The renewable electricity industry got an early holiday present this week as Congress included a five-year extension of the Investment Tax Credit (ITC) for renewable energy projects that provides a 30 percent federal tax credit for commercial installations of solar PV systems and new wind energy projects in the tax extenders package. The ITC was set to expire at the end of 2016.
CGE Energy, a company that offers no capital cost energy solutions, commended Congress on their vote for clean energy. According to a company, they make energy projects possible for commercial and nonprofit facilities without having to rely on government stimulus incentives.
“We have made an important focus on not being dependent on the Investment Tax Credit on our project development, especially considering the uncertain future of the credit,” said CGE Energy’s President and CEO Bryan Zaplitny. “Seeing these latest legislative decisions, the utilization of the ITC where appropriate will increase the benefits we can give our customers as well as expedite our growth and stockholder appreciation.”
CGE Energy is also in the midst of bringing to market their own patented vertical axis small wind turbine, called WIND•e20. The 105-foot tall turbine is being manufacturing by Burtek Enterprises, Inc. a well-recognized market leader in safety critical applications.
Bob Keefe, executive director of Environmental Entrepreneurs (E2), noted that the ITC extension gives wind and solar industries the policy certainty they need to plan future investments, create good jobs and continue to see progress on meeting climate change goals.
“This is the latest good news in a monumental week for clean energy. Between the strong Paris agreement, the announcement that another major city – San Diego – is committing to going 100-percent renewable, and now Congress agreeing on a long-term extension of tax incentives, you’re seeing the clean energy revolution continue to build momentum,” said Keefe.
In a report released by GTM Research, the extension of the ITC would result in 25 gigawatts (GW) of additional solar capacity over the next five years – a 54 percent increase over a no-extension scenario, and foster $40 billion in incremental investment in solar between 2016 and 2020.
“The ITC extension currently written into the omnibus spending bill will result in a 20 gigawatt annual solar market in the U.S. by 2020,” said Shayle Kann, senior vice president at GTM Research. “At that rate, more solar will be installed each year than was added to the grid cumulatively through 2014.
The impact will be most pronounced in the utility-scale sector, where ITC extension will increase deployments 73 percent through 2020. “Given price trends in the utility solar sector, the five-year ITC extension will likely result in utility-scale solar contracts being signed for less than 4 cents per kilowatt-hour regularly over the next two years,” added Cory Honeyman, senior analyst at GTM Research.