Pennsylvania has no state solar income-tax credit and no statewide cash rebate for home solar. The only real state-level money comes from two things:
- The AEPS solar SREC market, where your panels earn a certificate for each 1,000 kWh you generate, sold through PJM-GATS.
- Mandatory net metering that credits your exported power on your bill for residential systems up to 50 kW.
The 30% federal homeowner credit ended December 31, 2025.
Pennsylvania is one of the fastest-growing solar markets in the Mid-Atlantic, and its incentives are widely misread. There is no Pennsylvania state solar tax credit and no statewide rebate, so the honest question is not “which credit do I claim” but “how do I turn my panels into ongoing value.” The answer is two levers: the AEPS solar renewable energy certificate market and full net-metering credit on your electric bill. This page walks the real Pennsylvania solar incentive stack for 2026, how to actually monetize an SREC, why the federal homeowner credit no longer applies, and how to tell if solar is worth it for your home.
Why Pennsylvania solar incentives work differently
The first thing to know is that Pennsylvania offers no state income-tax credit and no statewide cash rebate for residential solar. In states like New York or South Carolina, homeowners get a credit against their state income tax. Pennsylvania does not have that program, so if someone tells you there is a Pennsylvania state solar tax credit, they are mistaken (DSIRE Pennsylvania).
What Pennsylvania gives you instead is a performance market plus net metering. Under the state’s Alternative Energy Portfolio Standards, your system can earn a solar renewable energy certificate, or SREC, that you sell for cash, and your utility must credit the power you send back to the grid (Pennsylvania PUC, AEPS Act). Those two levers are ongoing, not a one-time credit, and unlike the federal homeowner credit they are still in place in 2026.
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What solar makes on a Pennsylvania roof
Solar pays in Pennsylvania because of the grid power it replaces. The average Pennsylvania residential electricity price is about 21.55 cents per kWh (EIA retail sales, residential Pennsylvania, as of May 2026), which is above the national average, so every kilowatt-hour your roof produces offsets a fairly expensive one you would otherwise buy.
Pennsylvania sun turns that rate into real production. According to MySolarFY’s own analysis (as of August 2026), a 6 kW rooftop system in Philadelphia is modeled to produce about 8,028 kWh a year (NREL PVWatts v8 run, NSRDB typical-year data). At the state average price, that output offsets roughly $1,730 of grid power a year, before any SREC income. Actual production depends on your roof’s pitch, orientation, and shading, so estimate your own roof with NREL’s free PVWatts calculator before you size a system.
Pennsylvania solar incentives at a glance
Pennsylvania has no state tax credit and no statewide cash rebate, so its value comes from the SREC market and net metering. Here is what each piece does in 2026 and the fine print worth knowing.
| Incentive | What it does | 2026 status | Source |
|---|---|---|---|
| AEPS solar SRECs | Earns one tradable certificate per 1,000 kWh (1 MWh) your system generates, which you sell for cash | Active market for Pennsylvania-sited systems; SRECs registered and tracked in PJM-GATS | PA PUC |
| Net metering | Credits the excess power you export to the grid on your electric bill | Required of investor-owned utilities for residential systems up to 50 kW (52 Pa. Code Chapter 75) | DSIRE Pennsylvania |
| State solar income-tax credit | A state income-tax credit | None; Pennsylvania has no residential solar income-tax credit | DSIRE Pennsylvania |
| Statewide cash rebate | An upfront state rebate on the system | None statewide; check your utility or local program for any limited offer | DSIRE Pennsylvania |
| Federal residential (Section 25D) | A 30% homeowner credit | Ended for expenditures made after December 31, 2025 | IRS |
The SREC market and net metering apply to Pennsylvania homeowners who own their system. They are not tied to the federal credit that ended after 2025, and they build value over time rather than at purchase. For how programs stack across states, see our solar incentives overview, and for the full local picture start at our Pennsylvania solar hub.
