Pennsylvania Enacts Its First Solar Decommissioning Law

Written by Andrew Miller

On July 20, 2026, Governor Josh Shapiro signed Senate Bill 349 into law as Act 44 of 2026, establishing Pennsylvania’s first statewide framework for the decommissioning of ground-mounted solar energy facilities. The new law adds Chapter 43 to Title 27 (Environmental Resources) of the Pennsylvania Consolidated Statutes and is designed to ensure that solar developers, not the landowners who host their projects, bear the responsibility and cost of removing solar installations at the end of their useful life.

For our solar developer and municipal clients, the Act introduces important new obligations and, just as importantly, a set of exemptions that determine whether a given project is covered at all. Importantly, the Act will bring some uniformity to the current “wild west” of decommissioning plans and financial security through a statewide form of decommissioning plan.  The legislation also significantly relaxes the decommissioning requirements most developers have become accustomed to under local ordinances.  Under Act 44 of 2026, the financial security requirements are phased-in over time and far more lenient than most solar ordinances we have encountered.  There are also some nuances and planning opportunities under Act 44 of 2026 for solar developers.  Below is a practical overview of what the law does, when it takes effect, and how it treats existing leases, options, municipal ordinances, and the critical distinction between smaller “behind-the-meter” net-metered projects and larger “front-of-the-meter” utility-scale facilities.

1.  Passage of the Legislation

Senate Bill 349 was sponsored by Senator Gene Yaw (R-23) and enjoyed strong bipartisan support, clearing the Senate 49–1 and the House 196–6 before being signed into law on July 20, 2026 as Act 44 of 2026. The measure was backed by the Pennsylvania Farm Bureau and the solar industry alike.  This is a rare consensus reflecting its core purpose: giving developers and landowners clear, predictable rules for the full life cycle of a solar project while protecting host property owners from being saddled with removal costs.

2.  Effective Date

The Act has a two-track effective date, which developers should calendar carefully:

• Section 4304 (form and content of decommissioning plans) took effect immediately upon enactment on July 20, 2026.
• The remainder of the Act including the core decommissioning (§ 4302), financial-assurance (§ 4303), and preemption (§ 4306) provisions takes effect 180 days after enactment, on or about January 16, 2027.

This staggered timing matters because most of the substantive obligations attach to lease agreements executed after the applicable effective date.

3.  Summary of the Decommissioning Requirements

For covered projects, the Act imposes an integrated set of obligations:

Decommissioning obligation (§ 4302)

• The solar energy facility agreement must make the grantee (the facility owner) responsible for decommissioning the facility.
• Decommissioning must be completed no later than 18 months after the facility ceases producing electricity unless the grantee is actively working to recommence production (for example, following a force majeure event).

Financial assurance (§ 4303)

• The grantee must file proof of financial assurance with the county recorder of deeds and provide notice to the surface property owner.
• The amount must equal the estimated cost to decommission the facility, recalculated every five years by a third-party professional engineer selected from a DEP-maintained list.
• A phased schedule ramps the required assurance up over the project’s life roughly 10% pre-construction, rising to 100% less salvage value by the 25th anniversary of the commencement of construction.
• Acceptable forms include an escrow account, certificate of deposit, irrevocable letter of credit, corporate surety bond, or government bond.
• The assurance runs with the facility: on a change of ownership, a prior grantee may not revoke its assurance until the new grantee posts replacement assurance and notifies the property owner.

Scope of removal & restoration (§ 4304)

• Removal of all non-utility-owned equipment, conduits, structures, fencing, and foundations (to at least three feet below grade), plus graveled areas and access roads.
• Restoration of the land to a condition reasonably similar to its pre-construction state, including replacement of topsoil and reseeding of cleared areas.

Forced-labor prevention (§ 4305) & preemption (§ 4306)

• The grantee must attest to compliance with federal law restricting goods made with forced labor (e.g., the Uyghur Forced Labor Prevention Act).
• The Act preempts local ordinances and regulations governing solar decommissioning, creating a single statewide standard (discussed further in Section 6).

4.  Nuances for Leases and Lease Options

Because the Act keys its obligations to when a lease is “executed,” timing is everything. Three scenarios deserve close attention:

Leases already in effect

The Act is prospective. Section 4302 applies only to an agreement “executed after the effective date,” and § 4303 applies only to a grantee who “executes” an agreement “on or after” that date. A lease genuinely executed and in effect before the effective date should fall outside the decommissioning and financial-assurance obligations. (Note, however, that the forced-labor attestation keys to construction commenced on or after the effective date, so a pre-existing lease whose construction begins later can still trigger that requirement.)

