The Coalition for Clean Energy Jobs and Innovation is calling on political leaders to prioritize clean energy in upcoming infrastructure legislation.
More than 100 organizations representing clean energy interests, manufacturers, homebuilders, electric cooperatives and a variety of other industries sent a letter to President Joe Biden, Speaker Nancy Pelosi and Leader Chuck Schumer, urging them to enact a 10-year extension of the section 25D and 48 Investment Tax Credit (ITC) and a direct pay option for projects claiming the ITC.
“Solar and storage are proven job creators that can modernize America’s power grid and tackle the climate crisis,” said Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association (SEIA). “These are economywide benefits that extend far beyond just one industry, and that’s why a diverse coalition of leaders representing multiple sectors, technologies and communities are asking Congress for long-term policy certainty for clean energy infrastructure. The solar and storage industry stands ready to put Americans back to work, but Congress must act now to unleash the clean energy economy.”
The coalition believes a 10-year extension of the ITC would give businesses the certainty needed to make long-term investments and drive clean energy deployment at the scale needed to tackle climate change. In addition, a direct pay provision would make project financing less dependent on the availability of tax equity, speeding deployment and pandemic-driven economic challenges affecting clean energy companies, the coalition stated in a press release.
“The long-term extension of the ITC will help ensure America continues to be the leader in technology innovation by helping scale up clean energy industries like the fuel cell and hydrogen sector, fuel economic growth, and protect the environment,” said Morry Markowitz, president of the Fuel Cell and Hydrogen Energy Association.
To reach 100% clean electricity by 2035, annual solar deployment from 2024 to 2028 will need to be twice as large as the current forecast. The solar ITC was responsible for a 10,000% increase in the size of the solar industry from 2006 to 2019 and continues to be one of the most influential solar policies. Wood Mackenzie found that the recent two-year extension of the ITC increased solar installation forecasts by 17%.
Passing long-term clean energy policies will drive deployment and help to create hundreds of thousands of jobs. Over 400,000 Americans work in the industries supported by the ITC. According to the National Solar Jobs Census 2020, the solar industry will need to grow to more than 900,000 workers by 2035 to support the level of deployment needed to reach President Biden’s 100% clean electricity target.
The ITC is the umbrella term for Section 25D and 48 tax credits that cover clean energy sources such as solar, geothermal, fuel cells, combined heat and power, and distributed wind. Since it was passed in 2005 by a Republican-led Congress, the ITC has driven innovation and investments in clean energy. Combined, the section 48 and 25D industries add billions of dollars in investment to our economy annually, lowering electricity costs and significantly cutting carbon emissions.
News item from SEIA
Solarman says
” The solar ITC was responsible for a 10,000% increase in the size of the solar industry from 2006 to 2019 and continues to be one of the most influential solar policies. Wood Mackenzie found that the recent two-year extension of the ITC increased solar installation forecasts by 17%.”
Here’s a short historical look back at 2005 before the ITC was passed. For years I’d wanted solar PV. In 2003 I began a search for more information on the costs of solar PV on one’s home. A lot of the information then was for ‘off grid’ systems, are to this day invaluable data to use in one’s quest for a personal system of their own. In 2005 I found my local utility had a ‘program’ that had money set aside for something called a REC. The utility would get a REC for every so much power produced by grid tied solar PV in the utility service area. I also found out that a weighted solar PV in rated A.C. watts would allow me $2.50/watt subsidy for a grid tied solar PV system. I finally found an electrical contractor in another town to do the work. In 2005 top of the line solar PV panels were running at $1,100 dollars per panel retail, I required 48 of them to do what I wanted to do. The total installed cost without subsidy, $71K the actual installed with subsidy $51K, about $6.10/watt installed. The ‘simple ROI’ was 22 years to payoff. The actual came out to 13 to 14 years as electricity rates continued to rise over those 12 years of solar PV array ownership. The ‘new’ home in 2017 when the solar PV was installed on this roof, I was in a ‘transition’ phase where I could not use the ITC. So, in 2017 I had twice the grid tied solar PV installed on the roof for $3.50/watt, (unsubsidized). Panels now are typically 330 watts and are running around $1/watt and roughly $330 per panel.
The old system had a warranty of 25 years for solar PV panels, but only 10 years on the inverters. The new system, I have 25 years warranty on the solar PV panels and 25 years on the grid tied inverters. In 2021 most ESS units are warrantied for 10 years of service, one ESS, off the top of my head is Sonnen which says warranty for 15 years. This too shall pass and there will be a day (soon) when higher energy density battery packs for ESS use will allow cheaper, longer lasting, smaller packaging of energy storage of from 60kWh to 150kWh and these too will have a 25 year system’s warranty.
The old utility foisted narrative is an old tired sick animal, laying on the ground getting it’s guts kicked out by the solar PV adopters across this country. This uni-directional grid business model is that animal and the utilities that won’t digitize the grid into a bi-directional grid with such programs like EaaS, Energy as a Service, partnerships with residential, housing tract, town micro-grids as VPP units, will put this dying animal and the utility that still tries to “ride it”, in the ground.