Tag Archive for: Blog

New Federal Solar Tax Credit Resources Available 

The U.S. Department of Energy and the Solar Energy Technologies Office (SETO) have developed new resources to help Americans navigate changes in the solar Investment Tax Credit (ITC) that occurred after the passing of the Inflation Reduction Act (IRA) in 2022. The resources, intended for business owners, homeowners, and manufacturers, provide in-depth overviews of the ITC, Production Tax Credit (PTC), and Advanced Manufacturing Production Tax Credit (MPTC).  

The resources explain the process of claiming tax credits, answer frequently asked questions, and explain the tax code through examples. Titles include Homeowner’s Guide to the Federal Tax Credit for Solar Photovoltaics, Federal Tax Credits for Businesses, Federal Solar Tax Credits for Manufacturers, Get Answers to the Future of Solar Energy Development, and More Questions about IRA’s Tax Incentives. 

Homeowner’s Guide to the Federal Tax Credit for Solar Photovoltaics 

This resource will help homeowners understand how the IRA can help them save money on solar energy. It explains that the federal residential solar energy tax credit can be claimed on federal income taxes for a percentage of the taxpayer’s cost to install a photovoltaic system. 

The guide includes an explanation of the federal solar tax credit and answers questions about eligibility to claim the credit. A list of expenses that can be included in the tax credit is provided, along with descriptions of how other incentives might affect the tax credit, such as payments for renewable energy certificates, state tax credits, and state rebates.  

Federal Tax Credits for Businesses 

This resource provides an overview of the tax credits available for businesses, including for purchase of solar energy systems. It includes a summary of the ITC and the PTC values from 2006 to 2033. The chart includes base rates and full rates for both credits. 

The guide also explains which credit is right for you, what expenses are eligible for the ITC, and labor requirements for projects, as well as providing details on bonus credits, including a low-income bonus. You’ll also find descriptions of how tax-exempt organizations can benefit from the federal tax credit for businesses. You can also learn what happens to unused tax credits, including tax equity financing details and carryback and carryforward rules.  

Federal Solar Tax Credits for Manufacturers 

This resource  explains the Advanced Manufacturing Production Tax Credit (45X MPTC) and the Advanced Energy Project Investment Tax Credit (48C ITC) and helps manufacturers decide which tax credit is best for them, as they cannot claim both.  

The guide summarizes eligibility guidelines for advanced manufacturing production tax credits, including PV module and subcomponents, PV inverters, PV tracking systems, batteries, and critical minerals. It includes a useful chart that shows when tax credits phase out and the tax credit for eligible U.S.-produced components in various years. 

You’ll also find information of 48 ITC, including availability of credits, criteria for application, and details about the direct-pay option and transfer of credit for manufacturers. 

Webinar: Reaching for the Solar Future: How the Inflation Reduction Act Impacts Solar Deployment and Expands Manufacturing 

This webinar discusses the broader implications of SETO’s Solar Futures Study analysis. It answers questions such as: Are there any incentives for nonprofit organizations to install clean energy devices—solar or heat pumps? Is there a sense of what the application process for the ITC for nontaxable entities will look like, and timing for when we might know? Do school districts qualify for the 30% ITC, and can non-tax entities pass the savings along to the installer or designer like E-Pact? 

With these resources available, Americans can now confidently navigate the changes in the ITC resulting from the IRA. Homeowners, businesses, and manufacturers will benefit from the examples and explanations provided in these resources surrounding solar tax credits and incentives.  

Community AgriSolar: Merging Agrisolar and Community Solar 

Merging community solar and agrisolar could aid the Department of Energy’s (DOE) goal of saving $1 billion in energy costs through community solar by 2025. Not only would merging community solar and agrisolar help DOE reach that goal, but would also provide other opportunities and benefits such as the regeneration of soil on solar sites, reducing fuel-operated maintenance demands, and increasing the likelihood of future solar development(s). 

What is community solar? 

Community solar could be an ideal method for low-income households who might be looking to use solar energy and use Low-Income Home Energy Assistance Program (LIHEAP) assistance to pay for their energy bills. LIHEAP funds cannot be used for things like up-front installation costs of typical solar participation methods (non-community solar) or the household ultimately owning the solar equipment. Community solar participation eliminates these issues due to the solar farm and panels not being developed, owned or operated by the LIHEAP recipient.  

