Stimulate with Solar -- Let's Get America Working Now for the Future

America's New Year's gift will be a $750 billion stimulus bill prepped and passed this month in Washington. Congress and the Obama team have made it clear that green energy jobs and infrastructure will be key elements of this package.

Building out solar jobs and installations should be a key ingredient of this platform. In terms of "shovel-ready" projects, solar is able to deliver jobs and clean energy quickly at a great return on investment.

There are two things holding back solar right now which can be easily fixed in the stimulus bill:

1. The disappearance of tax equity investors --

Since all the traditional investors in solar projects who did so to gain the tax credits to shelter profits now have no profits, they are out of the game. This includes Morgan Stanley, Wells Fargo and others.

To fix this, let's make solar tax credits refundable for at least two years.

2. 30% is not enough in a downturn

The Congress renewed the solar tax credit at 30% this past October. While in normal economic times that might be fine, it is not cutting it in this downturn.

States have pulled back their subsidies or have delayed new ones. Residential and small commercial customers who do not seek financing in many cases would install solar with a greater incentive.

We recommend increasing the federal solar tax incentive to 50% for two years -- 2009 and 2010 -- that would catalyze a wave of solar installation in the US. That is great timing since the cost of solar panels has plummeted.

The cost of increasing the solar tax credit for 2 years to 50% is only $353 million -- a small amount in a $750+ billion bill.

These two moves will also create the jobs for all the retrained green collar workers to fill. Congress intends on funding the Green Jobs Act at $500 million in the stimulus. Where will all these workers go to work? We must create demand for the jobs and solar is one the fastest ways to scale up green energy.

Let your member of Congress know how you feel about solar -- 2 quick fixes can make a world of difference.

Comments

[Alex Kelley]

A larger tax incentive would be one way to get small scale solar projects (both PV and solar water heating) off the ground. Even better would be low interest solar loans. One way to look at the current solar economics is that a system owner is prepaying for years worth of clean energy. A loan program would reshape this paradigm to look a lot more like the current, pay-per-month system that we all know and understand. Tax based incentive strategies are great for the large system owners, but there is no technical or long-term cost barrier to having solar water heaters on almost every house. This sort of residential building overhaul will make a big dent in our energy dilemma while improving the quality of life of all Americans. Of all the roles for government, this is a great one. Help us look past paycheck to paycheck thinking individuals and do what is right for our communities and our nation. (http://www.solar-werks.com)

[setenergy]

Good stuff, Jack-

Incentives to deploy solar in 2009 and beyond are a smart way to take advantage of the lower solar prices that will emerge in the months ahead. I was excited to see news that solar prices in Europe just hit record lows and prices are beginning to fall globally. See details at: www.setenergy.org

If you find the SET daily blog on major energy and climate developments useful, please consider adding it to y'all's green blogroll.

Onwards to sustainability,
Dennis Markatos-Soriano

[Jesse Jenkins - Huffpost Blogger]

Jack, this is smart, timely policy. A similar effort to free up financing for wind power would also be very timely. It'd also most likely be both costlier and more impacting on the job situation, since the scale of the wind industry is greater than the solar industry. Bob Pollin at UMass Amherst and the author of the "Green Recovery" report recommends loan guarantees to help free up financing for these projects. Just $4 billion or less in federal outlays could help secure $20 billion or more in private financing for clean energy projects. The stimulus should, at a minimum, focus on easy ways like this to keep the booming wind and solar industries growing even through this recession. They are some of the only bright spots in the economy, even before the downturn.

Still, we shouldn't fall into myopic short-term thinking just because we're talking about stimulus. What America needs is a sustained series of public investments to rapidly develop and deploy clean energy technologies like wind and solar and drive down their costs. Basically, we need a long-term strategy to make clean energy cheap and abundant. It could start with these investments, but the final price tag will be much more than a few hundred million - try on the scale of $500 billion over the next decade. We should be positioning the stimulus investments as the down-payment on a sustained effort to make clean energy cheap and abundant.

[newshawk14]

In a sense, the only renewable resource is sunlight, at least for the next billion years or so.
Wind and bio-fuels are also related to sunlight. Other long term sources are tidal, geothermal,
and nuclear fission or fusion. One of the most important sources, is increasing efficiency, which
has the effect of decreasing the need for capital investment in power generation. Since most
electricity is generated by steam driven turbines, which are about 50% efficient, you want to site
other industries in the vicinity, that can utilize the waste heat from the turbines, thereby increasing
the overall efficiency.