NREL
Abby Hopper and SEIA have been on a virtual listening tour since COVID-19 began.
The group has set out to gather all the information possible from every sector of the solar industry in order to devise a policy plan to keep the industry alive during this devastating time.
“Companies have been generous with their time and really sharing their stories, and I can tell you I’ve read every one of them. They’re heartbreaking,” said Hopper, president and CEO of SEIA.
She and SEIA have heard a few consistent themes that led the group to craft its federal policy priorities to get the industry through the COVID-19 pandemic.
First, companies are having a more difficult time utilizing the solar Investment Tax Credit (ITC). The ITC requires a tax equity appetite to be useful, but in this uncertain economy where businesses are shuttering and over 30 million people are unemployed as of May 1, the tax equity market is constricting, Hopper said.
“We have this very important tax credit that helps finance our projects, and we’re not really able to use it,” Hopper said.
To solve this problem and make sure companies are still able to use the incentive, SEIA’s asking Congress to allow a direct pay option in lieu of the tax credit. Directly paying out the 26% credit to solar homeowners, developers or other stakeholders can help projects move forward.
Next, the solar industry is asking for more time to use the current ITC percentage and safe harbor clause.
The initial 30% ITC began stepping down this year. With stay-at-home orders and other roadblocks now slowing down projects, the solar industry likely won’t be able to take advantage of the 26% ITC in 2020 as Congress initially intended. As a result, SEIA is asking Congress to push out the stepdown deadlines.
“Congress clearly intended us to have the benefit of this year, so let’s push out the deadlines a bit so that we can have the [26%] benefit of this year when businesses are back and up and running,” Hopper said.
SEIA is also asking Congress and the Department of the Treasury for a safe harbor extension for companies that relied on it but might not have received their safe harbor equipment in the 105-day window due to COVID-related manufacturing or shipping delays.
“Obviously, delays that were way outside of anyone’s control and completely unanticipated have happened,” Hopper said.
The group is encouraging solar companies of all sizes to tell their stories to lawmakers and push for the policies the industry needs to get through the crisis and save jobs.
State priorities
On the state level, SEIA worked to get solar construction and O&M classified as “essential work” under federal and state stay-at-home orders. The group successfully got solar incorporated in the Department of Homeland Security’s essential work guidance that many states adopted.
SEIA’s also been working on an even more localized but deeply important issue — keeping solar permitting moving. Many local building offices have closed or switched to remote work, making on-site solar permitting often impossible. SEIA has created a nationwide database of AHJs showing whether they’re still accepting applications and issuing permits. The group is working to help AHJs move solar permitting online.
“We’ve been working on online permitting, but this crisis has accelerated that work,” Hopper said.
NREL’s free, soon-to-come SolarAPP is a key part of this transformation. The online tool offers a standardized way for AHJs nationwide to ensure the code-compliance and safety of solar projects.
SolarAPP became available for AHJs and contractors to test in May and will begin full pilot integration with AHJ software and systems in the summer, according to Jeff Cook, renewable energy policy and market analyst for NREL. A widespread launch is planned for October 2020.
Solar’s role in economic recovery
Hopper said Congress should provide relief for the solar industry because it can help lead the economy out of crisis.
“We’ve proven it before. We’ve shown that if we invest in solar, the market will respond. Private investment will come if we provide some market signals,” she said.
Solar is a job creator as well as a way to expand the local tax base at a time when states and localities are seeing rapidly declining contributions from closed businesses, Hopper said. And maybe most importantly, solar is also a tool for fighting the other crisis the world is facing: climate change.
“We don’t have to choose between these things. We can actually achieve both a solution to the climate crisis, a solution to the declining local revenue, a solution to unemployment, a solution to a constriction of private deployment of capital, in one industry,” Hopper said. “And that’s pretty remarkable.”
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