President Biden unveiled his infrastructure plan this week. It’s a massive $2 trillion investment over eight years. The proposal is aptly named the “American Jobs Plan.” It looks to spur job growth while addressing the aging infrastructure. We have previously covered what a Biden presidency could potentially mean for solar energy and other renewables. The infrastructure bill includes $174 billion designated to address climate change directly. The bill intends to boost the electric vehicle market while another $100 billion is committed to upgrading the nation’s electrical grid. These efforts put the country on track for Biden’s goal of zero-emission by 2050.
Federal Funding For Solar
Biden spoke about his plan in Pittsburgh on April 31st, “If we act now, in 50 years people are going to look back and say: ‘This was the moment that America won the future.’” Federal buildings will receive funds to help convert to 100% renewable energy. Solar and wind will provide energy for national institutions. This direct investment will spur growth in the market. By improving the electrical grid, our renewable energy assets are better protected. However, federal spending isn’t the only pro-solar stimulus. Additionally, the “American Jobs Plan” will extend the solar ITC investment tax credit, another decade. Extending the tax credit is a significant move for the Biden administration. Allowing the public to take advantage of solar energy by making it more affordable and more accessible is perhaps the most detrimental investment in solar. The private market will thrive because of the ITC extension and immediate federal funding into renewable energy.
The Plan Will Expand The ITC
The 10-year extension of the solar ITC is an enormous incentive. We constantly bring up the importance of the federal tax credit. It is worth 26% and is a dollar-for-dollar tax credit that includes everything in your solar investment. Tim Sylvia of PV Magazine wrote, “solar made it into the American Jobs Plan in the form of a proposed 10-year extension and phase down of an expanded direct-pay investment tax credit and production tax credit for clean energy generation and storage. The plan would also use the federal government’s purchasing power to secure 24/7 clean power for federal buildings.” The Solar ITC extension paired with the newly proposed “tax credit for large-scale energy generation and storage” will increase private investment within the solar market. Companies and homeowners can take advantage of these tax incentives. Increasing access and affordability helps everybody.
What Is The Significance?
CNBC’s Emma Newburger reported, “If signed into law, the proposal would rank as one of the largest federal efforts ever to curb the country’s greenhouse gas emissions and advance the president’s commitment to put the country on a path to net-zero carbon emissions by 2050.” Long-term tax incentives, funding the transition to EV vehicles, and renewable energy for federal buildings are significant steps in the right direction. The plan will be debated in Congress and possibly amended. Critics have said that the program doesn’t do enough or is too friendly towards industries. However, the solar, federal ITC will help the residential sector and businesses, utilities, and corporations. It will take everyone to do their part. Reach out to your congressional representatives in support of this bill and the ITC extension. More must be done, and this plan attempts to put renewable energy at the forefront in rebuilding American infrastructure, but it starts with us. To learn more about the federal ITC, check out our blog. For a free quote in the Sarasota area, click here.