U.S. solar industry in urgent push to extend tax incentive
As world leaders convene in Paris to forge a pact to curb carbon emissions, the U.S. solar industry is pushing to seal a smaller deal in Washington that for it is arguably more urgent: preventing a key clean energy incentive from disappearing.
Solar supporters want U.S. lawmakers to extend a 30 percent tax credit for solar installations, possibly as part of a package of renewed temporary tax breaks Congress is working to pass in the next two weeks, industry lobbyists and executives said.
The tax credit is currently slated to step down to 10 percent for commercial solar systems, and expire for residential systems, at the end of 2016.
The industry says extending the 30 percent tax credit now will help companies gear up for investments next year, rather than spending 2016 preparing for a rollback.
"It's critical that leaders act this year to give certainty to solar workers," said Bryan Miller, senior vice president of public policy and power markets at Sunrun Inc, one of the largest U.S. solar companies.
The Investment Tax Credit for solar energy systems has helped underpin an annual growth rate of 76 percent in solar installations over the last decade, according to the Solar Energy Industries Association.
Nearly 200,000 people work in the U.S. solar industry, and SEIA estimates 100,000 jobs would be lost in solar and related industries in 2017 if the policy lapses.
The solar industry, including SEIA and top solar companies SolarCity Corp, First Solar Inc, Abengoa SA, SunEdison Inc and Sunrun, has spent more than $2 million lobbying Congress this year, according to public records compiled by the Center for Responsive Politics.
SolarCity in October ratcheted down growth projections for next year, saying it was focused on preserving cash to weather the expiration of the ITC.
The credit has allowed SolarCity and others to utilize so-called tax equity financing, in which investors like U.S. Bancorp and Alphabet Inc put money into solar projects and then use the credit to reduce their tax burden.
At least one solar company wants the credit go away. John Berger, chief executive of residential solar company Sunnova, is meeting with legislators in Washington this week telling them not to pass an extension.
Sunnova, backed energy veterans with oil and gas experience, said the solar industry is mature enough to compete without subsidies and would attract more traditional forms of funding if the ITC were eliminated.
(Editing by Terry and Alan Crosby)
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