Solar in Pennsylvania

You are eligible for a federal tax credit in the amount of 30% of the total cost of your solar system investment. The average system in in the range of $15,000 on the low end, to up in the $40-60K range for what we would consider larger residential systems. This means that if you invest $30,000, for example, your net cost will really be $21,000 after the $9,000 tax credit is taken. 

In order to qualify to the federal tax credit, you need to be paying federal income taxes. They will pay you back up to the amount that you paid in that year. If you have a larger tax credit than your yearly federal tax amount, the remaining tax credit amount can be used the following year. The solar tax credit is able to roll over 5 consecutive years if the total cannot be used the first year. 

To incentive you to go solar, the utility companies in PA credit homeowners with solar at a 1 to 1 rate. This means that a solar system can eliminate the utility company's bill (other than a low monthly connection fee of around $10) WITHOUT the need for battery storage. With full 1:1 credits, the system banks power all throughout the middle of the day when the system is producing more than the house and then in the evening, you do draw power from the grid, but the credits you built up in the day simply cancel out the night time bill. Most states do not have a net metering policy that credits you at the same value as what you actually are paying. Net metering will go away as solar participation increases so lock yourself in before the credit value starts to drop. Batteries start at around $10,000 and so do not want until you inevitably need to add at least $10,000 in cost to your total.  

In order to incentivize more solar installations. The state offers credits called "SRECS" based on production of solar system. The idea is that large corporations need to fulfill a certain size carbon footprint. When large corporations cannot achieve the sustainability goal, they have to purchase SRECS to make up the difference. This is technically an open market based on supply and demand and the value of SRECS can change over time. 

PA calculates an SREC to be currently around $30-40 with the latest bid coming in around $33 at the time of writing this. One SREC is awarded for every 1000kWh of production. 

Let's say you build a system that will produce 10,000kWh a year. This means that you would be eligible for 10 SRECS a year and three years of production is used. In this example, if we say the SRECS awarded are worth $32 each, $32 x 30 = $960.

**Currently Paused due to COVID 19 budget cuts**

The rebate program is worth $.20/w for residential and $.10/w for commercial. This means that if you install a 10kW system, a $2000 rebate would be given. You can still apply and if the program restarts, applications will be processed.