The incentives in question come in the form of a new-and-improved suite of clean energy tax credits. At its core, a tax credit reduces the amount of money you pay to the federal government. Simply put, in the case of clean energy tax credits, if you decide to install photovoltaic panels or take advantage of your local community solar garden, you’d pay less in taxes at the end of the year as a result.
And it’s not just individuals who could benefit. These credits could make it feasible for your local congregation to put solar on its roof, and give states the confidence to develop plans to install solar on the sides of interstates or on school roofs. Tax credits through 2030 will give institutions, whether it’s churches, towns or states, the confidence of knowing they have the long-term financial support to invest in new clean energy projects.
Tax credits are the behind-the-scenes workhorses largely responsible for the growth of clean energy over the past decade. Wind energy has tripled since the enactment of tax credits by 2009, and solar has seen annual growth of 52% nationwide. In the wake of Hurricane Ida, Environment America’s energy program director, Johanna Neumann, talked to Louisiana residents. In every single case, those who had solar on their roof pointed to state and federal tax credits as a key reason for installing these clean energy marvels. In addition, they said the choice to go solar also helped them weather power-outages caused by the storm.
For the 40% of Americans who live in coastal states, this new suite of tax credits could be a game-changer when it comes to tapping offshore wind. We have enough offshore wind potential to power the country almost twice over. The first large-scale project in the nation was approved earlier this year and is slated to power 400,000 homes in Massachusetts with clean renewable energy that doesn’t pollute. We’ve barely scratched the surface of our offshore wind potential, and long-term tax credits will enable us to fully take advantage of this abundant renewable resource. You can find more about how much energy your state could be getting from offshore wind here.
What makes these changes particularly important is that they would update and extend clean energy tax credits by 10 years (until at least 2033). This will set the course for long-term growth in clean energy because when the new neighbors move in across the street in five years, they’ll see your solar panels and won’t have to worry if they can get the same financial incentives. In fact, whether it’s investing in a heat pump or making your home more energy-efficient, tax credits can help.