Opinion: Extend solar tax credits, temper trade policy
The Trump administration and Congress may soon deal a double blow to American workers, electricity consumers and the burgeoning clean energy economy.
One of the most successful clean energy policies in history — the Investment Tax Credit, or ITC — will begin to phase out next year, unless Congress extends it. Meanwhile, the Trump administration may impose even harsher tariffs on solar panels, making it harder for families and businesses to adopt this environmentally friendly technology.
House and Senate leadership can protect workers, consumers and the environment by extending the credit in any end-of-year deal that goes to the president's desk. And the administration could end its harmful solar tariffs.
With solar taking a growing share of the energy pie, bad trade and tax policy would increasingly hurt everyday Americans' pocketbooks.
The solar ITC has been a resounding success. It offers a 30% tax credit for solar systems on residential and commercial properties. Since 2006, the ITC has helped solar deployment grow by 10,000%. There's enough solar installed today to offset the carbon emissions of 26 million cars. The credit has also helped create more than 200,000 jobs and add $140 billion in private investment to the economy.
But the tax credit is set to gradually phase down starting next year. In 2022, it will expire for homeowners and drop to 10% for businesses.
It'd be a mistake to let the credit wind down. If Congress extends this credit now, we could add another 113,000 jobs, create enough clean power for 15.5 million homes, and generate $87 billion in investment. Unsurprisingly, 89% of Americans support extending tax incentives for renewable energy, according to a November survey.
The development of the solar industry also depends on good trade policy. And the growth of the industry has been held back by Washington politics. In January 2018, the Trump administration slapped massive tariffs on solar panels, causing significant job loss.
There seemed to be a ray of hope in June of this year. The Trump administration announced that it would exempt bifacial solar panels, which generate power from both sides of a panel, from these tariffs.
But last month, with no notice or opportunity for public comment, the administration reversed course and revoked the waiver. That created instability in the solar market, resulting in $1 billion in cancelled orders, according to members of my organization, the Solar Energy Industries Association.
These tariffs hinder the economy. By 2021, our nation will miss out on more than 60,000 solar jobs because of them, according to a new analysis from SEIA.
The U.S. solar industry has bounced back before and will do so again. But a phasedown of the solar tax credit, along with increasingly damaging trade policy, will have negative repercussions for the economy and clean affordable power for many years to come.
Whether a Democrat or a Republican, the bottom line is clear. To protect, jobs, the economy and the environment, it's crucial to extend the solar tax credit and nix harmful tariffs.
Abigail Ross Hopper is the president and CEO of the Solar Energy Industries Association, the national trade organization for America's solar energy industries.