Solar Tax Credit and Benefits Did you know you can deduct 26% of the cost of installing solar with a Solar Tax Credit?
Learn 4 Of The Most Important PA Solar Power Benefits
There are plenty of solar power benefits and perks out there. More homeowners are realizing these benefits and learning how affordable installing a solar array for their residential house is. In this article, we are going to highlight some of those solar power benefits for you, starting with the ever-appealing solar tax credit.
Solar Power Benefit #1: Federal Solar Tax Credit (ITC)
One of the very best solar power benefits is the federal solar tax credit in PA. You may also have heard it termed the solar Investment Tax Credit (ITC), which is referring to the same program. What this means is that anyone choosing to go solar can utilize this Solar Federal Tax Credit to get a dollar-for-dollar credit on their taxes. The Solar Federal Tax Credit offers a dollar-for-dollar tax credit you can use for the year that your solar system is installed up to a certain percentage. Through the end of 2022, you can deduct 26% of the total cost of installing a new solar system from your federal taxes.
The exciting news is that in August of 2022, Congress extended the Solar Federal Tax Credit for 12 more years and increased the percentage from 26% to 30% through 2032! Beginning in 2023 and continuing on through 2032, you can get a 30% tax credit on an installed solar system. The tax credit now expires in 2035 and it changes from 30% back to 26% in 2033 and then drops again to 22% tax credit in 2034.
So what does this mean for you? If you are contemplating making the switch to solar, do it sooner rather than later if you want to enjoy this solar power benefit. For more details, visit this article How the New Solar Tax Credit in the Inflation Reduction Act Works or contact our knowledgeable team at Belmont. Additionally, you can also view the actual IRS form to see what the application for the solar tax credit looks like.
Solar Power Benefit #2: Net Metering with Solar
Another great solar power benefit is net metering. If you install a hybrid or grid-tied solar system in Pennsylvania, you can reap the benefits that net metering presents. Net Metering is a program supported by the State of Pennsylvania where any excess power your solar system produces, that you do not use, is sent back to the power grid for others to use immediately.
The amount of excess power that your system produces and sends back to the grid is recorded throughout the year and compared against the power you draw from the power grid during times of low solar production (nighttime or cloudy days). At the end of the year, if your surplus electricity is greater than the amount you used from the grid, you get a credit. That means you can reduce or even eliminate your entire electricity bill!
Solar Power Benefit #3: Reduced Energy Costs
A third solar power benefit is reduced energy costs. According to one study that was conducted recently, Pennsylvania has the 15 highest electricity prices in the nation. Now consider the fact that electricity costs are expected to continue rising over time! That’s a somewhat scary thought. The good news in light of this (no pun intended) is that going solar in Pennsylvania is really beneficial thanks to the PA Solar Tax Credit, Pennsylvania’s net metering program, and PA SRECs (more on PA SRECs in a moment).
By switching to solar energy, you can protect yourself against ever-increasing electricity prices and enjoy free, clean energy produced by the sun. More often than not, homeowners and businesses that choose to go solar can install a solar panel system large enough to eliminate their monthly electricity bills!
In addition, if you choose to add a battery backup to your solar system, you can have emergency power at your fingertips year-round and never worry about not having the emergency power you need to run your critical loads. Who wouldn’t want that for their business or home?
Solar Power Benefit #4: PA Solar Renewable Energy Credits (SRECs)
The last solar power benefit we need to touch on is solar renewable energy credits (SREC). The Commonwealth of Pennsylvania has set lofty goals for utility companies to produce or purchase electricity from renewable sources. To meet this goal, utility companies are willing to purchase credits from your solar system. Sometimes referred to as Solar Alternative Energy Credits (SAECs), a system receives one credit for each megawatt-hour (MWh) of energy produced.
PA SREC rates can fluctuate based on season, amount of credits available, and rates in other states. And while each credit is only worth $20-$40 in PA, these can add up to create additional incentives for switching to solar.
SRECTrade Image Credit
If you wish to learn more about SRECs, you should head over to SRECTrade and check out all the informative content they have on this topic. You can compare SREC rates in multiple states as well as see the Pennsylvania Solar Renewable Energy Credit price trends over multiple years. SREC Trade has great information if you want to learn more. You can also check out our blog explaining the 8 Things You Should Know About PA SRECs.
How Much Will Going Solar Cost You In PA?
By now, we hope that many of the benefits of going solar in Pennsylvania are clear! At Belmont Solar, we are passionate about helping people realize the serious benefits of going solar, both financially and environmentally. There is one big question that everyone wants an answer to in regards to going solar, how much will going solar actually cost?
It seems too good to be true, doesn’t it? A large federal tax credit, PA’s net metering program, and Solar Renewable Energy Credits that earn you money on top of producing your own power to free you from paying a monthly bill for electricity, there must be a catch, right?
There truly isn’t a catch! All these things can be a reality for you. The average payback time on a solar panel system, connected to the utility grid, that offsets or totally eliminates your monthly electricity bills is around 10 years! And a solar system like that will perform at 100% yield for at least 20 years and then even beyond that your solar panels will still generate lots of electricity.
If you want an accurate estimate of how much a solar panel system would cost you based on your monthly electricity bills check out our FREE solar panel cost calculator. All you have to do is select the amount you pay per month for electricity and the calculator will tell you the cost of a system that would eliminate that bill, how much you would save with the solar tax credit, how many SRECs that system would generate for you over the year, and how much adding solar battery backup would add to the cost of the grid-tied solar system.
Solar Power Benefits for You
Let us make this clear: these are solar power benefits that you and your family can also enjoy! These aren’t some lofty, unattainable ideals out there, but rather achievable incentives that come with switching to solar. Are you ready to make that switch? Just reach out to us to schedule a free consultation. Additionally, you can also head over to our solar installation page and begin exploring the different types of installations that we offer.
