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Take Action Now - Ask Legislators to Support HF 221!
Contact your legislators today to ask for their support for House File 221 to keep the sun shining in Iowa. Click here to find your legislator and click here for talking points.
BY THE NUMBERS:
The solar credit currently offsets up to 13% of the cost of a solar project. The credit caps of $5,000 (residential) and $20,000 (business) encourage many smaller projects across the state.
Between 2012 and 2020, Iowa provided solar tax incentives of $36.6M, which resulted in 6,213 solar projects and a total investment of $291 million.*
This means the state credit has leveraged about $7 for every $1 of state investment.
POWERING IOWA'S ECONOMY:
The state solar tax credit has also driven solar job growth in Iowa from about 350 jobs in 2015 to almost 900 in 2019.
There are 85 Iowa companies in the solar supply chain that range from very small manufacturers to parts to engineering to installers.
SUCCESS HAS LED TO OVERSUBSCRIPTION:
As solar has become more attractive and accessible, the credit has been oversubscribed and become a victim of its own success, limiting investment in solar – especially business investment – and leveling off job growth.
Iowa’s solar credit has been oversubscribed since 2015, resulting in a growing waitlist every year. In 2020, 99.7% of the tax credit cap was committed before the year even started, meaning fewer than five residential projects installed in 2020 will receive 2020 tax credits.
The waiting list for 2021 credits was $6.77 Million as of December 11, 2020. IDOR estimates it will be $8-9 Million by the time eligibility closes for the year, sending applicants deep into 2023. That means customers purchasing solar this year will be waiting at least two years to claim a credit.
De-couple Iowa’s credit from the federal tax credit and extend through 2031
Currently, Iowa’s solar tax credit is scheduled to phase out next year. If the state legislature doesn't act, all those on the current waitlist are at risk of never receiving their tax credit for projects already installed.
Pay down the current wait list
This will allow flexibility for people who are eligible for the credit to use it when they need it most as the economy recovers. It will also immediately make credits available for new installations, spurring investment.
Increase the cap from $5 Million to $10 Million per year
Increasing the cap would boost solar industry job growth, as certainty around increased annual investments would allow solar businesses to hire. Raising the cap would also likely increase solar investments by non-solar businesses that need certainty around when they will receive a tax credit.
*Iowa Department of Revenue solar tax credit annual report for 2020, https://tax.iowa.gov/sites/default/files/2020-12/SolarEnergySystemTaxCreditAnnualReport2020.pdf