Tax season is fast approaching, and that means it’s time to take advantage of the solar investment tax credit (ITC). If you have purchased a residential or commercial solar energy system, then I have good news--you may be eligible to receive 30 percent back of what you paid for your system!
The Energy Policy Act of 2005 created a 30 percent ITC for residential and commercial solar energy systems as an incentive to increase solar installations. The ITC went into effect in 2006 and it has worked tremendously well. So much so, in fact, that it was extended eight years by the Emergency Economic Stabilization Act of 2008 and again in 2015 by the Omnibus Appropriations Act.
Since the ITC was introduced solar installations have increased by over 1,600 percent. The ITC is currently set at 30 percent through 2019 but will drop to 26 percent beginning in 2020, then to 22 percent in 2021. After 2021 it will finally drop to zero for residential installations and 10 percent for commercial and utility installations (so take advantage of it now to realize its full benefits).
Regardless of the eventual decline in savings, the ITC has been a tremendous benefit to the solar energy movement. According to 2015 statistics by the Solar Energy Industries Association (SEIA), there has been 59% compound annual solar growth since the ITC was enacted. The SEIA also declares that the ITC extension will have triggered the addition of 220,000 solar jobs between 2015 and 2020 and an estimated additional $40 billion in investing between 2016 and 2020.
Further, the SEIA states on their website, “...we expect the roughly 53 gigawatts of solar energy cumulatively installed in the US at the end of 2017 to reach more than 100 GW by the end of 2022. Moreover, the roughly 250,000 Americans currently employed in solar is expected to nearly double to 420,000 in the same time period - all this while spurring roughly $140 billion in economic activity.”
So it’s abundantly clear that while the solar ITC is providing immense cost savings for solar consumers, it has also driven economic growth and created enormous job expansion in one of America’s fastest-growing industries. If you have recently invested in solar, Green Solar Technologies thanks you and urges you to see if you are eligible to take advantage of the solar ITC while its benefits are still at their peak.
To learn more, check out our Federal Tax Credit YouTube video.