Federal Solar Tax Credits Extended for Five Years
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Solar ‘cliff’ of 2016 averted, bright skies ahead.
In the waning hours of the 2015 legislative session, extensions of solar (and wind) tax credits were included in the sweeping 1.5 Trillion Bipartisan budget deal, which won strong bipartisan support in both chambers of the US Congress and received Pres. Barack Obama’s signature on Fri, Dec 18.
Solar tax credits, which were set to expire end of year 2016, now will be:
- 2017-2019: 30% credit (uncapped credit on full amount of solar array).
- 2020: 26% credit.
- 2021: 22% credit.
- 2022 and beyond: 10% credit for non-residential and third-party owned systems, 0% for homeowner-owned systems, though projects that ‘commence construction’ and are completed by end-of-year 2023 will qualify.
Sens. Ayotte (R) and Shaheen (D) of New Hampshire voted YES, as did Collins (R) and King (I) of Maine.
A Milestone for the Industry
As is the case in most big-budget negotiations, there was lots of horse-trading to get a budget deal that could muster bipartisan support. In exchange for the solar and wind tax extensions, Congress revoked a 50-year ban on exporting oil from the U.S.
While this compromise might seem counter-intuitive to the mission of solar, critical analysis has shown that the climate benefits of extending solar and wind credits will vastly outweigh any loss from the repeal of the oil export ban.
Solar, as a nascent industry, is just starting to break openly into the mainstream, and with the ‘extra runway’ provided by the extension of the solar tax credit, the industry is set to truly take off in the next five years.
The Solar Revolution is Here
- Installed solar in the US is expected to DOUBLE over the next five years.
- What does a doubling look like? Roughly 72,000,000 kilowatts of new solar capacity, enough to power 14.5 million homes.
- By 2020, over 3% of all US electricity will come from solar, an increase of 3,000% in a decade.
- Creation of over 220,000 new solar jobs, in an industry that will add more than $30 billion annually into the US economy.
- The additional solar spurred by the extension of the solar tax credits will more than offset any increase in carbon pollution that results from the end of the oil export ban. More importantly, it sets the stage for a permanent, sustainable solar energy industry that will last long beyond 2022, as solar becomes increasingly cost-competitive and the true price of carbon starts to be considered in energy prices.
We at ReVision Energy are grateful that the US Congress has seen the wisdom in continuing to support the solar energy industry as it transitions from ‘startup’ to ‘mainstream’ mode! For our part, we’ve installed a record 5,200 kilowatts of solar in 2015 – nearlydouble what we installed in 2014 – and hired more than 50 new full-time employees to keep up with demand.
Since the industry doesn’t face an installation ‘cliff’ in 2016, we can focus on our core mission: reducing Northern New England’s reliance on fossil fuel energy by continuing to deliver excellent service to our customers and installing and servicing the very best solar energy equipment available in the world.
2015 – This Year in Solar
A few photos from an incredible year installing solar!