Exploring the Exciting Landscape of Solar Incentives in the Year 2023
The federal government has enacted policy changes that enhance solar incentives for homeowners and businesses. Notably, the tax credit for solar installation has been boosted back up to 30%, a noticeable increase from the previous rate of 27%.
The solar renewable energy credits (SRECs) in Pennsylvania have seen a price elevation, growing from $40 to $45.50 each, with trends indicating a continued rise. This further accentuates the financial benefits of going solar for property owners in the state.
In a noteworthy addition to the solar incentives, the cost coverage for solar-plus-storage equipment has broadened its scope. Now, all devices with a power storage capacity of 3 kilowatt-hours (kWh) or more qualify under this provision. This effectively provides increased assistance for homeowners who are keen on incorporating a robust energy storage solution with their solar system.
Pennsylvania continues to lead the country with one of the strongest net energy metering policies. This is a critical aspect that rewards solar system owners by compensating them for the excess electricity they generate and feeds back into the local power grid.
Delving into the specifics of these solar incentive changes and their implications for residents in Central Pennsylvania, we find the following highlights:
The enhanced Federal Tax Credit, now back at 30%, is available for those installing a photovoltaic (PV) system between 2023 and 2032. The rate will then gradually reduce to 26% for systems installed in 2033, followed by a further drop to 22% for installations in 2034. This is exciting news for our clients who have just installed their solar systems this year and are gearing up for tax filing.
The scope of the Investment Tax Credit (ITC) for solar plus energy storage equipment expenses has been expanded. Now, the cost of energy storage devices with a capacity rating of 3 kWh or more is covered under this incentive.
As per the Office of Energy Efficiency and Renewable Energy, the enhanced ITC will effectively decrease the cost of rooftop solar installation by 30% for homeowners. This amounts to more than $7,500 in savings for an average-sized system. Furthermore, these beneficial tax credits are set to empower millions of American families to opt for solar installations on their rooftops. This move will unlock additional average savings of approximately $9,000 on electricity bills over the lifetime of the system.