Senators Gordon Smith (R-OR) and Ken Salazar (D-CO) introduced legislation to stimulate investment in solar power.
The Solar Energy Industries Association praised Senators Salazar and Smith for sponsoring S. 590, the "Securing America’s Energy Independence Act." The bill would extend and expand solar energy investment tax credits for homeowners and businesses through 2016. Under current law, the credits are set to expire at the end of next year.
"Renewable energy sources such as solar are critical for the future of our national security, our economy and our environment," said Senator Salazar. "This bill provides a long-term extension of investment tax credits that will generate thousands of high-quality renewable energy jobs and make solar power more affordable for millions of Americans. I will work with my colleagues on both sides of the aisle to ensure that Congress makes the solar ITC extension a priority as we work to jump-start a clean energy infrastructure in the United States."
Original Senate cosponsors included Senators Olympia Snowe (R-ME), Robert Menendez (D-NJ), Richard Lugar (R-IN), John Kerry (D-MA), Edward Kennedy (D-MA), Wayne Allard (R-CO), Ron Wyden (D-OR), Joseph Lieberman (D-CT), Frank Lautenberg (D-NJ), Maria Cantwell (D-WA), and Mary Landrieu (D-LA).
The Energy Policy Act of 2005 provided a 30% tax credit for solar systems purchased for both residential and business applications. However, these credits will expire after two years without legislative remedy, a term too short to encourage significant industry growth. A long-term extension is essential to reducing the cost of solar energy, as it would create market conditions that allow solar companies to make investments and drive down costs through economies of scale. A longer duration will also be needed to help stimulate the development of large-scale concentrating solar power projects.
SEIA estimated that a long-term credit extension would create approximately 55,000 solar industry jobs by 2016 and encourage states to invest billions of dollars in renewable energy infrastructure. Solar energy would displace four trillion cubic feet of natural gas under the bill, saving American consumers $32 billion over equipment lifetimes.
S. 590, the Securing America’s Energy Independence Act includes the following provisions, to take effect for all equipment installed retroactive to January 1, 2007 and going forward:
Residential Solar Tax Credit: Extends a 30-percent tax credit, created in the Energy Policy Act of 2005, for the purchase of residential solar water heating and fuel cell property. Changes the maximum credit to $1,500 for each half-kilowatt of capacity for solar PV equipment and $1,000 for each kilowatt of capacity for fuel cells. Credits may be taken against the alternative minimum tax. Expires after December 31, 2016.
Business Solar Tax Credit and Fuel Cell Tax Credit: Extends a 30-percent business credit, established in the Energy Policy Act of 2005, for the purchase of fuel cell power plants, solar energy property, and fiber-optic property used to illuminate the inside of a structure. Changes the maximum credit to $1,500 for each half-kilowatt of capacity for solar PV equipment. Credits may be taken against the alternative minimum tax. Expires after December 31, 2016.
Accelerated Depreciation: Creates a three-year accelerated depreciation period for all solar equipment eligible for the business solar tax credit.
Loading...