Lease options

An option to lease is not itself the “solar energy facility agreement” the Act regulates—the operative document is the lease that authorizes operation of the facility. A developer therefore cannot rely on a pre-effective-date option to escape the Act: if the option is exercised and the lease is executed after the effective date, the Act will apply. To grandfather a project, the actual lease—not merely the option—should be executed before the effective date.

Amended or extended leases and options

This is the gray area. The statute keys to “execution” and is silent on amendments, extensions, and renewals. A ministerial amendment (e.g., correcting a legal description) most likely does not trigger the Act. But a material amendment or a term extension executed after the effective date—particularly one that prolongs the operational life of the facility—carries real risk of being treated as a new “execution” that pulls an otherwise grandfathered project into the regime. Given the statute’s remedial purpose and the provision binding successor owners, the conservative course is to assume post-effective-date material amendments and extensions may trigger the Act, and to build in appropriate savings language.

5.  Behind-the-Meter Net Metering vs. Front-of-the-Meter Utility-Scale Projects

Perhaps the most consequential feature of the Act for our clients is § 4307, which exempts several categories of projects entirely. Chapter 43 does not apply to (a) certain small-capacity facilities (2 MW AC and under), (b) a customer-generator as defined in the Alternative Energy Portfolio Standards (AEPS) Act, or (c) a normal agricultural operation.

This draws a bright line between two very different kinds of solar project:

A key point on the customer-generator exemption: the Act incorporates the statutory AEPS definition, which contains no independent “retail load” requirement. In Hommrich v. Commonwealth, 231 A.3d 1027 (Pa. Cmwlth. 2020), aff’d (Pa. 2021), the courts struck down the PUC’s regulatory attempt to require independent on-site load, holding that a non-utility owner may net meter so long as “any portion” of its generation offsets its own electrical requirement. As a result, a genuine ≤ 3 MW, PUC-interconnected, net-metered facility qualifies as a customer-generator—and is exempt from Act 44 regardless of whether it serves significant on-site load. (Developers should note that outdated “independent load” language still appears in 52 Pa. Code § 75.13(a)(1), but it is unenforceable after Hommrich.)

6.  Interaction with Existing Municipal Solar Ordinances

A critical and easily overlooked feature of Act 44 is § 4306, which preempts and invalidates the decommissioning provisions of municipal solar ordinances for covered facilities, effective January 2027. This matters because most municipal ordinances require a decommissioning bond posted to the municipality, whereas Act 44 requires financial assurance recorded with the county recorder of deeds and payable to the surface property owner (landowner). Rather than layering two schemes, Act 44 knocks out the municipal one for covered projects—leaving a single, landowner-focused framework.

Two nuances remain important. First, because § 4307 makes the entire chapter (including the § 4306 preemption) inapplicable to exempt facilities, municipal decommissioning ordinances remain valid and enforceable as to ≤ 2 MW AC facilities, customer-generators, and agricultural operations.  Those projects still answer to the municipality, with no Act 44 landowner scheme. Second, existing (pre-effective-date) covered projects may fall into a transition gap: their municipal bonding requirement is preempted while Act 44’s affirmative obligations do not attach retroactively, potentially leaving a period with no statutory decommissioning security.

Dual-beneficiary bonds

Where a landowner historically insisted on security, developers have sometimes used a dual-beneficiary bond naming both the landowner and the municipality. Because a corporate surety bond is an expressly acceptable form of assurance, such a bond can satisfy Act 44 but only if it is issued in the DEP-prescribed, recorded form; gives the surface property owner an independent, unconditional right to draw the full estimated decommissioning cost without municipal consent or competing claims; and uses release mechanics that track the Act rather than municipal sign-off. Key pitfalls include amount dilution among co-beneficiaries (which can defeat the Act’s full-funding requirement), release-control conflicts, form and recording mismatches, and the Act’s phased funding schedule not aligning with a municipality’s typical up-front bonding demand. For covered facilities, we generally recommend dropping the municipal co-obligee going forward. Its ordinance is preempted and its inclusion adds risk while reserving dual-beneficiary structures for exempt projects, where municipal ordinances survive.

How MPL Law Firm Can Help

Our Renewable Energy practice regularly advises solar developers and landowners on lease structuring, interconnection and net-metering qualification, decommissioning and financial-assurance planning, the interplay with municipal ordinances, and the recording requirements now imposed by Act 44. If you are negotiating a new lease, exercising an option, structuring a decommissioning bond, or evaluating whether an existing project is grandfathered or exempt, we would be glad to help you navigate the new framework.