2023 Solar Incentives Guide for Willow Street, PA - Tax Credits & Rebates
In this guide, we'll cover the latest solar incentives and rebates available in Willow Street.
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 Willow Street?
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 mitigate the cost of installing solar panels on your home. Financial incentives like these are designed to encourage more people to switch their home over to renewable energy. Incentives might include things like discounts, cash back or credit towards your monthly utility bill. Some incentives are handled federally, while others are provided by the state of Pennsylvania or by your specific utility company, county or municipality. Types of solar incentives might include:
- Tax Exemptions: Tax exemptions may come in one of two forms. First, there is sales tax exemption, applied when you purchase solar panels. The second is property tax exemption, which allows you to exclude the added value of your solar system when paying property tax on your home.
- Solar Renewable Energy Certificate (SREC): Generally, solar systems that produce more than a predetermined (generally small) amount of electricity will qualify for SRECs or similar performance-based incentives. SRECs and similar incentives are typically offered at the state level. SRECs can be sold to your utility company or another buyer, and this is usually considered part of your taxable income.
- Tax Credits: Tax credits are dollar-for-dollar reductions that lower the amount of income tax you owe the government. (This is different from a tax deduction.)
- Net Metering: Net metering factors in after your solar panels are up and running. If you have a net metering agreement in place with your Willow Street utility company, they will subtract the value of the excess energy your solar system produces from your utility bill each month. In some areas, this is a dollar-for-dollar credit, while in other areas you might receive a refund equivalent to a percentage of the value.
- 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. If you receive a rebate, that amount will usually come off your total price before 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 solar incentive that you're most likely to have heard of is the Federal Solar Investment Tax Credit (ITC), which provides a credit on your taxes equal to a percentage of your solar system's cost.
The ITC can be applied to solar systems installed after January 1, 2006 and lets you deduct from your taxes a percentage of the total cost of solar panels, equipment, labor 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.
Your local Willow Street solar panel installation expert can give you more information about the ITC and how it may apply to your situation.
The ITC was renewed and increased in scope after the passage of the Inflation Reduction Act in August 2022. It's also now called 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 this, the credit percentage will see a slight decrease annually until the program expires in 2035. The expansion also makes it easier to get credit for energy storage systems, beginning in 2023.
More information about the new Inflation Reduction Act can be found here. To best understand how the new Clean Energy Credit applies to you, speak with your local Willow Street solar installation expert.
State & Local Solar Incentives
Federal solar incentives are not your only option; rebates, tax credits and more are often offered at the local or state level. These incentives might be distributed by your county or municipality, or by the Pennsylvania government. Certain incentives are ongoing, while others are available for a limited time.
Next Steps for Installing Solar in Willow Street
Nationwide solar energy use has significantly increased in the last 15 years, in part thanks to the growth in the number of solar incentives. You can obtain these incentives from your local utility company, the Pennsylvania government or the federal government. Your local Willow Street solar panel installation company can give you more information about which incentives you can apply for, and get you feeling good about making the change to renewable energy today.
EcoWatch's Willow Street, PA Solar Incentives FAQs
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