.
The ITC is applied to the total cost of installing solar panels, including the panels themselves as well as equipment, labor and accessories. This credit can be claimed for panels installed after January 1, 2006, on a primary or secondary residence that you own, as long as it is located in the United States. From its original value of 30% of the total cost, the credit has fluctuated slightly between 26-30%, and you may qualify for varying percentages depending on when your project was completed. There is no maximum amount you can claim.
To find out exactly how much the ITC could save you, contact your local Washington solar panel installation expert.
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 percentage will be reduced slightly each year until the program expires in 2035. Starting in 2023, the 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 Washington solar panel company is the best resource for answering your questions regarding the new Clean Energy Credit and how it will apply to you.
State & Local Solar Incentives
Some solar incentives are often also provided at the state and local level. Like with federal incentives, these can include rebates, tax credits and more. Some incentives are ongoing, while others are only available for a limited time. These incentives might be provided by your county or municipality, or by the Pennsylvania government.
Next Steps for Installing Solar in Washington
There are many kinds of solar incentives: those offered by local utility companies, those provided by the federal government and those offered by the Pennsylvania government, to name a few. The use of solar energy has grown enormously in the last 15 years, thanks to these incentives. Your local Washington solar panel installer can provide you with more details about which incentives you can apply for, and get you started on the path to switching to renewable energy today.
EcoWatch's Washington, PA Solar Incentives FAQs
How can I learn if I qualify for solar incentives?
Typically, solar incentives apply to:
- a new solar panel 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. Talk to your local Washington solar installer to find out what incentives your project will qualify for.
I already have solar panels. Does my system qualify for any incentives?
You should plan to talk to a representative from the company that installed your system – or speak to a local Washington solar installer — to clarify which incentives you may qualify for. If your system was installed after January 1, 2022, you likely qualify for the recently increased 30% tax credit under the Inflation Reduction Act. Systems installed between 2006 and 2021 may qualify for a tax credit of 26-30%.
I want to trade in my old appliances for ones that are more energy-efficient. Are there any incentives I can apply for?
The recently passed Inflation Reduction Act provides multiple incentives designed to reward homeowners for making eco-friendly upgrades. Some incentives include rebates and tax credits for installing new electric appliances. You can find more details about these incentives here.
Can I apply for incentives both towards the initial cost of solar panels, and later as reimbursement?
The order that incentives will be applied in may vary depending on which incentives you are eligible for but usually yes, you can receive multiple types of incentives for your solar project. Speak to your solar installer or a local tax professional to ensure you are claiming all the incentives you qualify for and applying them in the correct order.
What if I add solar panels to a vacation home, rental property or commercial property? Do I still qualify for incentives?
Many solar incentives are intended to apply to a property you own that is located within the United States, and most secondary residences will fall under this distinction. Other solar incentives may be available for commercial properties, depending on the specifics. We recommend speaking with your local solar installer and/or tax professional to best understand what incentives may apply to your specific situation.
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