SolarReviews | Pennsylvania Solar Power Rebates and Incentives

Rebates and other incentives for home solar power systems in Pennsylvania Renewable Portfolio Standard and AEC's (REC's and SREC's)

Pennsylvania has adopted renewable portfolio legislation that splits up the liability of generators to use renewable energy into a liability to use specific amounts of both Tier 1 and Tier 2 renewable energy sources. There is a small solar carve out as listed in the compliance table below.

Compliance Year (CY)

Tier I (including Solar PV)**

Tier II

Solar PV

CY 2007

1.5%

4.2%

0.0013%

CY 2008

1.5%

4.2%

0.0030%

CY 2009

2.0%

4.2%

0.0063%

CY 2010

2.5%

4.2%

0.0120%

CY 2011

3.0%

6.2%

0.0203%

CY 2012

3.5%

6.2%

0.0325%

CY 2013

4.0%

6.2%

0.0510%

CY 2014

4.5%

6.2%

0.0840%

CY 2015

5.0%

6.2%

0.1440%

CY 2016

5.5%

8.2%

0.2500%

CY 2017

6.0%

8.2%

0.2933%

CY 2018

6.5%

8.2%

0.3400%

CY 2019

7.0%

8.2%

0.3900%

CY 2020

7.5%

8.2%

0.4433%

CY 2021

8.0%

10.0%

0.5000%

Compliance is based on alternative energy credits (AECs). An AEC is equal to a megawatt-hour of qualified generation, and credits are the property of the generator unless expressly transferred. Banking of excess credits is allowed for up to two years, thus an AEC's useful life is three years. AECs are tracked by the PJM GATS system. The law establishes an alternative compliance payment (ACP) of $45 per megawatt-hour for shortfalls in Tier I and Tier II resources. A separate ACP for solar PV is calculated such that solar AEC's have a higher value than AEC's from other renewable energy sources. However, the solar carve out is quite small and as such the value of solar AEC's may not be substantially higher than other AEC's. It is definitely worth getting in touch with local suppliers by using our quote request form as their quotes will indicate the current value of SREC's Currently there is an oversupply of SREc's in the market and a House Bill is before the Pennsylvania legislature HB 1580 to increase the amount of SREC's required to be purchased by utilities in the coming years. However, even in this market SREC prices of $150-$200 have been paid. As an owner of a solar power system you get one SREC for each 1000 kwh of solar power you produce. One kilowatt of solar power installed in a good location in Pennsylvania produces about 1100 kwh per year and so you get about 1.1 SREC's per kilowatt of solar per year. It is best to get in touch with local installers to find out what they will quote you for your SREC's. you can do this here

Net Metering of solar power systems in Pennsylvania

Pennsylvania has a one for one net metering scheme and the beauty of this scheme is that participation in it does not mean that your Rec's, (or AEC's as they are called in Pennsylvania) are automatically transferred to the utilities as they are in many other states where there is a net metering scheme.

30% Federal tax Credit

New solar power systems in Pennsylvania are entitled to the federal government 30% tax credit until 2016

State and Utility based rebates

Although there is a state based up front rebate program that has been paying $.75 per watt for systems up to 10kw this program has now run out of funding and is taking applications on a wait list basis. It is best to get in touch with local installers to find out when any future state based up front incentives may become available. Here is how the investment case stacks up for purchasing a solar power system in Pennsylvania.

Size of System (kw)  

5

Space required (square feet)  

650

Price of system per watt  

$3.50

Price of power (marginal cost high usage kwh's) $ per kwh  

0.11

Average daily kwh produced per 1 kw of solar  

3.1

Total average daily production  

15.5

Total Price (before incentives)  

$17,500.00

Federal Tax Credit  

$5,250.00

State Tax Credit    
State Rebate  

$0

Actual out of pocket cost after incentives claimed  

$12,250.00

Annual Power production  

5657.5

Total Annual Energy savings based on net metering at 1:1  

622.325

Annual income from SREC's based on $200 per SREC  

1100

Total Annual Return  

1722.325

Annual Return on Investment  

14%

     
Payback Time assuming no increase in power prices   6.5 years

Well the news is all good if you are looking at installing solar power in Pennsylvania, check out those estimated pay back times, click "here" and get some quotes from local solar professionals.  


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