Solar are taking a hit after the industry’s trade group, the Solar Energy Industries Association, posted an alert on its website Friday suggesting Congress may pass an energy bill with no solar Investment Tax Credits (ITC).
The site stated “there are widespread reports that a decision has been made, at least provisionally, to move energy legislation without a tax title that extends the Solar Investment Tax Credits.”
There has been no confirmation that congressional leaders will fail to pass extensions for the ITC, which allow commercial system owners a 30% tax credit against the total cost of solar systems.
However, if the credit were to expire in 2008, it could reduce the demand for solar systems among commercial customers. According to Stephen Chin, an analyst at UBS, these customers accounted for 41% of 2006 solar installations.
The U.S. represents only 10% of the solar-products market, but as seen in the last two days, U.S. policy decisions could have widespread effects on the industry.
However, some analysts are not worried. Jonathan Hoopes, a ThinkEquity Partners analyst told the Associated Press, “With oil treading near $100 per barrel, we fully expect Congress to figure out a way to work incentives (be they voluntary or compulsory) for renewable energy into legislation that will not be vetoed in the near term,”
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