Last week President Bush signed into law the Tax Relief and Health Care Act of 2006, which includes legislation extending clean energy-related tax credits through 2008. Originally set to expire in 2007, the credits include a 30 percent credit for homeowners who invest in a solar energy system for electricity or heating water (max of $2,000), a 30 percent credit for businesses that invest in solar energy systems (no limit), and the extension of the production tax credit (PTC) for wind power.

Policies like these are vital to the renewable energy industry and to businesses and homeowners wanting to make the switch to cleaner, more efficient energy. But we could do even better if these credits were stable and long-term. Consistent policies for clean energy keep the market going, investor interest high, and cost increasingly lower. Rhone Resch, President of the Solar Energy Industries Association (SEIA), agrees:

"While this bill does not constitute a long-term solar growth policy, it does provide some breathing room for solar projects in the 12- to 18-month pipeline…It ensures that the solar industry will continue to grow at a record rate in 2007. The passage of this bill with an extension of the solar ITC is recognition by Congress that solar is indispensable to our clean energy future."

SEIA and other renewable energy interest groups like the American Wind Energy Association will be lobbying the new Congress for long-term extensions.

American Wind Energy Association
Fact Sheet: Tax Relief and Health Care Act of 2006
Solar Energy Industries Association