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residential financial incentives

For a current list of all state and federal incentives, please visit the Database for State Incentives for Renewables and Efficiency.

STATE

Keystone Home Energy Loan Program (Keystone HELP)
Funded by the Pennsylvania Treasury Department and administered by AFC First, the Keystone Home Energy Loan Program (HELP) is a low-interest loan program for homeowners to make their homes more energy efficient. Many efficiency improvements are covered by the program, including improvements to heating and cooling systems, upgrades to windows, doors, insulation and siding and upgrades of lighting and ceiling fans. In addition, this loan covers the purchase and installation of solar, wind and geothermal systems.

Most loans have a 10-year repayment term with a 8.99% interest rate, but some low-income participants may qualify for a lower 6.99% interest rate. There is no pre-payment penalty, equity requirement or outside fees. The improvements must be completed by an AFC First or Fannie Mae-approved contractor.

Net Metering
In Pennsylvania, investor-owned utilities must offer net metering to residential customers that generate electricity with systems up to 50 kilowatts (kW) in capacity. Systems eligible for net metering include those that generate electricity using photovoltaics (PV), solar-thermal energy, and wind energy (in addition to other systems).

Net metering is achieved using a single, bi-directional meter that can measure and record the flow of electricity in both directions at the same rate. Any customer net excess generation (NEG) will be credited at the utility's retail rate and carried over to the customer's next bill during a 12-month period.

The PUC adopted net-metering rules and interconnection standards for net-metered systems and other forms of DG in 2006, pursuant to the Alternative Energy Portfolio Standards Act of 2004.


FEDERAL

Residential Solar Tax Credit
The Emergency Economic Stabilization Act of 2008 included an extension of the federal tax credits for renewable energy installations. Extended through 2016, residential solar electric (PV) will now have a 30% federal tax credit, removing the $2,000 current cap, for systems commissioned after December 31, 2008. Solar Hot Water installations remain at 30%, capped at $2,000. This legislation also included, for the first time, a tax credit for small wind investment capped at $4,000.

Note that the tax credit does not apply to solar water heating property for swimming pools or hot tubs.

The credit is calculated based on the individual’s expenditures excluding subsidized energy financing, which is defined as "financing provided under a Federal, State, or local program a principal purpose of which is to provide subsidized financing for projects designed to conserve or produce energy." Consumers who receive other incentives are advised to consult with a tax professional regarding how to calculate this federal tax credit.

If the federal tax credit exceeds tax liability, the excess amount may be carried forward to the succeeding taxable year. Expenditures include labor costs for the onsite preparation, assembly, or original installation of the system and for piping or wiring to interconnect the system to the dwelling.

To be eligible for the credit, a system must be "placed in service" or activated on or after January 1, 2006, and on or before December 31, 2008. Expenditures with respect to the equipment are treated as made when the installation is completed. If the installation is on a new home, the "placed in service" date is the date of occupancy by the homeowner.



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