Dive Brief:
- Utah Gov. Gary Herbert (R)has signed House Bill 23, a measure to phase out tax credits for the purchase of rooftop solar systems by 2021.
- Rooftop solar customers can currently claim $2,000 of tax credits on their state tax return, but now that amount will be reduced by $400 a year starting in 2018 until completely phased out.
- The state is looking to boost its clean power and last month, Utah Clean Energy said the state needs to make changes to its energy market in order to encourage renewable energy.
Dive Insight:
Rather than enacting a cap on the aggregate amount of tax credits the state would make available, the law Herbert signed will use a step-down approach that limits how much of a tax credit each solar customer can receive. In 2018, the credit will drop to $1,600 and decline $400 annually until eventually eliminated.
The solar industry didn't put up much of a fight: "Realizing the political pressures and budgetary pressures this year, we aren't contesting this," Ryan Evans, president of the Utah Solar Energy Association, said in February.
Meanwhile, other policy battles over rooftop solar compensation are shaping up. Rocky Mountain Power proposed reducing the net metering credit, which involves a three-tier rate design including a fixed fee and demand charge, has been shelved while the utility looks for "mutually acceptable solutions" with the solar industry.
Rocky Mountain Power's net metering proposal would have applied the new rates for customers seeking interconnection and included a $15 fixed customer charge and a $0.03/kWh charge for the amount of energy used.
Proceedings over RMP's proposal are scheduled for later spring of this year.
