Federal tax break for solar energy has been extendedDecember 23, 2015
Congress has ensured that the solar energy industry will continue to receive support
The future of solar energy in the United States has just become brighter. Congress has approved an extension for the federal tax break that has supported the development of solar projects. Following concerns from various organizations that support the solar industry, Congress has ensured that tax breaks will still be available for another five years. Initially, the federal tax break was set to expire at the end of 2016, which may have put a great deal of pressure on the solar industry.
Pressure on solar developers has been eased
Developers throughout the country are expected to add 11.9 gigawatts of solar energy capacity to the U.S. next year. Many of these developers had raced o ensure that their projects would qualify for the existing tax break. With the five-year extension, however, companies no longer need to rush to qualify for tax breaks. The extension will provide developers with long-term visibility, allowing them to better plan for the future, especially when it comes to hiring during the coming boom of the solar energy market.
Residential sector shows great love for solar energy
The extension of the tax break may be particularly good news for the residential sector, where solar energy is thriving. Many homeowners and builders have praised solar power for its environmentally friendly nature, as well as its relatively low cost. Many homeowners have been embracing solar power as it can help them save costs on energy, and developers have been taking advantage of the interest that the residential sector has shown in this form of clean energy.
California will have to expand net metering rules to benefit from tax break extension
While the tax break extension may be good for the solar industry as a whole, it may have limited impact in California, where solar energy has been growing quickly. The state’s major utilities are expected to hit a cap on net metering at some point next year. Unless net metering rules are expanded, these utilities will no longer be able to provide credit to consumers for the energy their solar power systems produce and send back to the state’s energy grid.