Solar power has been steadily increasing in the United States as more affordable options are available through tax benefits and state incentives such as net metering. With the federal tax credits set to expire at the end of 2016, the future of solar was uncertain. US lawmakers came together and voted to extend tax credits for both solar and wind. This gave a bright outlook for those companies working in renewable forms of energy such as wind and solar. The extended tax credit allows people to purchase solar panels for a discounted price and save money on electric bills. Overall, this is a very big win for the solar and wind industry in the United States.
The federal tax credit of 30 percent was set to expire at the end of 2016, leaving many people wondering how that would impact the fields of renewable energy. Not many people expected that the government would extend the tax credit an additional five years through 2022. Even more that they would keep it at the same rate of 30 percent, but that is exactly what they did.
As time continues forward and advancements in solar and wind technologies increase, the price for systems will decrease, meaning less need for the tax credits. After the tax credit has met its time limit in 2022, it is expected that the tax rate will drop down to about ten percent.
The expansion is estimated to generate $38 billion of investment in solar and $35 billion in wind.
The announcement comes at the perfect time as many solar companies are working to generate as much business as possible to allow everyone to meet the current tax credit rate. This meant that there was in increase of labor costs, equipment and financing. Now that there is a visible five year stability plan, many companies are able to slow down. Tom Werner, CEO of SunPower Corp., stated that this will allow for long-term visibility, financing will be more economical and rates will have a lower risk premium.
We, at Sol-Up, are excited about the news and what it means for our customers and the future of solar energy in Las Vegas. Contact us for a solar estimate and to go solar today.