100+ Organizations Urge Congress to Act on a 10-year Investment Tax Credit (ITC) extension
Monday, Jun 21 2021
WASHINGTON, D.C. — Today the Coalition for Clean Energy Jobs and Innovation is calling on political leaders to prioritize clean energy in upcoming infrastructure legislation.
More than 100 organizations representing clean energy interests, manufacturers, homebuilders, electric cooperatives and a variety of other industries sent a letter to President Biden, Speaker Pelosi and Leader Schumer, urging them to enact a ten-year extension of the section 25D and 48 Investment Tax Credit (ITC), and a direct pay option for projects claiming the ITC.
“Solar and storage are proven job creators that can modernize America’s power grid and tackle the climate crisis,” said Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association (SEIA). “These are economywide benefits that extend far beyond just one industry, and that’s why a diverse coalition of leaders representing multiple sectors, technologies and communities are asking Congress for long-term policy certainty for clean energy infrastructure. The solar and storage industry stands ready to put Americans back to work, but Congress must act now to unleash the clean energy economy.”
A ten-year extension of the ITC with direct pay, will give businesses the certainty they need to make long-term investments and drive clean energy deployment at the scale needed to tackle climate change. Adding a direct pay provision will make project financing less dependent on the availability of tax equity. This will help to speed deployment and overcome pandemic-driven economic challenges still affecting clean energy companies.
“Fuel cell technologies and hydrogen energy will be a critical component of America’s future energy policy in helping to both reduce emissions while creating good-paying jobs” said Morry Markowitz, President of the Fuel Cell and Hydrogen Energy Association. “The long-term extension of the ITC will help ensure America continues to be the leader in technology innovation by helping scale up clean energy industries like the fuel cell and hydrogen sector, fuel economic growth, and protect the environment.”
To reach 100% clean electricity by 2035, annual solar deployment from 2024 to 2028 will need to be twice as a large as the current forecast. The solar ITC is a proven policy driver and was responsible for a 10,000% increase in the size of the solar industry from 2006 to 2019 and continues to be one of the most influential solar policies. In fact, Wood Mackenzie found that the recent two-year extension of the ITC increased solar installation forecasts by 17%.
“Geothermal heat pumps are the most efficient technology to heat or cool a home or office building,” said Doug Dougherty, CEO of the Geothermal Exchange Organization. “A long-term extension of the ITC will help our industry achieve better economies of scale, reduce the upfront costs for consumers, and develop innovative financing models. An extension of the ITC will also create thousands of jobs and help our nation reach its climate goals.”
Passing long-term clean energy policies will drive deployment and help to create hundreds of thousands of jobs. Over 400,000 Americans work in the industries supported by the ITC. According to the National Solar Jobs Census 2020, the solar industry will need to grow to more than 900,000 workers by 2035 to support the level of deployment needed to reach President Biden’s 100% clean electricity target.
“Distributed Wind systems, right-sized wind power for homes, farms, and buildings, is poised for explosive growth due to new lower-cost technology and the public’s increasing demand for reliable and affordable electricity,” said Mike Bergey, President of the Distributed Wind Energy Association. “A long-term ITC extension with direct pay would allow retirees, more farmers and disadvantaged communities to participate in the clean energy revolution.”
“Combined heat and power (CHP) is a highly efficient technology that is proven to drastically cut energy bills for America’s manufacturers and commercial building owners, make the grid more reliable, and reduce carbon pollution,” said David Gardiner, Executive Director of the Combined Heat and Power Alliance. “The long-term extension of the ITC for CHP will make America’s manufacturers more competitive while lowering their carbon emissions.”
The ITC is the umbrella term for Section 25D and 48 tax credits that cover clean energy sources such as solar, geothermal, fuel cells, combined heat and power, and distributed wind. Since it was passed in 2005 by a Republican-led Congress, the ITC has driven innovation and investments in clean energy. Combined, the section 48 and 25D industries add billions of dollars in investment to our economy annually, lowering electricity costs and significantly cutting carbon emissions.
The Solar Energy Industries Association® (SEIA) is leading the transformation to a clean energy economy, creating the framework for solar to achieve 20% of U.S. electricity generation by 2030. SEIA works with its 1,000 member companies and other strategic partners to fight for policies that create jobs in every community and shape fair market rules that promote competition and the growth of reliable, low-cost solar power. Founded in 1974, SEIA is the national trade association for the solar and solar + storage industries, building a comprehensive vision for the Solar+ Decade through research, education and advocacy. Visit SEIA online at www.seia.org and follow @SEIA on Twitter, LinkedIn and Instagram.
Morgan Lyons, SEIA's Senior Communications Manager, [email protected] (202) 556-2872