TO SUPPORT SUN

Exploring The Available Tax Credits For Solar Developers And Manufacturers
Jessica Lillian, 11 January 2011 (Solar Industry Magazine)

"The U.S. Department of the Treasury's Section 1603 cash-grant program, popularly known as the Treasury Grant Program or the TGP, received a great deal of attention at the end of last year, as the solar sector worked feverishly to see this essential program extended…[T]he full story of federal money for solar companies - and its availability year to year - is much larger than one program…[S]olar advocates should focus on four key finance-related priorities when working with national and state-level legislators…

"First…existing 48C provisions - which allow manufacturers of solar energy equipment to claim a 30% tax credit - must be extended. Members of Congress are expected to, at least, be amenable to considering extension…With credit-renewal efforts should come evidence that the credit is helping the industry make noticeable strides…"

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"Next, solar companies should pursue extension of alternative minimum tax (AMT) turnoff provisions…A little-known tax law change in the small-business bill that was passed in September 2010 allowed companies paying AMT to take advantage of research and development (R&D) tax credits…Without this provision, as many as eight out of 10 solar companies could not cost-effectively use R&D credits…

"In addition…solar companies should push to expand the existing federal R&D credit to make it more beneficial and globally competitive…Finally, on the state level… the refundable tax credits available in Minnesota, Louisiana and New York [are] highly attractive…[S]olar firms located in those states - or considering a move there – [should] take full advantage of these offerings…Policymakers in other states may be convinced to offer similar tax credits - if they hear convincing arguments from their constituents…"

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"…[T]he TGP… can be a viable part of long-term incentive infrastructure, but for the best chance at garnering legislators' support…the solar sector should be careful to avoid immediately pushing for the program's permanence - and make sure to stress its timely economic benefits…

"Overall, although some solar advocates have expressed concern about advancing their agenda with the new, more Republican-leaning Congress…current policymakers have a keen interest in pursuing energy independence…[so] the renewable energy industry's voices will be heard…"