Solar companies in the Bay Area are asking Congress to extend a popular renewable energy tax program that expires at the end of the year.
The 1603 program reimburses companies for a portion of the cost of installing solar projects.
Solar companies benefit from a 30 percent tax credit, but there’s a problem: most companies developing solar projects don’t have enough income to take the deduction. That’s where the 1603 treasury grant program comes in. It gives companies a cash grant up front in place of the tax credit.
“This program really was a fix that brought liquidity back to the market and enabled developers to move forward with their projects,” said Arno Harris, the CEO of Recurrent Energy, a San Francisco-based solar developer. “It’s definitely going to have an impact, if it’s not extended, on our appetite to continue investing in the US solar market.”
And speaking of solar power… After months of roadblocks, the extension on tax credits for renewable energy is one step closer to reality after the Senate yesterday approved the $17 billion package with a 93-2 vote. The credits for wind, solar, and energy efficiency projects are part of “The Renewable Energy and Jobs Creation Act of 2008,” a larger tax bill (HR 6049) that has been stalled in Congress as legislators wrangled over how to fund the credits. If they are not renewed, the incentives will expire at the end of this year, undoubtably having a negative impact on future solar and wind innovation and expansion in the United States.
You can read more about of the current situation in a piece by Ben Gemen at E&E Daily, but to access the article directly, you must be a subscriber. For the rest of us, Climate Progess has posted the story here.