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PA solar costs $2.95-$3.15/W in 2026. A typical 12.81 kW system runs $37.8K-$40.4K before 6% sales tax. The federal residential ITC is dead, but SRECs + 1:1 net metering still deliver ~13-year payback.
Cost per Watt
$2.95-$3.15
PA average
12.81 kW System
$38K-$40K
before tax
Federal ITC
$0
25D expired
Payback
~13 yrs
cash purchase
Section 25D expired December 31, 2025 under the OBBBA. Pennsylvania homeowners who purchase solar with cash or a loan receive $0 in federal tax credits. The 30% commercial ITC (Section 48/48E) is still available for third-party PPA/lease providers through July 4, 2026.
Full post-ITC analysis for PAAll prices include equipment and installation at PA average rates of $2.95-$3.15/W. PA charges 6% sales tax on solar equipment with no exemption, adding $2.3K+ to typical system cost. No federal tax credit is available for cash or loan purchases.
| System Size | Panels | Cost (before tax) | Cost (with 6% tax) | Federal ITC | Best For |
|---|---|---|---|---|---|
| 6 kW | 15-18 | $17.7K - $18.9K | $18.8K - $20.0K | $0 | Small home, low usage |
| 8 kW | 20-24 | $23.6K - $25.2K | $25.0K - $26.7K | $0 | Apartment or small home |
| 10 kW | 25-30 | $29.5K - $31.5K | $31.3K - $33.4K | $0 | Average PA home |
| 12 kW | 30-36 | $35.4K - $37.8K | $37.5K - $40.1K | $0 | Larger home, moderate usage |
| 15 kW | 38-45 | $44.3K - $47.3K | $46.9K - $50.1K | $0 | High usage, EV, or pool |
PA cost note: Pennsylvania is one of the few northeastern states that charges sales tax on solar equipment (6%) AND has no property tax exemption for solar installations. These add approximately $2.3K upfront and ~$450/year in ongoing property tax increases to your total cost.
Solar costs vary across PA due to differences in installer competition, roof types, permitting timelines, and regional irradiance. Eastern PA gets the best sun exposure while western PA and Erie see more cloud cover.
Cost/Watt
$2.80-$3.20
Avg System
11 kW
Total Cost
~$33K
Utility Rate
$0.21/kWh
Best irradiance in PA. Urban installs with some flat-roof premium. PECO territory — strongest net metering economics.
Cost/Watt
$2.75-$3.15
Avg System
12 kW
Total Cost
~$35K
Utility Rate
$0.20/kWh
Lower irradiance than eastern PA (3.5-4.0 PSH). Lower labor costs partially offset reduced production. Duquesne territory.
Cost/Watt
$2.75-$3.15
Avg System
13 kW
Total Cost
~$38K
Utility Rate
$0.21/kWh
PPL territory — net metering at risk from proposed tariff changes (~July 2026). Strong urgency to lock in current 1:1 rates.
Cost/Watt
$2.70-$3.10
Avg System
14 kW
Total Cost
~$41K
Utility Rate
$0.19/kWh
Large rural rooftops, lowest installation costs in PA metro areas. Met-Ed (FirstEnergy) territory.
Cost/Watt
$2.75-$3.15
Avg System
12 kW
Total Cost
~$35K
Utility Rate
$0.18/kWh
Lowest irradiance in PA (~3.5 PSH). Lowest electric rate. Worst solar economics in the state. Lake-effect cloud cover.
Cost/Watt
$2.75-$3.15
Avg System
13 kW
Total Cost
~$38K
Utility Rate
$0.21/kWh
State capital, PPL territory. Same net metering risk as Allentown. Central PA irradiance (4.0-4.5 PSH).
Cost/Watt
$2.70-$3.10
Avg System
13 kW
Total Cost
~$38K
Utility Rate
$0.19/kWh
Met-Ed (FirstEnergy) territory. Similar economics to Lancaster with slightly higher urban density.
Pennsylvania sits at $2.95-$3.15/W, which is mid-range nationally. Several PA-specific factors affect your final cost.
PA charges 6% sales tax on solar equipment and installation. No exemption exists. This adds approximately $2.3K to a typical system — a cost that NJ, MA, and RI all waive.
Solar increases your assessed property value in PA, adding roughly $450/year in property taxes. Neighboring states exempt solar from property assessment.
