Friday, November 18, 2016

The Future of Solar Tax Credits in Utah: Part 3



The ongoing effort to resolve Utah's solar tax credit conundrum came to a head this week as my proposed bill was presented at committee for a hearing.  I offered a visual presentation to help make my points.  Here is the slideshow:





Once my presentation was completed, the committee began to ask some very good questions on the subject.  Then, the meeting was opened to public comment.  The Utah Solar Energy Association opposed the bill and made their case to the committee.  However, the committee was not impressed by the lack of effort made by the USEA to negotiate or offer input on the bill proposal.  In my opinion, it appears the USEA believed they could simply make the bill go away by lobbying behind the scenes and ignoring discussion of the issue directly.  That turned out to be a losing formula.

The committee hearing was very pointed in its discussion of the issue and disappointment in stakeholder behavior.  You can hear the presentation and sharp committee rebuke here:



 
Of course, the Salt Lake Tribute's own Pat Bagley wasted no time caricaturing the debate:



This is my first time being featured in one of his cartoons.  So, I guess this means I have "arrived".  But, I do have to take issue with the way that he chose to draw me...my suit isn't that blue.  

Now that the bill has passed committee, I will be reaching out to stakeholders for a final round table to see if any final adjustments can be agreed upon by industry, stakeholders, and the Legislature.  From there, the bill will be presented for votes in both the House and Senate during the General Session.  

7 comments:

  1. I have two questions and a statement about this matter;
    1.The people hired to work the tax credit, will their jobs($75,000/year/person) end when the tax credit ends or will they be on payroll forever?
    2. Why could the tax credit not be spread throughout the whole Utah budget instead of just the schools?
    a.It seems to me the tax credit should have had an end when it was put in place. It’s not like this is the first time the state has given a tax credit for an energy something.

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  2. Brent,

    1. The answer to that is based on market dynamics. Even the solar industry doesn't have an answer to this question. If demand continues to grow even after the tax credit expires, then jobs would remain. If demand decreases, then jobs would be lost. So far, noboby had made a case that demand will shrink of the tax credit expires. If anything, growth will just slow down but continue.

    2. To spread the tax credit throughout the budget it would need to be appropriated from the general fund. Those allocations are made on a yearly basis and requested yearly at committee meetings. So far, the legislature and industry have been cold to that idea (I have proposed it with other tax credits) because it would cause a political fight every year on the issue. Income tax credits have been a preferred tool for the exact reason that they are 'invisible' politically once they are passed. My Tax Credit Review bill that passed is designed to shed light on all of these credits so they are not out of sight or out of mind of the Legislature.

    Thanks for your thoughts.

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  3. We looked into buying solar panels for our house and decided not to. The tax credits we may or may not have qualified for were considered in our decision, as was the tremendous amount of debt we would have incurred had we gone forward with it. Maybe we were wrong, but while a $2000 "discount" due to tax credits might have helped us a little financially had we chosen to do it, it really wasn't enough money to be a decision-changer. I believe it won't impact the solar industry enough to really hurt their bottom line, and our children's educations are much more important long-term. Thanks for all you are doing, Jeremy!

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  5. Your argument seems to be "solar is booming, therefore removing the tax credit will have no impact." If that's true, why have tax credits or subsidies for any company or industry that's doing well (as, however unfortunately, is depicted in the cartoon)?

    If removing it does indeed slow the growth of solar, as market economics suggests it would, why take the risk on our already terrible air quality? Demand will shrink. I won't buy them without it, therefore one household not buying them = shrinkage. There's your case.

    Our schools desperately need the money and there are many other places to raise revenues to help them. Your argument doesn't hold up for me.

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  6. Hello Unknown,

    Contrary to popular belief, rooftop solar does little if anything to improve Wasatch Front air quality. All of our electrical generation (and accompanying generation of pollutants) occurs in remote rural locations away from Wasatch Front. Solar Tax Credits are not the only ones being addressed. Others are being scrutinized as well. NOTE: The incentives referenced in the cartoon do not receive Education budget money. Those funds came from the General fund (sales tax revenue). Income tax credits on the other hand directly affect the school budget. Look for more tax credits on the chopping block soon.

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  7. Hi Jeremy,

    I just wanted to circle back and thank you for engaging me on this topic. Unfortunately I wasn't swayed by your argument that the pollution all happens in rural areas and thus has no impact on our air quality but you got to me read a new perspective I hadn't thought of and, more importantly, took the time to engage a random Utah citizen. For that, thanks.

    -Billy

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Welcome! Your comments and thoughts are greatly appreciated. Criticism, insights, questions and queries are always welcome. However, please be civil and composed in your presentation.