With federal solar tax credits expiring in 2026, and electric generation capacity issues in the PJM grid that need to be addressed as quickly as possible to meet the growing energy demand from A.I. data centers, solar projects in the queue can serve as a bridge to 2030 when PJM believes there will be a resource adequacy deficit.
Despite its rich energy history, Pennsylvania ranks near the bottom nationally in renewable energy growth. Expanding fiscally responsible in-state solar generation will help preserve the Commonwealth’s status as a net energy exporter.
Senate Bill 1019 promotes responsible solar development and siting across Pennsylvania while addressing growing concerns about how certain solar projects are influencing electricity markets and raising rates on electric bills for small business ratepayers.
Currently, projects commonly referred to as “merchant generators” are using net metering, a tool designed to financially reward consumers who generate a portion of their own electricity needs, to build oversized systems with no meaningful on-site energy use.
While these merchant generators provide much-needed electricity to the Pennsylvania grid, the electric distribution companies (EDCs) must purchase this electricity at prices that are often higher than what it would normally cost to buy power wholesale.
The Public Utility Commission has urged the General Assembly to act, citing net-metered projects that produce hundreds of times more electricity than they use and generate up to $500,000 per year per account.
Those added costs are then passed along to other customers within the small commercial utility customer class, leading to higher electric bills for small businesses that rely on standard default electric service.
According to the PUC’s 2023 AEPS Report, these projects have shifted over $100 million in costs onto other electric customers, with that number expected to grow significantly in future years.
The Commission warned lawmakers during a March 2025 public hearing that this trend will continue unless the law is updated to place reasonable limits on these practices.
At the same time, because of the favorable overall economics of these projects, the Public Utility Commission has seen a rapid increase in the number of interconnection applications for merchant generator projects.
Restoring Balance
Senate Bill 1019 will restore balance by closing this “merchant generator loophole,” while safe harboring projects already in operation or with an interconnection agreement (IA) that was executed with an EDC before September 1, 2025.
Moreover, projects with applications for an interconnection study submitted to an EDC before September 1, 2025 may also qualify for safe harboring; however, the legislation allows the PUC to establish, by order, a cap on the total megawatts of projects with an application, not to exceed a defined percentage of each EDC’s default service peak load.
This provision is intended to address any concerns over the number of projects in the queue to ensure that there won’t be a proliferation of safe harbored projects with applications submitted to an EDC.
Common Sense Siting
The legislation will also allow solar developers to continue to invest in Pennsylvania by removing market barriers like the arbitrary two-mile rule for virtual meter aggregation projects and incentivizing solar projects through 2050 to be sited on preferred sites like warehouses, brownfields, abandoned mine land, industrial land, school facilities
After 2050, the excess electricity these projects generate will be capped at their avoided cost, instead of full retail value.
Solar Industry Endorsement
In a December 17 letter endorsing Senate Bill 1019, the Solar Energy Industries Association said "promoting solar development complements, not replaces, Pennsylvania’s traditional energy resources."
"Expanding fiscally responsible in-state solar generation will help preserve the
Commonwealth’s status as a net energy exporter. SEIA envisions an energy future where solar and energy storage empower businesses and individuals to lower costs, strengthen reliability, and support a resilient energy grid.
“The Smart Solar Siting Act creates a clear path toward realizing this future.”
Click Here for a summary of the bill. Click Here for co-sponsor memo.
Also co-sponsoring the bill are Sen. Art Haywood (D-Montgomery), Sen. Scott Hutchinson (R-Venango), Sen. Marty Flynn (D-Lackawanna), Sen. Devlin Robinson (R-Allegheny), Sen. Nick Miller (D-Lehigh), Sen. Judith Schwank (D-Berks), , Sen. Nick Pisciottano (D-Allegheny) and Sen. Carolyn Comitta (D-Chester).
The bill was referred to the Senate Consumer Protection and Professional Licensure Committee for consideration.
Sen. Patrick Stefano (R-Fayette) serves as Majority Chair of the Consumer Protection Committee and can be contacted by calling 717-787-7175 or sending email to: pstefano@pasen.gov. Sen. Lisa Boscola (D-Lehigh) serves as Minority Chair and can be contacted by calling 717-787-4236 or sending email to: boscola@pasenate.com.
Resource Links:
-- PA Ranks 49th In US For Renewable Energy Growth; Delays In Adding Clean Energy To The Grid Will Cost Electric Ratepayers Billions [PaEN]
-- Evangelical Environmental Network Celebrates House Passage Of Community Solar Energy Legislation In PA, Urges PA Senate To Act
-- PA Capital-Star: Advocates See A ‘Missed Opportunity’ For Clean Energy In Pennsylvania [Community Solar]
-- In Case You Missed It: A.I./Data Center Articles - NewClips From Last Week - December 29 [PaEN]
[Posted: December 30, 2025] PA Environment Digest
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