SACE | Southern Alliance for Clean Energy

Congress Votes to Extend Renewable Energy Tax Credits


Critical extensions will bolster solar and wind development in the region and create thousands of local jobs

Contact: Jennifer Rennicks, SACE, 865.235.1448


Washington D.C. (December 18, 2015) In an historic vote, Congress has officially extended renewable energy tax credits essential for wind energy and solar power development. Included in the lengthy omnibus spending package, the tax credits for both wind and solar were extended for multiple years with moderate phase out plans.

“Extending renewable energy tax credits is a step in the right direction and sets the stage for continued development of clean and affordable energy across the country, including here in the Southeast.” said Dr. Stephen Smith, executive director of the Southern Alliance for Clean Energy. “The Southeast is our country’s next frontier for wind energy and solar power development, and Congress’ act to extend tax credits for renewable energy will bolster our region’s clean energy economy.”

The renewable energy tax credit extensions go hand in hand with the dropping cost of wind and solar energy, making this a win-win scenario for both clean energy generation and fiscal restraint. According to analysis from Bloomberg Energy Finance, the solar power Investment Tax Credit (ITC) extension could result in the development of 20 additional gigawatts of solar energy, and the wind energy Production Tax Credit (PTC) could result in an additional 19 gigawatts of wind energy, over the next five years. Additionally, it is estimated that the extensions will result in $73 billion of investment and the creation of thousands of new, local jobs across the country.

The solar power ITC was extended through 2022, phasing down from its current starting point of 30 percent for residential and commercial installations. In 2020, the ITC will decrease to 26 percent, in 2021, it will decrease to 22 percent, and in 2022 it will decrease to permanently to 10 percent for non-residential and third party owned systems and 0 percent for host-owned residential. The ITC also includes a “commence construction” clause, which would allow the tax credit to be applied for a particular year as long as the construction begins in that year.

According to the American Wind Energy Association, “the Production Tax Credit and alternate Investment Tax Credit would be extended for 2015 and 2016, and continue at 80 percent of present value in 2017, 60 percent in 2018, and 40 percent in 2019. As before, the rules will allow wind projects to qualify as long as they start construction before the end of the period.”

The five-year extension of the wind energy PTC will provide stability and predictability for the wind industry, which had previously been subject to short-term extensions for the tax credit. This stability is expected to encourage further industry growth and more local jobs. The Department of Energy projected that the wind energy industry could support up to 380,000 jobs by 2020, drastically up from today’s 73,000.

Renewable energy tax credit extensions will play an important role in complying with the federal Clean Power Plan. These credits will allow for greater investment in clean energy generation and will provide a clear path for states to increase their renewable energy capacity to meet goals set in the Clean Power Plan.




Founded in 1985, the Southern Alliance for Clean Energy promotes responsible energy choices that work to address the impacts of global climate change and ensure clean, safe, and healthy communities throughout the Southeast. Learn more at