PA SRECs trade at $22-$35/SREC. A 12.81 kW system earns approximately $448/year — modest income that helps offset the lack of tax benefits.
PA's full retail rate net metering credits are valuable at $0.17-$0.21/kWh depending on utility. A 12.81 kW system offsets roughly $2,400/year in electricity costs.
PA is a competitive choice state — you can shop for electricity supply rates. A higher supply rate means net metering credits are worth more.
Third-party PPA/lease providers still claim the 30% Section 48 ITC, passing savings as 20-40% lower rates. More attractive in PA since cash buyers get $0 federal benefit.
The loss of the 30% residential ITC adds roughly $11,300 to the net cost of a typical PA system.
PA SRECs trade at $22-$35/SREC on PJM-GATS. Each SREC represents 1 MWh of solar production. SRECs have a 3-year useful life from vintage year.
| System Size | Annual kWh | Annual SRECs | Annual Income | 25-Year Income |
|---|---|---|---|---|
| 6 kW | 7,500 | 7.5 | $210/yr | $4,947 |
| 8 kW | 10,000 | 10 | $280/yr | $6,596 |
| 10 kW | 12,500 | 12.5 | $350/yr | $8,245 |
| 12 kW | 15,000 | 15 | $420/yr | $9,893 |
| 15 kW | 18,750 | 18.8 | $525/yr | $12,367 |
PRESS Legislation Could Boost SRECs
The pending PRESS Act would raise PA's solar carve-out from 0.5% to 5.5%, likely increasing SREC prices significantly. Monitor the PA legislature for updates.
With the residential ITC gone, how you pay for solar matters more than ever. PPA/lease is now more attractive in PA because the financing company still gets the 30% Section 48 credit.
| Option | Upfront Cost | Federal Credit | Ownership | SRECs | Best For |
|---|---|---|---|---|---|
| Cash Purchase | $35,000–$40,000 (12.8 kW system) | $0 | You own the system | You keep 100% of SREC income (~$250-385/yr) | Homeowners who can afford upfront cost and want maximum long-term savings |
| Solar Loan | $0 down (typically) | $0 | You own the system | You keep 100% of SREC income | Homeowners who want ownership benefits without large upfront payment |
| Solar PPA (Power Purchase Agreement) | $0 | 30% (Sec 48) | Third-party owns the system | Third-party keeps SRECs (benefit passed through as lower rate) | Most PA homeowners in 2026 — MORE attractive post-ITC because the financing company claims the 30% Section 48 ITC and passes savings as a lower rate |
| Solar Lease | $0 | 30% (Sec 48) | Third-party owns the system | Third-party keeps SRECs | Homeowners who want predictable monthly costs with no maintenance responsibility |
| PACE Financing | $0 | $0 | You own the system | You keep 100% of SREC income | Homeowners in participating PA municipalities who want ownership with no upfront cost |
Your utility determines your electric rate (and therefore net metering value). PA has 7 major electric distribution companies.
| Utility | Territory | Avg Rate | PTC Rate | Net Metering Threat |
|---|---|---|---|---|
| PECO Energy | Philadelphia and southeast PA (largest by residential customers) | $0.21/kWh | $0.110/kWh | Stable |
| PPL Electric Utilities | Lehigh Valley, Harrisburg, Scranton, northeastern/central PA | $0.21/kWh | $0.130/kWh | Proposed changes |
| Duquesne Light | Pittsburgh and Allegheny County | $0.20/kWh | $0.124/kWh | Stable |
| Met-Ed (FirstEnergy) | Reading, York, Lancaster, south-central PA | $0.19/kWh | $0.119/kWh | Stable |
| Penelec (FirstEnergy) | Erie, State College, northeastern PA | $0.18/kWh | $0.110/kWh | Stable |
| Penn Power (FirstEnergy) | New Castle area, northwest PA | $0.19/kWh | $0.119/kWh | Stable |
| West Penn Power (FirstEnergy) | Greensburg, Johnstown, southwest PA | $0.17/kWh | $0.103/kWh | Stable |
Estimate your costs, SREC income, net metering savings, and payback period based on your utility, system size, and financing choice.
Estimate your solar return on investment with SREC income, net metering credits, and PA-specific costs.
