Just this week, Congress passed an extensive omnibus spending package that included $900 million in coronavirus relief, in addition to plenty of energy and environmental provisions. This is great news for the health of the environment on many counts, and it’s also good news for homeowners and businesses that want to go solar. That’s because the solar investment tax credit (ITC), which was scheduled to drop from 26% to 22% in 2021, will continue at a rate of 26% for an additional two years.
This means that solar projects in all sectors — including residential, commercial, and industrial — that start construction in 2021 and 2022 will still receive the 26% tax credit. The incentive drops to 22% in 2023, and beginning in 2024 it will decrease to 0% for homeowners. The commercial and utility markets will still benefit from a permanent 10% credit starting in January 2024.
So why is this such a big deal? The ITC has drastically reduced the cost of a solar energy system for countless homeowners and businesses across the US, making it easier to transition to a cleaner, more sustainable form of energy. Congressional leaders and bipartisan mayors alike have been introducing bills in the last few years in an effort to extend the solar ITC, but until now, nothing has made it very far. That’s why this new announcement is a major win for the environment — and for American energy consumers.
In the coming years, we’ll have the opportunity for a cleaner and more equitable American energy economy, thanks to this federal rebate extension that makes it easier to switch to solar power.