Solar energy has always been a mixed bag. Many praise its cost efficiency and environmental impact, while others keep pointing out the steep entry fee. However, over the past few years, going solar has been getting cheaper. Thanks to The Federal Solar Tax Credit, a lot of households went green. But that might soon change. With no extension on the horizon, the fate of cheap solar energy seems doomed. As a result, every energy company should now give their statement on legislation to extend the Federal Solar Tax Credit.
What is the Federal Solar Tax Credit?
Also known as the Investment Tax Credit (ITC), The Federal Solar Tax Credit helps you pay for a solar energy system. It works by deducting a percentage of the cost of installation from your federal taxes. That applies to both residential and commercial systems, so you can use it for your own business.
While the ITC has no cap on its value, it’s important to know that there are only specific percentages deducted. The system works on a yearly basis, with different percent values based on the year we are in:
- 30% in 2019
- 26% in 2020
- 22% in 2021
- 10% in 2022 and on wards — only for business solar system installations
Even though it seems weird for the deduction to lower each year, the original plan was far more nefarious. First introduced in 2006, the Federal Solar Tax Credit was supposed to expire in 2007. But thanks to extension bills, millions of households and businesses have been helped with going solar.
What Will Happen Next?
There is a strong push coming from the solar energy industry towards a new extension of the credit. With backing from some communities and local governments, a new bill might be on the horizon.
In July 2019, a couple of US senators proposed a bill that would see the ITC extended by 5 more years. Even though not yet fully approved, the bill is rounding up more support each month. With a new election and therefore a new president, the chances of approval are rising each passing day.
Statement on Legislation to Extend the Federal Solar Tax Credit
Atlantic Key Energy fully endorses any legislation that would allow the extension of the Federal Solar Tax Credit. We believe that the popularity of solar systems will keep growing in the future. Such a law will help median-income families make the transition to solar. Also, businesses will feel encouraged to make the same changes.
We understand why some parties might be opposed to an extension, citing the impact on the economy. However, the upsides of switching to solar energy outweigh any negatives. Saving our planet should have no price tag.
Approving such an extension will require strong support from the US Senate and House. Citizens want to know that the government cares about the planet. Supporting the legislation will prove that. An extension will be beneficial to both the state and its citizens.
Furthermore, the government has a responsibility to protect the jobs of energy workers. Without the ITC, interest in residential solar energy systems might plummet. That will result in loss of jobs and bankruptcy. Extending the Credit will mean saving the jobs of thousands of American citizens.
The government needs to act and take part in the fight against pollution and climate change. The end of the Federal Solar Tax Credit means the end of progress. Don’t stop the progress — extend it.
Although a new extension has not been fully approved, we believe that now is the time for a strong push. The political and environmental changes are both good reasons to pass a new bill. A roadblock in the legislative process means a roadblock in our planet’s healing process. Any statement on legislation to extend the Federal Solar Tax Credit is a step towards becoming a green country.