Customers rush to buy solar panels, heat pumps and EVs before federal tax credits end

FREEPORT (WGME) — If you’re planning to buy an electric vehicle or install solar panels, time is running out to take advantage of federal tax credits.

Several clean energy incentives were eliminated by a major tax bill signed into law last week by President Donald Trump. That includes the 30 percent federal tax credit for residential solar projects, which is now set to expire Dec. 31. The new deadline comes years ahead of the original 2032 end date.

The announcement has triggered a surge in demand across Maine, as customers rush to get their project on the books before the credits disappear.

“We are probably going to be booked to the end of the year by the end of August,” Maine Solar Solutions Director of Business Development Aaron Cutterfield said. “This is sort of an artificial demand spike.”

The Freeport-based solar company would typically complete about 300 installations from now until the end of the year. This year, it is hoping to finish between 400 and 500.

Also set to expire Dec. 31 is a federal $2,000 tax credit for residential heat pump installations.

“We’ll see a little bit of an increase in demand from consumers in Maine for the remainder of this calendar year as people try to hurry up and take advantage of this tax credit,” Efficiency Maine Executive Director Michael Stoddard said.

Meanwhile, the tax credit for electric vehicles is ending even sooner: on Sept. 30. That program offers customers up to $7,500 on a new electric vehicle, or $4,000 on a used one.

“Everybody’s always looking for a good deal,” Casco Bay Ford General Manager John Litwinetz said. “When there’s a $7,500 deal on a vehicle that’s going to go away, people are going to flock to it.”

While business owners are welcoming the boost in short-term sales, they acknowledge the surge won’t last, and some expect a slowdown once the incentives disappear.

“It might hurt for a month or two when this goes away,” Litwinetz said. “But people still want to buy these.”

“I expect we might see a slight decline, but I don’t think it’ll be noticeable,” Stoddard said, noting that Maine customers will still be able to access Maine’s rebate program for heat pump installations.

That program can give customers up to $3,000 off their cost, depending on their income level.

And as for the solar industry, Cutterfield estimates it will lead to a 30-40 percent drop in business.

“It certainly isn’t doomsday,” Cutterfield said. “But it is a massive step back and a huge contraction of our entire business model, and I think most of the industry.”