Pennsylvania Solar Incentives: PA Sunshine Program, Rebates, Credits

Maybe from the government? And what else should you know as a new solar panel owner?

Pennsylvania may be among the top states when it comes to the production of fossil fuel generated energy, but it is still a perfect place for you to set up your panels.

This complete guide explores the relationship between Pennsylvania solar incentives and the cost of solar panels in Pennsylvania and how they can be used together to not only reduce your dependence on the energy grid, but also lower your energy costs both immediately and in the long term.

Solar Power in Pennsylvania

The grid has provided electricity to Pennsylvanians for the longest time, but there is a problem. The pressure to meet the ever-rising demands seems to take a toll on the system, and it is obvious by the power outages that have been a pain to over 7 million people in PA from the year 2008 all the way to 2017.³

That is why solar power in Pennsylvania is so important to you and the entire state.

Luckily enough, the solar market in the region is not doing badly. Did you know that the cost of solar panels in Pennsylvania dropped by 45% over the previous five years?

That has made it possible for more and more people to convert to solar, not just to reduce their energy bills but also to stop the over-reliance on grid electricity.

Renewable Energy Use in Pennsylvania

SEIA (Solar Energy Industries Association) currently ranks the state as number 24 when it comes to solar power installations. Not too bad, but still, there is a massive room for improvement.

The probable reason why it is not ranking as high as other states is the fact that it still has deep connections to fossil fuels.

Pennsylvania is in the top five of the highest producers of non-renewable energy, and that makes it kind of lag behind in its course to make more people embrace solar power. There is a very high supply of fossil-based fuels, and many residents rely so much on it.

The only silver lining is that there are state and government incentives that have been quite effective in spreading awareness of the presence of alternative power sources. What’s more, the government and other companies have created plenty of solar farms in Pennsylvania to increase the supply of this renewable energy to the people.

Take a look at the Elk Hill Solar project in Peters Township, one of the largest of its kind in the state. It was established in 2020, and its 17.5 MW capacity and ability to serve over 2,200 homes make it one of the largest installations.

The Whitetail Solar 1, 2, and 3, and the Prologis’ projects have also etched their place in the solar world of Pennsylvania.⁸

How Much Are Solar Panels in Pennsylvania: Cost of Solar Panels in Pennsylvania

Good news for you if you live in Pennsylvania. The cost of solar panels in Pennsylvania is roughly 10 times lower than that of other states.

If you were worried, wondering why are solar panels so expensive, that shouldn’t be your main concern when choosing to go solar. You don’t have to hold yourself back thinking that the upfront costs are too high for you.

Down to the numbers for you to get a clear picture of the cost of solar panels in Pennsylvania. The national average is around $2.66 for each and every watt, but only $2.55 in Pennsylvania, which changes the game a bit.

Why? Because now, this means that installing solar in your home in PA will only set you back about $21,675,⁵ that is if you go for a 7 kW solar system.

This basically means that it will cost you less to opt for a more simple system, which is what most homeowners go for anyway.

High cost should be the least of your problems if you are keen on making the switch.

Current PA Solar Farms

The system costs way more in other states and you should feel lucky that it is cheaper to go solar in Pennsylvania.

To make things even better for you, there are also state rebate programs that will be instrumental in lowering the cost by a large figure.

In addition to that, there are several factors that usually influence the cost of the panels, and you may actually end up spending way less than the state average.

Factors Affecting the Cost of Solar Panels in PA

The state paying an average of $21,675 doesn’t mean that you will also pay the same amount.

As a matter of fact, the installation can cost you anything between $10,710 to the state average or even higher, that is depending on the following factors.

#1 The Solar Equipment

The panels and other equipment that are necessary for the system do play the biggest role in determining how much you will end up spending on the entire project. You should know that panels don’t come cheap, because it is already pretty expensive to make them, and the higher the quality, the more expensive they are going to be.

