Amid Boom, U.S. Solar Energy Fears End of Gov't Incentives


"The industry could fall short of long-term goals if two key federal programs dry up."

SolveClimate, Maria Gallucci

U.S. solar energy installations are poised to double in 2011 for the second year in a row, but the industry could fall short of its long-term goals for growth if two key federal programs dry up, officials say.

"We are in reach of our goal of installing 10GW of solar annually by 2015," Tom Kimbis, vice president of strategy and external affairs for the Solar Energy Industries Association (SEIA), told reporters.

"But to reach that goal, Congress needs to make the right investments in solar energy," he said.

"This is going to be a time when we see enormous changes. . .and everything that comes with the maturation of a sector is going to be compressed into a very short period of time. . .," Kann added.

The 1603 treasury program gives cash grants to cover 30% of the cost of a renewable energy project, in lieu of a 30% investment tax credit. The U.S. Treasury thus far has given $936M in stimulus grants to nearly 2,200 solar projects, according to an ongoing tally by SEIA.

Kimbis said SEIA is lobbying to extend the cash grant part of the program beyond October 2012—when final applications to get the incentive are due—to 2016, when the entire treasury program expires.

The DOE's Section 1705 loan guarantee program helps solar developers to secure funding by promising to pay back loans if borrowers default. The DOE so far has offered a total of $10.4B in loan guarantees to 11 solar projects. The program is set to end on Sept. 30 this year if it is not renewed.

"We are working with the administration and Congress to make sure that with the expiration of the stimulus [funding], the loan guarantee program will be able to roll over," Kimbis said.

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