SPW talks with tax expert: Utility-scale solar is not hit as bad as you think

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The recent discussions surrounding the Senate's budget bill have revealed significant changes to solar tax credits, particularly affecting utility-scale solar projects. Matt Kaden, a tax expert from Baker Tilly, emphasized that while some extreme measures were removed, the phasedown of non-residential solar tax credits is complex. He noted that starting construction in 2025 could allow developers to avoid certain restrictions on components, while projects starting in 2026 would need to comply with material assistance rules, requiring a percentage of U.S.-manufactured components.

Kaden also highlighted the importance of storage in the solar industry, noting that the Senate bill does not impose the same restrictions on storage projects, providing a longer runway for developers. He discussed the challenges utility-scale developers may face in starting construction quickly, as well as the potential paths forward as the House prepares to vote on the bill. Overall, while the current situation is not ideal, Kaden remains optimistic about the future of solar energy and its role in achieving energy security.