Critical renewable energy incentives renewed

These have been dark years for renewable energy in Washington, D.C., but finally, this past fall, Congress provided real support for solar and wind power in the form of tax incentives, and in so doing, helped California in reaching our Million Solar Roofs goal.

We are hoping this victory is a harbinger of more environmental progress to come.

Few are aware that the $700 billion financial rescue package passed last fall contained the long-awaited extension of renewable energy tax incentives. It is also a little known fact that California’s Million Solar Roofs Initiative depends on those tax incentives.
 
“Regardless of what one thinks about the Wall Street bailout, most want to see the government do more to promote clean, renewable energy,” said Bernadette Del Chiaro, clean energy advocate.

Spurring on clean energy
The federal tax credits apply to renewable technologies—including wind, geothermal and solar power, from large-scale solar plants to rooftop solar photovoltaic and solar hot water systems. Businesses as well as individuals qualify.

The tax credits are a critical driver in meeting the state’s renewable energy goals, including the Million Solar Roofs Initiative.

California’s Million Solar Roofs Initiative aims to build one million solar roofs on new and existing buildings by 2017. The initiative’s goals depend on consumer interest driven by two financial incentives—a state rebate and a federal tax credit.

In 2006, when California passed the Million Solar Roofs Initiative, it was assumed that Congress would meet California half-way by extending the federal tax credits through 2016.
When Congress failed to do so, year after year, it threw California’s programs into question. The tax credits were set to expire on Dec. 31, 2008.

“There was a time when we seriously questioned whether California was going to be able to meet its clean energy goals in the absence of federal support,” said Del Chiaro.

Just in the nick of time, and thanks to the advocacy, media attention and public pressure levied by Environment California and our friends and allies across the country, Congress acted. On Oct. 3, 2008, Congress passed renewable energy tax credits as part of the Emergency Economic Stabilization Act of 2008.

Specifically, the measure extended the 30 percent federal tax credit for solar photovoltaic and solar hot water roofs for homeowners and businesses through 2016; eliminated the $2,000 cap for residential solar systems; allowed Alternative Minimum Tax (AMT) filers to receive the solar credit; and extended the production tax credit for large-scale renewable energy projects, such as large wind and solar power plants.