You probably don’t read about energy news quite as much as we do – but you might still know that it’s been a pretty good week for clean energy. In this week’s news roundup, we’ll discuss two exciting clean energy initiatives: a new bill that could provide big savings for those looking to go solar and a plan from the oval office to make solar more accessible for low-income families.
U.S. Senate closest yet to passing climate legislation
In our last energy news roundup, we explained that despite increased pressure from utilities and solar companies, Joe Manchin, a Democratic senator from West Virginia, expressed that he still wouldn’t support the Build Back Better Act. However, in a huge pivot, Manchin agreed to a new climate and tax plan, the Inflation Reduction Act, on Wednesday.
This is a big deal. Because it’s a budget reconciliation companion package to the Infrastructure Investment and Jobs Act passed last year, the bill only needs a simple majority to pass (as opposed to the 60 percent vote typically required to bypass the filibuster). However, while receiving Manchin’s support is a huge milestone, the bill still isn’t a guarantee: Kyrsten Sinema, a Democratic senator from Arizona, has expressed concerns over previous climate legislation and has yet to opine on the newest bill. Here are some of things to be excited about in the bill:
An expansion of the residential solar tax credit (ITC) back to 30 percent for systems installed between 2022 and 2032 (which will include you even if you go solar before it officially passes – so there’s no need to wait and see!) This includes a phase out of the ITC to 26 percent in 2033 and to 22 percent in 2034.
An expansion of the ITC to standalone storage.
An extension of the $7,500 electric vehicle (EV) tax credit and a new $4,000 tax credit for used EVs if you make less than $75,000 annually (or $150,000 if you file your taxes jointly).
A production tax credit (PTC) for solar projects, which would provide tax credits on a per kilowatt-hour (kWh) basis instead of a one-time credit to investors of large-scale projects.
$30 billion in tax credits towards producing solar panels, wind turbines, and batteries and critical minerals processing.
$10 billion in tax credits towards clean technology manufacturing.
Through the Defense Production Act, $500 million towards heat pumps and critical minerals processing.
Significant progress towards the Biden administration’s clean energy goals.
Overall, this bill would represent the largest climate action ever taken by Congress, if passed. It would help alleviate current supply chain constraints, make clean energy upgrades like solar even more affordable, and help fight rising inflation. To be clear: this bill has not yet passed and might not. However, Congress is set to vote on it before the end of the fiscal year (September 30).
New plan announced to help low-income families go solar
On Wednesday, the Biden administration released a plan to connect low-income residents that participate in government-run assistance programs with community solar projects with verified cost savings. Community solar is a great option for those who rent or aren’t able to install solar on their property, generating roughly 10 percent in savings annually for the average subscriber. However, those that participate in the program should expect between 20-50 percent in savings, according to the Department of Energy.
The Biden administration predicts that the program would generate 134 gigawatts (GW) of new solar capacity, representing a 38 percent increase from today, while contributing to significant electricity bill savings.
Comments