Hazy future for solar power: Uncertainties loom over tax credits, more, but co-op enhances local opportunity

“That went perfect. It was great. It went so well,” he said of his experience in the cooperative and the solar installation that resulted.

Solar power faces clouds on the horizon thanks to things such as the possibility that the “One Big Beautiful Bill” budget reconciliation measure that eventually emerges from Congress will eliminate a 30% tax credit for residential solar projects while also having other impacts on the industry. Also still a question mark is the degree to what level of U.S. tariffs ultimately will be applied to what countries, and how that will affect the cost of imported solar products.

‘We are seeing a … a rush in the residential solar space from individuals who are hearing that the energy tax credit that you get as a customer would go away, so there’s a sort of boost, a short-term boost in people seeking residential solar before the tax credit goes away,” said K.C. Becker, CEO of the Colorado Solar and Storage Association.

Matt Fowler, marketing director and co-owner of the longtime local company Atlasta Solar Center, said that credit, which actually was extended during the first Trump administration, could expire at the end of the year. For people who have been considering getting an estimate on a solar installation, they might want to consider doing that now, “because if this tax credit goes away it could be a big missed opportunity for these folks,” he said.

In other regards when it comes to solar, Becker said that because of the situation with tariffs and uncertainty over the future of other energy tax incentives due to budget reconciliation bill proposals, a lot of capital and investments is “sitting on the sideline, waiting to see what’s going to happen.”

“We’re seeing the onshoring of (solar product) manufacturing that had happened because of the Inflation Reduction Act also stopping,” she said.

She said while President Trump says he wants to onshore manufacturing, the budget bill could take away incentives in the Inflation Reduction Act that encourage onshoring solar manufacturing.

Fowler said Atlasta isn’t too worried about tariffs. That reflects that it gets solar panels from a lot of other countries other than China, a particular target for tariffs by President Trump.

“We haven’t used any Chinese-specific manufacturers in quite some time,” he said.

He said something that has made a difference in the economics of going solar is higher interest rates.

“As interest rates have remained high there’s not a lot of financing of solar,” he said.

It used to be that people could get a loan for solar power and the monthly payments would be less than for an electric bill. That doesn’t tend to be the case now.

Fowler said Atlasta is now seeing situations where people will pay with mostly cash or a mix of cash and financing. Atlasta also is doing a lot more leases versus sales of solar power, and a lot of power purchase agreements, which involves a host having solar panels installed that are owned by a third party, and the host buying the solar power.

THE CO-OP APPROACH

Meanwhile, the launch of another solar co-op in Mesa County by Solar United Neighbors, partnering with the Western Conservation Alliance, Alpine Bank and Cleantech, provides an opportunity for local residents to team up and save on the cost of solar through bulk purchasing power.

SUN has facilitated two solar co-ops in the county since 2020, which has helped 83 homeowners obtain solar power.

An information session on solar technology, the finances of going solar and the new co-op will be held at 6 p.m. on July 22 at The Mesa County Central Library, 443 N. Sixth St., in the Monument Room. Anyone planning to attend is asked to RSVP at https://www.mobilize.us/solarunitedneighbors/event/801571/.

Once 20 or 30 members have joined the co-op, it will issue a request for proposals to local solar installers, and a committee made up of co-op volunteers will review bids and select an installer.

It’s free to join the co-op, and those who join it have no obligation to buy solar panels. They will receiver personalized bids from the installer and then can decide if they want to move forward with their solar installation. Hannah Mitchell, Colorado program associate for SUN, said that altogether a couple of hundred people participated in past co-ops in Mesa County.

“We definitely have an interest in working on the Western Slope. We know that the folks out there appreciate energy independence and you all get a lot of sunshine and so it’s a great area for this work,” she said.

‘MAKES THINGS A LOT EASIER’

Kappius said he and his wife participated in the first co-op. He had begun doing his own research into going solar and was looking into different solar companies when he learned about the co-op.

“I ended up realizing that if anybody’s interested in solar, that’s definitely the way to go, is through one of the co-ops,” he said.

He said it’s a unique program, and he pointed to Solar United Neighbors’ nonprofit status.

“Their main goal is just to help people who are interested in solar, and if it ends up being right for them, they kind of support you through the whole process.”

He particularly likes that SUN eliminates the work of individual homeowners getting multiple price quotes and figuring out companies that are the most reputable.

“I think people need to realize how unique this Solar United Neighbors is. … (The co-op) is really run by the community neighbors but the support that they provide and the education they provide to people who are interested in solar is really cool. It can be daunting just to try and do your own research, but having Solar United Neighbors’ support makes things a lot easier.”

Atlasta ended up installing solar panels on the townhome owned by Kappius and his wife. They now rent out that residence and have built a new house where they also had Atlasta install solar power.

“Right now I’m on track to pay off the whole system in about seven years with the savings” on his electric bill, Kappius said.

Kappius said that’s about the same situation for both of his properties. He said losing the tax credit could mean extending such a payback period for a homeowner to perhaps 10 or 11 years instead of seven.

While the tax credit was appealing to him, he said it wasn’t a make-or-break factor for him. He said he’s an engineer and big fan of renewable energy who did an internship while in college at the National Renewable Energy Laboratory.

“I think for other people, where cost is more of a concern, phasing out the tax credits could deter people” from pursuing solar, he said.

Mitchell said Solar United Neighbors already was planning to work in Mesa County this year when the possibility of the residential tax credit ending surfaced. With that threat now looming, for those who qualify, this year presents the best opportunity to secure not just the group installation discount obtained by the co-op but the federal tax credit. She said her group recommends that people talk to an accountant to be sure they qualify for the credit.

She said with it looking like the tax credit will at least remain in place through the end of this year, the goal of is to have co-op members have their solar installations completed by year’s end.

Fowler said if the residential tax credit goes away, it doesn’t mean that people are going to stop installing solar altogether, but it does change the economics a bit. He said even if installing solar initially costs a little more than a homeowner would have been paying for an electric bill, it can still make sense because utilities are going to increase electricity rates and solar power can save money over the long term.

JOBS IN JEOPARDY

Fowler said Atlasta has about 30 employees. Becker said the solar industry in Colorado directly employs about 8,000 people. She said it’s expected that if the budget bill as currently drafted in the Senate passes, Colorado will see the loss of 5,000 jobs involving direct employees or induced job losses.

She said she think solar accounts for about 11% of power on the grid now. She said there have been huge investments in solar in the past few years, and the rate of increase will really decline if the budget bill as now contemplated passes.

“We will still see projects come on line but not as many, and they’re going to be selling power at a higher rate,” she said.

She said international companies will keep investing and evolving their technologies while the United States won’t be a key player in solar power anymore.

“I think what’s going to happen is we end up ceding a lot of this space to China,” she said.

Becker said the bill is coming at a particularly bad time, with data centers coming on line that need a lot of power, a lot faster than nuclear power can be brought online to help supply it.

“What we’re going to see is just a decrease in reliability in the energy grid, because you can bring solar and wind onto the grid more quickly,” she said.

Said Fowler, “We’ve got a huge demand for US. energy production. Solar is the fastest-to-deploy source of energy. It’s also the cheapest.”

In these uncertain times for the solar industry, Fowler said, “We at Atlasta Solar Center are not panicking. We’re planning.

“We have been stressing to homeowners that there’s potential that this (residential tax credit) could go away, so if (solar) is something that you’ve been thinking about now is the time to at least take a look. We’re not saying that anybody has to do anything but if that goes away it certainly changes the economics, that’s for sure.”