Choosing quality above all else may cost you more, but what you get in return is an efficient and durable system that will serve you for quite a long time. Well, most Pennsylvanians go for the high-quality versions because it is not really a choice, considering the limited number of sunny days.

There are only 179 days in the year that are sunny, and this means that you will need very powerful equipment that will work optimally despite the weather issues.

#2 Your Energy Needs

Do you usually have a big number on your energy bill? Then brace yourself because this more than likely means that your installation will have a huge price tag as well.

Look at it this way, if you have high energy needs, only a massive system will be able to provide the amount of power that you need.

Obviously, the larger the system, the more expensive it is. This is minus the soft costs related to buying the system.⁹

You will pay less for a 5 kW setup and more for a 9 kW version, so, where do you fall? Your ideal system size will always influence your budget.

#3 The Solar Company You Hire

A solar panel installation is just like any other product offered by a company. It will be cheaper in one place and more expensive somewhere else, and your choice makes all the difference.

It is easy to find one company overcharging its services and another actually offering discounts, and the best way to tell the two apart is by obtaining their quotations.

#4 The Mode of Financing

Many don’t pay much attention to this, but it is a big deal for you, especially if you are a first-timer. Know that the cheapest way to go is to pay in cash, and in full for that matter.

You may argue that the upfront cost will be high, but think about how much money you will save instead of paying high-interest rates.

Solar loans may make installation cheaper upfront, but by compiling all the interests over the years, you will realize that you will actually be paying much more in the long run.

Solar Panel Cost Calculator Pennsylvania: How Does It Work?

You must have come across a solar panel cost calculator online.

You may wonder what it is all about and what it has to do with your decision to go solar.

These calculators are simply online tools that use some personal details about your home and your energy needs to determine how many panels you actually need and how much installing them is supposed to cost you.

They are quite handy tools that you can always use if you are undertaking this project for the first time to help you make a few projections. The software gives you exactly what you need, a rough estimate of how much you will need for the installation.

This is not to say that they are 100% accurate, only that they come pretty close to disclosing the information that you need. Remember that each calculator has a specific algorithm and will ask different questions to help with the calculation.

However, expect to disclose details like your energy bills and your location.

Pennsylvania Solar Incentives You Should Know

Pennsylvania may not exactly have a strong Renewable Portfolio Standard (RPS) yet, but it doesn’t take away from the fact that it is a great place for solar power. This is evident by the number of incentives that are available that make investing in panels all the more worth it.

These programs aim to reduce the cost of the project and have been successful over the years. Here are some options you can consider.

Federal Solar Tax Credit

You should know about this by now, whether you are a Pennsylvanian or not because the federal energy credits are the most famous solar incentive in the country.¹⁶ It is not just in Penns, but it is available in all the states, and for a while now, encouraging millions to convert to solar power.

What if you are coming across it for the first time? If so, you should know how it works and why it is probably the incentive you should focus a lot more on.

The federal government has been very kind and thoughtful in offering the tax credit to all citizens who are first-time solar panel installers. As long as you qualify, you are entitled to a 30% credit out of the money that you used to install your system.

Say you used $20,000 on the project; the government will return 30% of that, which is $6,000 to you in the form of reduction or elimination of the amount of taxes that you owe.¹ It is just like receiving the money back, only not as a cashback but as a pardon on your tax liability.

And if the money you owe is not enough, the remainder will simply carry forward to the next tax season.

But what if you don’t have a tax liability, how does the solar tax credit work if I don’t owe taxes, you may ask? To put it simply, the money has to come from your tax burden or the money that you owe the government, and as a result, if you don’t have a tax liability, you cannot be able to enjoy the incentive, much less even apply for it.

To take the ITC in Pennsylvania, complete IRS Form 5695 with your standard Form 1040.¹⁵

Solar Renewable Energy Credits (SRECs)

Another Penns solar incentive making waves in the region is the SREC, which has so far proven to be a cherished program for many first-timers. Penns is lucky to be one of the very few states that care about its residents enough to offer them compensation for converting to solar power.