Federal Residential Solar Tax Credit (Section 25D) Expired
Homeowners who purchase solar with cash or a loan receive $0 in federal tax credits. Section 25D expired December 31, 2025.
Greater Philadelphia / Southeast PA
Electric Rate
$0.18/kWh
Net Metering
1:1 retail credit
SREC Value
~$28/SREC
Interconnection
4-8 weeks
~12 SRECs/yr at ~$28/SREC
Payback Period
12.7
years
25-Year Savings
$48,511
total
Monthly Benefit
$208
per month
Estimates based on average 2026 PA solar pricing at $3.00/W, SREC spot ~$28/SREC, 1:1 retail net metering, 6% PA sales tax (applies to solar), NO PA state rebate, NO property tax exemption. Section 25D residential ITC expired Dec 31, 2025 -- $0 federal tax credit for cash/loan purchases.
The average cost of solar panels in Pennsylvania is $2.95-$3.15 per watt in 2026. For a typical 12.81 kW system, that is $37,800-$40,350 before PA's 6% sales tax ($2,300 additional). There is no federal residential tax credit (Section 25D expired December 31, 2025), no state rebate, and no sales tax exemption. Your net out-of-pocket cost for a cash purchase is roughly $40,000-$42,800.
No. The Section 25D residential solar tax credit expired on December 31, 2025 under the OBBBA signed July 4, 2025. PA homeowners who purchase solar with cash or a loan receive $0 in federal tax credits. However, if you go with a solar PPA or lease, the third-party financing company can claim the 30% Section 48/48E commercial ITC and pass savings through as a lower rate.
Pennsylvania SRECs (Solar Renewable Energy Credits) trade at $22-$35 per SREC (1 SREC = 1 MWh). A typical 12.81 kW system in eastern PA produces about 16 MWh/year, earning roughly $350-560/year in SREC income. PA SREC values are the lowest in the region due to the weak 0.5% solar carve-out under the AEPS. The pending PRESS legislation could boost prices if the carve-out increases to 5.5%.
Pennsylvania offers 1:1 full retail rate net metering credits on a monthly basis. Excess generation rolls over month to month. At the annual 12-month true-up, any remaining excess is paid out at the Price-to-Compare (PTC) rate, which is the supply-only portion and much lower than retail. PPL customers should be aware of proposed tariff changes that could shift to hourly LMP-based credits around July 2026.
Without the federal tax credit, the typical payback period for a cash-purchased solar system in Pennsylvania is approximately 13 years. This is driven by net metering savings of roughly $2,400/year plus SREC income of $350-560/year. The 6% sales tax and lack of a property tax exemption make PA's payback longer than neighboring NJ, MA, or RI.
No. Pennsylvania does NOT have a property tax exemption for solar installations. Solar panels add to your assessed property value and increase your property tax bill by an estimated $450/year. This is a significant disadvantage compared to New Jersey, Massachusetts, Rhode Island, and New Hampshire, which all exempt solar from property taxes.
In 2026, a solar PPA or lease is more attractive in PA than before because the third-party system owner claims the 30% Section 48/48E commercial ITC (available for projects beginning construction before July 4, 2026) and passes the benefit through as a lower electricity rate. With cash/loan purchases yielding $0 in federal credits, PPA/lease now offers a more compelling value proposition for many PA homeowners.
Philadelphia and the southeastern PA region (PECO territory) have the best solar economics due to the highest irradiance in the state (4.5-4.9 peak sun hours) and a $0.21/kWh electric rate. Lancaster and Reading offer the lowest installation costs ($2.70-$3.10/W). Erie has the worst economics due to lake-effect cloud cover reducing production to about 1,000 kWh/kW/year.
A typical 12.81 kW cash-purchased system in eastern PA can save approximately $54K over 25 years (after system cost, sales tax, and increased property taxes). This includes net metering bill savings of roughly $2,400/year escalating with rate increases, plus SREC income of about $350-560/year. The savings improve if the PRESS legislation passes and boosts SREC values.
PPL Electric Utilities has proposed shifting from 1:1 retail rate net metering to hourly LMP-based credits around July 2026. If approved, this would dramatically reduce the value of net metering for PPL customers in the Lehigh Valley, Harrisburg, and Scranton areas. Systems installed before the change may be grandfathered under current 1:1 rates. PPL territory customers should consider installing solar before this deadline.
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