The solar Investment Tax Credits policy, scheduled to begin stepping down at the end of 2019, is causing quite a stir these days. Nearly 1,000 companies from the U.S. solar industry have petitioned Congress for an extension to the policy’s phaseout. The residential and commercial investment tax credits are set to decrease from 30 percent to 26 percent in 2020, dropping even further to 22 percent in 2021. Under the existing legislation, the residential renewable energy credit will be completely eliminated in 2022, with the commercial component settling at a rate of 10 percent.
A decade of green growth
The ITC launched as part of the 2005 Energy Policy Act, signed into law by President George W. Bush. Congress extended the policy in 2015 with bipartisan support. The program is credited with the creation of more than 200,000 jobs, with the greatest solar employment growth occurring in emerging Midwestern and Southeastern markets including Kansas, North Dakota, Illinois, Alabama and Florida. According to the Bureau of Labor Statistics, solar installation could become the fastest-growing occupation in the U.S.
Additionally, the ITC has led to $140 billion in private sector investment, with solar deployment increasing at a rate of 10,000 percent. This has resulted in significantly lower annual emissions, the equivalent of removing 16 million cars from the roads. Moreover, solar installations have doubled since 2015, with more than 2 million currently in operation across the country.