If you’ve been thinking about going solar, now might be the time to act.
A new draft bill making its way through Congress could eliminate the 30% federal solar Investment Tax Credit (ITC) for homeowners at the end of next year, much earlier than expected.
What’s going on?
The federal solar tax credit, also known as the Residential Clean Energy Credit (Section 25D), currently gives homeowners 30% back on the cost of a solar system. It’s been a key part of making solar more affordable for millions of families across the country.
But under a bill that was just introduced in the House, that credit would disappear after December 31, 2025. Originally, this incentive was set to stay in place until at least 2032. So this change would fast-track that deadline by several years.
At the same time, credits for large-scale utility solar developers (Section 48E and 45Y) would remain in place, though they too would begin phasing down earlier than expected. In other words, big developers get to keep most of their benefits, while everyday homeowners could lose theirs.
What else is in the bill?
Some clean energy incentives survive, like:
- Bonus credits for low-income areas and domestic content, which appear to be preserved.
- Homeowners and developers would no longer be able to transfer or sell their tax credits after two years if this bill passes. That could create new hurdles for financing solar projects.
Why does this matter?
Industry leaders are raising alarms.
According to the Solar Energy Industries Association (SEIA), this bill could derail America’s clean energy progress. SEIA estimates that if passed, it could lead to factory closures, job losses, higher electric bills, and an overall setback for U.S. energy independence.
In short, this proposal could:
- Make solar less accessible for homeowners
- Undermine the growing domestic solar manufacturing industry
- Slow down efforts to modernize and stabilize the electric grid
What happens next?
The bill is currently being reviewed by the House Ways and Means Committee. From there, it would need to be voted on by the full House and Senate before becoming law. There’s still time for changes, and there will likely be a lot of discussion and debate in the coming months.
What can you do?
If you’ve been on the fence about installing solar, this is a good moment to seriously consider moving forward. Locking in your project before the end of 2025 ensures you’re eligible for the full 30% tax credit before any changes take effect.
At Renova Energy, we’ll be keeping a close eye on this bill, and we’ll continue to release updates as the situation evolves. Our team is always here to answer your questions and help you understand how legislation like this might impact your energy plans.
Have questions or ready to go solar?
Contact us today to explore your options with Renova Energy while the full tax credit is still on the table.
