Regardless of where you fall on the political spectrum, one thing is clear: Solar energy in America is — and continues to be — a sound and viable investment option.
We have sifted through the many perspectives regarding president-elect Donald Trump’s impact on clean energy and believe strong economics and wide popularity will continue to make solar a top energy choice among residents, business and utilities nationwide.
That being said, we can’t deny some level of risk to solar financial incentives such as the Investment Tax Credit (ITC). That’s why we urge you to look at your plans for 2017 and consider adding new solar investments to your portfolio today.
SDC Energy has lined up additional funding opportunities and is ready to help you complete the projects in 2017 and secure your above average returns for the next 10-15 years.
Risk Reward Graph
So what are the risks, really?
The ITC is currently designed to scale down programmatically over the next few years. Some believe the new administration will leave the ITC intact because it is already a scale-down legislation, while others fear Trump will cut Federal tax credits to free up cash to pay for the tax reforms so widely talked about on the campaign trail.
But let’s be clear about one thing: your tax benefits for your current projects are safeguarded for the entire term of your contract, regardless of the new administration’s future plans for Federal incentives. Projects that are already funded will continue to earn revenues for the fixed 10-15 year contract period.
Once a solar system goes live, those revenues go straight into your bank account and both the ITC and the five-year depreciation benefit will be carried over in your “IRS account” and remain safe.
Moreover, analysts do not expect any tax reforms to take effect before 2018. So while uncertainty looms ahead it’s not for today, tomorrow or even ten months from now.But why wait? Get your money working now and lock in high solar returns today and for a decade to come.
Why we still believe solar will continue to thrive?
Globally speaking, we won’t disagree there are reasons for concern: Climate agreements like our Clean Power Act in the U.S. and the international Paris Agreement will likely not be supported by the new administration, delaying U.S. environmental progress at best and threatening the world’s ability to fight global warming at worst.
But we believe solar will continue to shine and here’s why:
1. States Will Continue to Drive Utility Deployment of Solar
States have been active in adopting or increasing Renewable Portfolio Standards (RPSs) that require utilities to sell a specified percentage of renewable electricity. These policies help drive the nation’s $36 billion market for wind, solar and other renewable energy sources.
Thus far, 29 states, Washington, D.C., and three territories have adopted an RPS, while eight states and one territory have set renewable energy goals. With some states like California, Colorado and New York requiring 30 to 40 percent of their total supply from renewable energy and Hawaii with a goal of 100%, we know regional support for clean power will keep moving forward.
2. Big Corporations are Pushing the Solar Front
Some corporations like Google have committed to run entirely on renewable energy in 2017 . Next year, the online giant said that all of its data centers around the world will be entirely powered with energy from wind farms and solar panels. No small feat given Google consumes roughly as much energy as the city of San Francisco.Google is not alone.
According to the Solar Energy Industry Association (SEIA) , solar adoption by large corporations like Target, Walmart and others is on the rise. These corporate powerhouses have installed over one gigawatt of solar thus far, which is equivalent to the electricity needed to power 193,000 homes.
3. Economics Will Keep Solar Thriving Under Trump
This year has seen a remarkable run for solar power. Auctions, where private companies compete for massive contracts to provide electricity, established record after record for cheap solar power. In some regions of Latin America and the Middle East, solar prices are hitting below $30 per megawatt hour (as seen in Chile and Abu Dhabi) – record lows for solar and roughly half the price of competing coal power.
In the U.S. solar projects in Arizona and Nevada are coming in at less than $40 a megawatt-hour, compared to average lifetime costs of $52 for natural gas plants and about $65 for coal. Understanding these are large, utility-scale projects, we are now in a world where economics trump environmental rules and government subsidies as the key drivers for clean power.
4. Blue and Red American Voters Support Clean Power
People of all political persuasions in the U.S. want cleaner energy. And that’s not just because there are now more American solar jobs than jobs in oil and gas extraction. Across the board — from the most hardcore conservatives to the staunchest liberals — Americans support “taking action” to support clean energy.
Conservatives across the spectrum want cleaner energy and politicians to support it. A new survey of 1,000 people conducted by the Republican polling firm Public Opinion Strategies shows 75 percent of Trump voters support “action to accelerate the deployment and use of clean energy” — including solar, wind, energy efficiency, and community renewable projects.
5. Untapped SMB Market is Prime for Solar
At SDC Energy, we focus on small- and medium-sized businesses (SMBs) because of the lucrative opportunities they represents for solar investors. While residential and utility-scale solar have enjoyed explosive growth, many of the small businesses, churches, warehouses and shopping centers across the country are under-served, while their large roofs present an enormous opportunity for investment.
We work with contractors and SMBs to generate investment opportunities and share the value of solar financing, helping funders achieve their desired economic goals and SMBs reap the benefits of solar.
We remain positive to solar’s continued growth, specifically in California and Hawaii where we have developed multiple projects that stand ready to fund with attractive terms. Join us in 2017 and reap the rewards.