Christmas May Come Early for U.S. Solar, Wind Sectors

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Researched by Industrial Info Resources (Sugar Land, Texas)--By no means is the Inflation Reduction Act of 2022 just about inflation. In fact, the proposed law could plug $369 billion into renewable energy and climate-change measures, including a big dollop of tax credits and incentives for the solar and wind sectors.

Among other things, last week's surprise agreement between Senator Joe Manchin (Democrat-West Virginia) and fellow Democrats on a reconciliation bill, which includes production tax credits for manufacturing of solar panels, wind turbines, electric vehicles and batteries, could drive $30 billion in new investment, according to Canary Media. It also includes a 10-year extension at 30% of the cost of installed solar equipment, which would drop to 26% in 2022 and 22% in 2034, according to PV Magazine USA. The 30% credit also would apply to energy storage, whether it is co-located or installed as standalone. The previous credit only applied to energy storage when it was tied to solar power facilities.

"The entire clean energy industry just breathed an enormous sigh of relief," said American Clean Power Association Chief Executive Officer Heather Zichal in a press release following the announcement of the agreement. "This is an 11th hour reprieve for climate action and clean energy jobs, and America's biggest legislative moment for climate and energy policy."

While the $369 billion in the new measure falls short of the $555 billion in climate-change spending under the Biden administration's failed Build Back Better initiative, renewable-industry representatives still hailed it as a big potential win.

Zichal called the measure the biggest climate and clean energy investment in U.S. energy.

The Senate is expected to vote on the measure before Congress goes into recess at the end of this week.

Industrial Info is tracking more than $600 billion worth of renewable energy projects in various stages of development in the U.S., including more than $326 billion worth of solar projects and $165 billion worth of wind projects. Subscribers to Industrial Info's Global Market Intelligence (GMI) Power Project Database can click here for a list of detailed project reports.

Click on the image at right for a chart showing U.S. renewable project spending investments by market region.

Industrial Info Resources (IIR) is the world's leading provider of market intelligence across the upstream, midstream and downstream energy markets and all other major industrial markets. IIR's Global Market Intelligence Platform (GMI) supports our end-users across their core businesses, and helps them connect trends across multiple markets with access to real, qualified and validated project opportunities. Follow IIR on: LinkedIn.