As the built environment grows, energy demands also grow, and carbon emissions increase. During the past decade, the building design industry has made significant strides in energy efficiency. But efficiency alone will not eliminate the operational carbon footprint of our buildings. You might have heard about Photovoltaic Systems (PV or Solar) in passing, or perhaps you’ve considered it for a project. In many parts of the country, solar power is a very cost-effective, building-level renewable energy strategy. The demand for solar has increased over the years, and the price has fallen significantly as production increases. The graphic below from the National Renewable Energy Laboratory (NREL) illustrates this point.
Solar photovoltaics have been widely used for decades and have proven to be a reliable and predictable energy source. Sounds great, right? But who has surplus funding available to invest in renewable energy? Fortunately, help is available.
The Federal government has increased its commitment to renewable energy production by providing new incentives. The Inflation Reduction Act, passed in August 2022, includes funding for an Investment Tax Credit. A building owner can receive a credit equal to 30% of the installed cost of renewable energy projects. And for the first time, many tax-exempt entities, including state, local, and tribal governments are able to receive the same incentive in the form of a direct payment. Public school districts are eligible for the direct pay option. An additional credit of 10% of the system cost is available if American-made products are used, and another 10% credit is available in certain communities.
The following chart from the Office of Energy Efficiency and Renewable Energy indicates the potential value of investment tax credits and production tax credits available for renewable energy installations under the Inflation Reduction Act of 2022.
According to the EPA, “The Inflation Reduction Act of 2022 is the most significant climate legislation in U.S. history, offering funding, programs, and incentives to accelerate the transition to a clean energy economy and will likely drive significant deployment of new clean electricity resources.”
The needle is moving and funding is available, so don’t miss out. If you would like more information, please reach out to [email protected].