Solar Energy Program (SEP)

The Solar Energy Program (SEP) is a financial assistance initiative administered by the Pennsylvania Department of Community and Economic Development (DCED) in collaboration with the Department of Environmental Protection (DEP), under the oversight of the Commonwealth Financing Authority (CFA). The program is designed to support the expansion of solar energy adoption and production across Pennsylvania. It provides funding to eligible entities through grants, loans, and loan guarantees, aiming to foster solar energy generation, distribution, and manufacturing capacity within the state. Both solar photovoltaic (PV) and solar thermal projects are eligible for support. The SEP operates on a rolling basis, opening when funding becomes available through repayments or unused allocations. The main objective of SEP is to stimulate solar energy production and use, and to enhance the solar industry by supporting the development, assembly, and manufacturing of solar-related equipment. Eligible activities include the design, construction, installation, or improvement of solar energy facilities or equipment manufacturing facilities. These may involve site preparation, land acquisition, construction of buildings for solar-related purposes, equipment purchases, and energy storage systems. Projects must have a minimum useful life of twenty-two years to qualify. Solar PV projects that receive grant funding must transfer ownership of their Solar Renewable Energy Credits (SRECs) to the CFA for the life of the system, and these credits will be sold to fund future projects. Funding is tiered based on project type. For solar equipment manufacturers, grants are available up to $5,000 per new job created within three years of loan approval, and loans are available up to $40,000 per new job. For solar generation or distribution projects, grants are capped at $1 million or $1.50 per watt, whichever is less, and loans are limited to $5 million or $3.00 per watt, also whichever is less. Loan guarantees are also available up to $5 million and may cover up to 75 percent of loan deficiencies in the event of default. There are specific matching fund requirements: at least a 1:1 match is required for grants, and at least a 1:3 match is needed for loans. A non-refundable $100 application fee is due at the time of submission, and approved loans also incur a 1% commitment fee. Eligible applicants include businesses (both for-profit and nonprofit), economic development organizations, and political subdivisions such as municipalities, counties, and school districts. Projects that begin before official funding approval are ineligible. All projects must be in compliance with local zoning and land use plans, and applicants must provide proof of local government notification. Additionally, solar equipment must be UL-listed and installed in accordance with Pennsylvania’s Uniform Construction Code. Projects are evaluated on several criteria including technical and financial feasibility, project readiness, environmental impact, and job creation potential. The SEP accepts applications through the DCED’s Single Application for Assistance portal. There is no fixed submission cycle, and applications are only accepted when funding is available. Interested parties should monitor the DCED website or join the program’s distribution list for updates. Evaluation of applications is carried out jointly by the DCED and DEP under CFA guidance. Once a project is approved, a commitment letter is issued outlining the funding terms. Projects must submit periodic documentation and comply with audit and reporting requirements. Construction projects must provide engineer-certified documentation to access disbursements, which are typically issued at intervals no shorter than 30 days. For more information or assistance, applicants can contact the CFA Programs Division at the DCED. The main point of contact is reachable at RA-DCEDSiteDvpt@pa.gov or by phone at 717-787-6245. All correspondence should be directed to the Commonwealth Keystone Building, 400 North Street, 4th Floor, Harrisburg, PA 17120-0225. The program was most recently updated in August 2023, and applicants should refer to the latest fact sheet and 2017 program guidelines for complete application requirements and supplemental information.

Projects must be cost-competitive and technically feasible; grant recipients must be prepared to transfer SRECs; do not start project work before approval.