Policies regarding renewable technology are currently taking place at the nation’s capital, and solar power is prominently situated at the top of the list. With members of each house of Congress, the president, and regulatory agencies pushing a clean, renewable energy agenda, government officials and industry members are trying to advance several issues surrounding solar power. An issue currently receiving a great deal of attention is the Solar Investment Tax Credit (ITC).

  • Solar Investment Tax Credit
    • The ITC is one of the most important federal policy mechanisms to support the deployment of solar energy in the United States. Established in 2006 and administered by the Internal Revenue Service, the ITC is a 30 percent tax credit for solar systems on residential (under Section 25D) and commercial (under Section 48) properties. The residential and commercial solar ITC has helped annual solar installation grow by over 1,600 percent since its implementation – a compound growth rate of 76 percent.
    • While the ITC was initially set to expire on December 31, 2016, in December 2015, Congress passed a spending bill that extended the ITC for an additional 5-years. Under the extension, the ITC is stepped down from 30 percent to 10 percent until 2024. Projects that commence by the end of 2019 will receive the current 30 percent ITC credit, projects that start construction in 2020 are eligible for a 26 percent credit, and projects that start construction in 2020 are eligible for a 22 percent credit. To receive each ITC rate, projects must be completed by 2024.
    • The existence of the ITC through 2023 provides market certainty for companies to develop long-term investments that drive completion and technological innovation, which in turn, lowers costs for consumers.
  • Current and Recent Issues:
    • Amdt. 3120, King-Reid Amendment:
      • In January 2016, Senators King (I-ME) and Reid (D-NV) introduced the King-Reid Amendment to amend the Energy Policy Modernization Act of 2015.
      • The Amendment would have limited the authority of state agencies and utilities to retroactively change net metering rates for existing customers.
      • The Senate Energy and Natural Resources Committee voted against the amendment.