Imagine actually getting paid just for completing a project.

So how exactly does it work? You receive one credit for each and every 1,000 kWh or 1 MW that your panels produce.

After receiving these credits, you are free to sell them in exchange for cash and at a pretty great rate at that, exciting, right? What do you get for each credit you sell?

The normal rate for each one on the SREC market now stands at $38.

If you look at the numbers, you are likely to end up with at least $380 every single year, and it can be more depending on your energy production. Make that 20 years, and you will find yourself saving more than $7,000 just out of selling these credits, or in other words, you are able to buy back at least a third of your total installation cost.

One thing to remember is that since it is like any other market, the money from the SREC is taxable. The good news is that the rate varies based on the area and the time, and there are chances of getting higher rates, earning you more per year.

And all you have to do is simple; it takes only a few minutes to apply at the Penns Public Utilities Commission’s website.^6,10

Net Metering

This one is another famous incentive that rewards you for generating solar power, only that this time, it involves linking to the grid.

You should know that you have two options, either connecting to the grid or being completely independent.

If you don’t want any link to the traditional grid, you will have to buy your own batteries and connect them to your panels; that way, you will always have a power supply, even at night or when there are issues with the weather.

Otherwise, if you don’t have a battery as a backup, you have no other option but to opt for net metering. It is actually a great deal because it provides you power when you need it, and you also get something in return.

You see the excess power from your panels; you can transfer them back to the grid and in exchange, your utility provider gives you credit that you can use to reduce or offset the cost of the power you have received.

It is a win-win for both parties really because you get electricity when you need it and at a low cost, while your utility company meets its goals for having a part of its power come from renewable sources. It is also great news that Pennsylvania mandates all investor-owned utility companies to offer net metering.

However, sadly, the PUC doesn’t mandate how much the credits should be, and there are chances that you will receive a low rate for your service.

Local Incentives

Apart from the Pennsylvania solar incentives coming from the state and federal government, there are also additional perks that come from the local companies, varying according to your location and utility provider.

For example, one of the most lucrative programs is the City of Philadelphia solar program.

You are in luck if you are a Philly resident because this is a rebate program available for you. In addition to the other above incentives, you are also able to access this cash-back program that offers you $0.20 for each and every watt that you install.

It is not only available for residential setups because commercial customers are also eligible for a solar rebate at $0.10 a watt.

Therefore, if you have an 8 kW system, you may end up with about $1,700 just for installing the panels. These local incentives keep coming up, and some may be offered in your location that you have not yet heard about.

To be sure, you can always contact the Database of State Incentives for Renewables and Efficiencies (DSIRE) because more programs may be available.

What You Should Know About the SREC Pennsylvania Solar Program?

The SRECs (solar renewable energy certificates) are only available in a few states all around the country, and Pennsylvania just happens to be one of them.

They are kind of special Alternative Energy Credits that are exclusively available to you as a Pennsylvanian, rewarding you handsomely for converting to solar power.

It is interesting how you can receive the credits, trade them in the SREC market,¹¹ and actually earn money from them.

Getting to the numbers part may help you understand more about how they work. Consider an average Pennsylvania home, using about 850 kWh of power in every single month, which means that you will be able to receive around 10 SRECs every year.⁴

These will earn you about $380 annually, that is if the credits retail at $38, although it usually ranges around $40 in Pennsylvania.

This has been a game changer in the Pennsylvanian solar market, and more and more homeowners are looking forward to applying for it. Applying for it will take you only a few minutes, and although the money is not instant, you can easily earn $7,000 all through the lifespan of your panels, and who wouldn’t want that?

The Federal Solar Tax Credit As One of the Best Pennsylvania Solar Incentives

It goes without saying that the Federal Solar Tax Credit is one of the best solar power incentives in Pennsylvania, if not the entire country. You can check; there is no other program that will willingly deduct 30% of your installation cost other than the ITC.

It has been present since 2005 and, thankfully, was extended until 2034.

