The Coal State has taken significant steps to shed its nickname and become a leading force in the transition of the USA to renewable energy sources. And solar energy forms a big part of this transition initiative.
Pennsylvania has set up grants, loan funds, and market incentives to motivate homeowners to adopt solar power to meet their energy needs. Here’s a quick overview of all the solar incentives that homeowners can avail:
- The Federal Solar Tax Credit
The federal solar tax credit, officially known as Investment Tax Credit (ITC), is a tax relief offered to solar customers on their annual income. Customers can save as much as 26% of the costs they incurred on their solar system installation when filing their taxes.
Remember that it’s a tax rebate and not an actual discount. So, your annual taxes must be significant enough to take full advantage of this incentive.
- Net Metering
The state of Pennsylvania has an outstanding net metering program in place for residential solar customers. While the net metering prices change from one utility company to another, the incentive rate is generally pretty good. PECO Energy currently offers the best net metering program in the state, but other utilities aren’t far behind.
- Solar Renewable Energy Certificates (SRECs)
The principle behind SRECs is quite similar to that of carbon credits. Based on the amount of solar energy you generate over the year, you earn SRECs. You earn 1 SREC credit for every 1 MW of power you generate.
To give you an idea of what this means for you, a 5kW solar system generates about 6MW of power annually. According to SRECTrade, the PA SRECs are trading for $40 in summer 2021. So, a 5kW solar panel system will fetch you another $240 of incentive annually. For the past few years, SRECs have sharply risen in prices. So, this may mean a growing source of cash inflow for solar customers.