Heads up on the federal change: the 30% federal Residential Clean Energy Credit (Section 25D) ended for expenditures made after December 31, 2025, under the One Big Beautiful Bill Act (IRS, as of January 2026), so a Pennsylvania homeowner who buys solar with cash or a loan in 2026 cannot claim it. Confirm every figure against the linked source, and ask a tax professional about your own situation. MySolarFY does not provide tax advice. For what the change means, see our guide to the federal solar tax credit in 2026.
How the AEPS solar SREC market actually works
Pennsylvania’s Alternative Energy Portfolio Standards require utilities to source a share of their power from solar, and they meet it by buying SRECs. Your system earns one solar renewable energy certificate for every 1,000 kWh (one megawatt-hour) it produces, and utilities buy those certificates to hit their compliance target (Pennsylvania PUC, AEPS Act). That is the mechanism that turns your generation into a separate income stream on top of the power you use.
To earn SRECs, your system has to be certified and its output tracked. Pennsylvania-eligible systems register through the state’s AEPS program and their generation is metered into the PJM Generation Attribute Tracking System, or PJM-GATS, which issues and records the certificates (PJM-GATS). Most homeowners sell through an SREC aggregator or broker who handles the registration, tracking, and sale for a fee, rather than trading certificates themselves.
One rule shapes the Pennsylvania market: Act 40 of 2017. That law largely limited AEPS solar credits to systems located in Pennsylvania, with grandfathering for certain out-of-state facilities certified before the cutoff (Pennsylvania PUC, Act 40 implementation). By tightening demand to in-state supply, it is the reason Pennsylvania has its own SREC price rather than tracking a wider regional one.
What an SREC is worth changes constantly. Prices are set by the market and move with supply and demand, so there is no fixed figure to promise. As a rough sense of scale, a 6 kW system producing about 8,028 kWh a year (our Philadelphia estimate above) generates roughly eight SRECs annually, and your total SREC income is those certificates multiplied by whatever the market pays at the time. Check the current Pennsylvania SREC price with an aggregator before you count on any number.
Net metering in Pennsylvania
Pennsylvania requires its investor-owned utilities to offer net metering, so the power you export earns a credit on your bill. Under 52 Pa. Code Chapter 75, residential customer-generators with systems up to 50 kW can net their solar exports against the grid power they draw (DSIRE Pennsylvania). In practice, a sunny day when your panels overproduce banks a credit that offsets a cloudy evening when you pull from the grid.
The details, including how any leftover credit is reconciled each year, are set by your utility’s tariff. The big Pennsylvania electric distribution companies, including PECO, PPL, Duquesne Light, and the FirstEnergy utilities, each file their own net-metering terms, and rules can change, so verify the current terms with your utility before you size a system (Pennsylvania PUC). For the mechanics of how export credits work, see how net metering credits your solar exports, our Pennsylvania net metering guide, and utility-specific rules in our PECO solar guide.
| Utility | Type | Rough service area | Net metering (2026) |
|---|---|---|---|
| PECO | Investor-owned | Philadelphia and the surrounding counties | Net metering for residential systems up to 50 kW per 52 Pa. Code Ch. 75; verify current tariff terms |
| PPL Electric | Investor-owned | Central and northeastern Pennsylvania, including the Lehigh Valley | Net metering for residential systems up to 50 kW per 52 Pa. Code Ch. 75; verify current tariff terms |
| Duquesne Light | Investor-owned | Pittsburgh and Allegheny County | Net metering for residential systems up to 50 kW per 52 Pa. Code Ch. 75; verify current tariff terms |
| Municipal and co-op utilities | Municipal / cooperative | Boroughs and rural areas outside the IOUs | Set their own rules, which may differ; confirm directly with your utility |
Is solar worth it in Pennsylvania?
For many Pennsylvania homeowners, yes, because the fundamentals line up. Above-average electricity prices, a working SREC market, and required net metering combine into a solid case even without a state credit. The honest catch is that the federal homeowner credit is gone as of 2026, so a cash or loan purchase this year cannot claim it. Whether solar pays for your specific home comes down to your roof, your utility, and your usage. For a deeper look at the numbers, see whether solar panels are worth it and what a system runs on our Pennsylvania solar cost guide.