It may seem like a long time until you realize that the rate is supposed to reduce to 26% in 2033, then to 22% in 2034, after which it will completely disappear. Therefore, this is the perfect time to start the project when the government is incentivizing it by that much.

Imagine saving almost a third of the installation cost.

You are also free to combine the ITC with other rebate programs to help maximize your savings. With only minimal effort on your part, acquiring it will be a breeze and all your efforts will be worth it.

Just make sure that you meet the eligibility criteria.

First, make sure that you are a taxpayer and currently owe the government some money. Also, remember that you can only apply for the incentive after completing the installation, not before, so you will have to find a way to fund it, either using cash upfront or a solar loan.

How Do Pennsylvania Solar Incentives Reduce the Cost of Solar Panels in Pennsylvania?

The Pennsylvania solar incentives have come at the right time, now that solar power is becoming more popular. First-timers tend to lament that the initial cost can be too high for them, but guess what, they don’t have to be, all thanks to the solar incentives and programs.

Using them in combination is even better because you will save a lot more money than what only one has to offer.

The Federal Solar Tax Credit is the go-to for most people and with good reason.¹² It saves you 30% of the money by deducting it from your tax burden, and you can use it to easily slash almost a third of the cost.

As for net metering, not only does it reduce or eliminate your utility bills, but it also reduces the payback period of your panels.

On to the SRECs, it is one of the few incentives that offer you cash back for generating solar power. When you sell the credits on the market, you are able to get your money back, and by the end of it all, you can easily claim back more than $5,000 for the whole time that you will be using your panels.

Therefore, it is plain to see that all Pennsylvania solar incentives have your interest at heart and have a unique way of helping you recover the money you invested.

Why Choose Solar Panels in PA?

Are you wondering why your neighbors are suddenly going solar? Yet you already know that it can be quite a huge investment.

Well, you should also know that they are worth every penny, and here’s why.

#1 Solar Reduces Your Energy Costs

Owning a solar inverter helps you convert the sun’s rays into power, the electricity that usually costs a lot of money in Pennsylvania. You will never have to worry about high energy bills ever again, and you can calculate how much you will be saving by opting for solar instead of grid electricity.

#2 It Helps You Gain Energy Independence

There’s nothing quite like being free of the grid. You will never have to worry about blackouts, especially if you have installed a battery.

This means that you will always have power, at night, on cloudy days, during storms, and virtually every other day.

#3 Solar Power Is Cleaner

Fossil fuels are slowly becoming a thing of the past as more and more people are turning to eco-friendlier alternatives. The carbon footprint solar panels is not nearly as high as the emissions caused by fossil fuels.²

Pennsylvania is known for its over reliance on these traditional power sources, but that is soon going to change all thanks to the increasing popularity of solar energy.

#4 Solar Panels Increase Your Home Value

You will be thrilled to find out that solar panels have an incredible way of making your home more valuable in the real estate market. Potential buyers are always on the lookout for energy-efficient homes, and yours will be a top choice.

How much does solar increase home value, you ask? The rate can go as high as 4.1% or even higher depending on whether you live in a high-cost area.

Before You Buy Solar Panels for Home in Pennsylvania

Excited about installing solar panels? It is an important investment that will not only establish your independence from the grid but it will ultimately change your lifestyle.

But before you make this huge investment, there are a few factors to consider first.¹³

Pennsylvania Peak Sunlight Hours

First things first, do you get direct sunlight? This is probably one of the very initial things to consider.

You should be able to tell whether your rooftop receives direct sunlight or is shaded by nearby buildings or trees. The panels function at their best when angled properly and when they are able to soak in as much sun as possible.

Therefore, you have to take into account whether there are any obstacles around, otherwise, you will fail to make the most of your panels. Another consideration to make is your roof type.

Did you know that panels can last on your roof for at least 20 years? And, for the entire time, they will rely on your roof’s strength to hold them up, meaning that you have to have sheets that are in great shape, otherwise, they will not be able to hold up the heavy panels.

