As US Congress negotiates the new federal budget, it is seeking to make drastic cuts to clean energy tax credits to fund extension of the 2017 Tax Cuts and Jobs Act.
However, the cost savings of cutting solar tax credits far outweighs the benefits, found analysis from the Solar Energy Industries Association (SEIA), the Brattle Group, and the University of Louisiana.
SEIA estimated solar tax credits cost about $25 billion per year. But the benefits to US ratepayers far outweighs this cost, it found. NERA Economic consulting found that cutting energy tax credits would raise average utility bills by 7% for residential customers and 10% for small businesses. Analysis from the Brattle Group found that solar tax credits lower electricity costs for US ratepayers by a combined $51 billion per year, more than double the cost of the credits.
What’s more, analysis from SEIA and the University of Louisiana found that the solar industry generates $12 billion in federal tax revenues and $3.7 billion in state and local tax revenues each year.
All told, SEIA estimated that US ratepayers in total save $2.67 per $1 in solar tax credit spending.