How you pay decides which benefits you keep. The 30% federal homeowner credit (Section 25D) ended for expenditures made after December 31, 2025, so it is not part of a 2026 purchase on any path. If you buy the system with cash or a loan, you own it and keep both the SRECs and the full net-metering credit directly. If you lease or sign a power-purchase agreement, a third party owns the panels, you typically pay little or nothing up front, and the company that owns the system claims any commercial credit (Section 48E) and often the SRECs too, not you. On any path, solar panels are not free and terms vary. MySolarFY matches you with licensed Pennsylvania installers so you can compare real local quotes side by side, with no obligation.
Frequently asked questions
What solar incentives does Pennsylvania offer in 2026? Pennsylvania has no state solar income-tax credit and no statewide cash rebate. Its real state-level incentives are the AEPS solar SREC market, where your system earns one tradable certificate per 1,000 kWh and sells it through PJM-GATS, and net metering, which credits your exported power on your bill for residential systems up to 50 kW under 52 Pa. Code Chapter 75. The 30% federal homeowner credit ended for expenditures made after December 31, 2025. Confirm current terms with each source before you sign.
Does Pennsylvania have a state solar tax credit? No. Pennsylvania does not offer a residential solar income-tax credit, and there is no statewide cash rebate for home solar. The state’s value comes instead from the AEPS solar SREC market and required net metering, both of which build value over time rather than at purchase. Anyone advertising a Pennsylvania state solar tax credit is mistaken.
How do I actually make money from Pennsylvania SRECs? Your system earns one solar renewable energy certificate for every 1,000 kWh it generates. To sell them, the system must be certified in Pennsylvania’s AEPS program and metered into PJM-GATS, which issues the certificates. Most homeowners use an SREC aggregator or broker to register, track, and sell for a fee. Prices are set by the market and change constantly, so check the current Pennsylvania SREC price before you rely on a figure.
Does Pennsylvania have net metering in 2026? Yes. Under 52 Pa. Code Chapter 75, Pennsylvania’s investor-owned utilities, including PECO, PPL, and Duquesne Light, must offer net metering to residential customer-generators with systems up to 50 kW, crediting the excess power you export on your bill. The exact terms, including annual reconciliation, are set by each utility’s tariff, and municipal and co-op utilities set their own rules, so verify current terms with your utility.
What happened to the federal solar tax credit in Pennsylvania? The 30% federal Residential Clean Energy Credit (Section 25D) ended for expenditures made after December 31, 2025, under the One Big Beautiful Bill Act, so a Pennsylvania homeowner who buys solar in 2026 with cash or a loan cannot claim it. A separate commercial credit (Section 48E) can apply to leased and PPA systems, but the business that owns the system claims it, not the homeowner. Pennsylvania’s SREC market and net metering were not affected.
Reviewed by the MySolarFY team. Figures were verified against the linked EIA, NREL, IRS, Pennsylvania PUC (AEPS), PJM-GATS, and DSIRE sources as of August 2026; Pennsylvania SREC prices, utility net-metering tariffs, and program terms change, so confirm current SREC pricing and net-metering terms with an SREC aggregator and your utility before you decide. MySolarFY does not provide tax or financial advice; consult a licensed professional about your own situation. See how we source our numbers in our data and methodology, and browse more states from our solar by state hub.
MySolarFY is a free service that matches homeowners with licensed solar installers. We are not an installer, financing company, or government program. “No up-front cost” refers to qualifying lease or PPA financing, where eligible homeowners may have no out-of-pocket cost at installation. Lease and PPA terms typically run 20 to 25 years, may include an annual price escalator, and total payments may exceed the cost of a cash purchase. Homeowners do not get the federal residential credit that ended after December 31, 2025; on a leased system the company that owns it claims any commercial credit and often the SRECs. Solar panels are not free and monthly payments apply. Eligibility, savings, incentives, and rates vary and are not guaranteed. See our full disclaimer.