Installers will always assess the roof’s condition before starting the project, and if in bad shape, you will have to think about solar panel roof replacement, meaning extra costs.

Tips for the Best Yet Cheapest Solar Installation: Solar Panels Cost Pennsylvania

The best and the cheapest usually don’t go together, but that is what most homeowners look for in a solar system. You would take any chance you get to save money, but at the same time, you wouldn’t want to compromise on the quality.

So what should you do to get the best panels without breaking the bank while at it?

Number one, solar incentives are your best friend. There is nothing as exciting as knowing that you can receive rebates just for converting to solar power.

Whichever solar incentive you go for, you are sure that you will be able to pocket some money and ease the burden of paying more than $20,000 for your panels.

Secondly, you will realize this later on but paying for the panels in cash is actually cheaper than using loans that come with interest rates and long repayment periods.

Lastly, if you are going for quality but at a lower cost, your best bet may be to sift out the most reputable brands that make the highest quality products and then obtain multiple quotations, this way, you will know which brands out of the best in the market have friendlier charges.

Are There Free Solar Panels in PA?

Pennsylvanians from low-income families that want access to solar power may find it challenging, especially since the upfront costs are usually quite high. They cannot afford it unless they get assistance of some sort, either as free solar panels or general financial assistance.

Unfortunately, there is no such program for free solar panels in Penns.

What the state has going on, unlike other worst states for solar energy that rank in the bottom, is the fact that there are plenty of solar incentives that will help you reduce the cost of solar panels in Penns. If you use multiple of them, you will get a step closer to installing solar power at very little cost.

How To Get Free Solar Panels Pennsylvania

Have you been frequently asking how to get solar panels for free in Pennsylvania? Unless you want to learn more about the USDA REAP grant for commercial buildings,¹⁴ there is, unfortunately, absolutely no other way for you to receive panels at zero cost if you are in a residential setting.

Only the REAP grant that targets businesses in the agricultural field offer grants.

Luckily, you are able to receive solar incentives from both the federal and the state governments to help significantly reduce the cost of solar panels. Alternatively, you can also make full use of the power purchasing agreements where companies agree to set up the panels for you with little or no money down.

However, these PPAs are not free services because, by the end of the day, you will have to pay a monthly fee to access the power.

There is more good news for Pennsylvanians; there is also the PA Sunshine program by the PUC which does a great job lending a hand to low-income households, helping them install solar in their businesses and homes.⁷

Pennsylvania community solar is also a genius way to access cheap solar even without owning panels, and at a very low rate, unlike the everyday utility bills.

Is Solar in Pennsylvania Worth It?

Now that you have learned everything that you need to know about solar power in Pennsylvania, only one question is left to answer, is solar worth it in PA?

Yes, it is; the only difference is that some homes will find it more beneficial than others.

Take, for instance, the houses with direct sunlight access and those that have extremely high energy bills.

You have hit the jackpot with solar power if you can say without a doubt that these two cases apply to you. Investing in solar, which can be a huge deal for you and your home, is more worth it when you are sure that you will make a lot of savings out of it.

It also helps to know that your location and your roof angle will guarantee proper sunlight exposure, allowing your panels to work at their most optimal level.

All in all, solar power is and will always be a great idea, especially now that there are Pennsylvania solar incentives that will help lower the cost. Putting your money in such a system will always be worth it, particularly in the long term when others are still grappling with the high energy rates.

Pennsylvania may be struggling with fewer sunny days and over-reliance on fossil fuels, but that doesn’t make it a bad place for solar power. You can easily tell that by how the Federal and State governments are keen on providing solar incentives to make the concept of converting to renewable energy more popular, and it has worked so far.

The market is now more attractive for investors and customers alike, and the numbers are only going to go up from now on.

Thankfully, there are several Pennsylvania solar incentives that will come to your aid if you are serious about solar power and want to reduce the cost of solar panels in Pennsylvania.

Frequently Asked Questions About Pennsylvania Solar Incentives