Tax credits for residential solar energy projects to end this year

BAKERSFIELD, Calif. (KBAK/KBFX) — With the signing of a new bill into law, tax credits for residential solar energy projects will be phased out by the end of the year.

The tax credit incentive, initially set to run for six more years before gradually decreasing, will now be eliminated after December.

Steve Saeger, sales manager at Quality Home Services, explained, “In the most recent house resolution bill that passed, they are essentially removing the residential tax credit through section 25D from 30% to 0%.”

Saeger, who has been in the solar energy industry for over a decade, noted that discussions about tax credits have occurred frequently, but this is the first time the industry is preparing for such a significant change.

Despite the impending phase-out, Saeger believes solar energy will continue to offer financial benefits, particularly in California.

“At the end of the day, Fresno and Bakersfield have the highest cost of electricity out of any cities in the country. I think Fresno is number one and Bakersfield is number two. So, tax credit or no tax credit, I feel that solar and storage is going to be an opportunity for homeowners to save money,” he said.

A report by CashNetUSA highlighted that homeowners in Fresno spent over $3,000 on electricity last year, while those in Bakersfield spent just over $2,900, ranking them as the top two most expensive cities for electricity costs.

Saeger also emphasized the self-sufficiency that solar energy provides homeowners. “We can offer backup power in an outage so you get additional features for that in a kind of an interesting way of looking at it so, on a PSPS event, you won’t have to worry about your food going bad or you’ll be able to have those creature comforts,” he said.