LIHEAP Participants Would Lead to More Energy Savings 

Community solar often includes what is known as subscription-based community solar programs (SBCSPs), where a household “rents” solar panels and uses solar energy without the associated conditions and costs of installing solar panels, operating them, or owning them. These conditions of using solar energy typically would not qualify a low-income household to use LIHEAP funds for solar fuel. However, SBCSPs could provide a way for low-income households to be able to use LIHEAP benefit payments for solar fuel through subscription-based community solar programs because the household would not ultimately own the equipment or have to pay for its installation or maintenance costs. 

If LIHEAP participants are eligible for SBCSPs, then more people can participate in saving energy by using community agrisolar, which ultimately assists in the identified goal of the Department of Energy (DOE) in reaching $1 billion in energy savings through community solar by 2025. 

Why merge agrisolar with community solar? 

Community solar has been identified by DOE as a method of reaching energy savings goals by 2025, which includes saving $1 billion in energy costs. Merging agrisolar with community solar developments would not only aid in significant energy savings but would also make future solar developments more likely to be approved—expanding energy savings even further. 

Agrisolar operations like the Cabriejo Ranch in Missouri has shown that agrisolar provides a variety of energy saving methods as well as regenerating the land used by solar farms. The ranch uses Dorper sheep to manage the vegetation on solar operations, which drastically reduces the use of fuel-operated maintenance equipment typically used to manage vegetation. The sheep not only reduce these energy costs, but dramatically increase the health of the soil .  

The likelihood of a solar farm being approved for development is higher when Agrisolar is incorporated into the operations. This was seen in the Garnet Mesa project that was denied due to concerns about losing valuable farmland to the solar-farm development. The project was approved after changes were made to include 1,000 grazing sheep on the solar farm. 

The Possibilities of Merging Agrisolar and Community Solar   

 More participants saving more energy would be a win-win for reaching energy-and-cost savings goals.  

Not only do energy savings goals have a higher likelihood of being achieved through merging community solar and agrisolar, but other benefits of using agrisolar would also be made possible, such as regenerating soil health through grazing practices and supporting  job creations in local communities such as grazing management and farm operations jobs created in Missouri. These benefits of using agrisolar in solar development increases the likelihood of future solar developments by proving the land can be effectively utilized while occupied by solar equipment and operations.  

Welcome to the AgriSolar Clearinghouse

Solar developments are expected to cover 3 million acres of land in the next ten years. Under traditional solar development, these lands could be taken over for energy-only production and this could impact pollinator habitat, food production, soil health, and cultural landscapes. But, there is tremendous opportunity for low-impact solar development that is complementary with sustainable agriculture. This co-location, when designed and managed with best practices, can increase pollinator habitat, promote native species, and include grazing and specialty crop production, all while diversifying revenue streams and increasing public acceptance.

In our sustainable energy and agriculture work at the National Center for Appropriate Technology (NCAT), we have a long reputation as a trusted, practical connector. We are a non-profit with a mission to help people build resilient communities through local and sustainable solutions that reduce poverty, strengthen self-reliance, and protect natural resources. As a part of this mission, we sought and received funding from the Department of Energy Solar Energy Technologies Office to develop an information-sharing, relationship-building, clearinghouse for all things agrisolar.  

Our incredible network of partners and stakeholders includes the leading agrisolar experts in the country. They hail from national energy laboratories, the Smithsonian, universities, solar industry, agriculture, pollinator organizations, solar grazing associations, and rural policy centers. Together, we hope to promote the co-location of solar and agriculture in a way that is beneficial to both.

In coming months, this website will showcase practical, affordable agrisolar solutions through case studies, peer mentoring, field trips, best practices, webinars, podcasts, and peer-reviewed research. Our online forum will provide a place to connect in real-time with NCAT specialists, partners, stakeholders, and agrisolar enthusiasts. I hope you’ll find inspiration, information, and a community in these pages. And I hope we can learn from you as we grow. Please tell us your story.

STACIE PETERSON
Energy Program Director