If Congress doesn’t act soon, many federal credits that have fueled the rapid growth of wind and solar energy in recent years will expire at the end of this year. Here are some of the key programs that would be affected:
Solar investment tax credit: The government now pays 30 percent of the cost to businesses to invest in solar power to meet their energy needs. Cost to extend for 10 years: $1.7 billion.
Residential energy-efficient property tax credit: Residential users also get a 30 percent tax credit for installing solar panels, geothermal heat pumps or small wind equipment. The tax credit, however, has a limit of $2,000, which lawmakers are trying to raise. Cost to extend for 10 years: $907 million.
Renewable energy production tax credit: This program gives wind, solar, geothermal and other renewable power sources a leg up with a 1.9-cent per kilowatt-hour credit, which makes them more competitive with natural gas or coal-fired power plants. Congress has let the tax credit lapse before, and each time investment in wind and other renewable energy projects dropped. Cost to extend for one year: $7 billion.
And while a lapse in federal solar tax credits would impact the end consumer, it would have an even greater impact on the industry and its investors.
∙ Here Comes The Sun: San Francisco’s Solar Subsidy Program Adopted [SocketSite]
∙ Congressional stalemate over renewable energy [SFGate]