{"id":11823,"date":"2024-11-12T20:14:43","date_gmt":"2024-11-12T20:14:43","guid":{"rendered":"https:\/\/www.solar.com\/learn\/?p=11823"},"modified":"2024-11-14T17:36:09","modified_gmt":"2024-11-14T17:36:09","slug":"what-does-second-trump-presidency-mean-for-rooftop-solar","status":"publish","type":"post","link":"https:\/\/www.solar.com\/learn\/what-does-second-trump-presidency-mean-for-rooftop-solar\/","title":{"rendered":"What Does a Second Trump Presidency Mean For Rooftop Solar?"},"content":{"rendered":"

On November 5, America elected Donald Trump as the 47th President of the United States. Perhaps more importantly for shaping policy, the GOP now controls the Senate and, as of writing this article, appears to\u00a0also control the House. This means the GOP will have a relatively unimpeded path to implement policy to support their vision of America.<\/p>\n

What does this mean for the solar industry? A lot is unknown. There is conflict between public statements and published policy objectives, as well as some interparty disagreement about how to handle policy that supports renewables.<\/p>\n

How political is solar actually?<\/strong><\/h2>\n

While solar is often seen as a deeply partisan issue, there are several examples of lawmakers \u2014 even Trump himself \u2014 breaking from traditional party lines to help or hurt the solar industry.<\/p>\n

The Federal Investment Tax Credit (ITC) is a 30% tax credit<\/a> against eligible costs of solar installations and the largest single economic enabler for the residential solar industry as it reduces costs for homeowners. The ITC was originally passed as federal policy in 2005 and has been renewed several times since then. During his first term, Donald Trump actually extended the ITC for a year<\/em> as part of a tax extenders package at the end of 2020 when the nation was dealing with COVID.<\/p>\n

On a State level, we\u2019ve seen negative net metering policies take effect in blue California while red Florida extended their current version of net metering in a huge win for rooftop solar. While these policy changes were enacted for two entirely different reasons in two very different markets, it\u2019s important to contextualize that solar shouldn\u2019t simply be painted with a broad brush as being supported by liberal policies in liberal areas.<\/em> At its core solar is an enabler of conservative ideals such as self-sufficiency, market choice, and domestic sourcing<\/p>\n

Weighing policy change risks for solar <\/strong><\/h2>\n

Although there have been several public comments about repealing the Inflation Reduction Act (IRA)<\/a> in its entirety (the IRA was the sweeping policy passed in 2022 that preserved and extended the ITC), which would include the elimination of the ITC, the assumed reality is the GOP will take a scalpel to the policy and cut out parts it doesn\u2019t like.<\/p>\n

The ITC will likely be preserved through at least 2025 \u2014 although it may start to step down prior to its current 2030 date. There will, however, be tax code changes. So even if the tax credit remains the efficiency and ability to monetize it may become more challenging.<\/p>\n

Trump is a big proponent of tariffs so it\u2019s highly likely the cost of components required to install solar will go up. Although there have been significant efforts in reshoring manufacturing since the passage of the IRA, a lot of sub-components are still imported which will raise costs incrementally. And, with the precarious nature of IRA policy it’s not likely we\u2019ll see new investments until there\u2019s policy certainty.<\/p>\n

So, is now a good time to go solar?<\/strong><\/h2>\n

If you\u2019ve been on the fence about going solar, today is unquestionably a great day to move forward with the project<\/strong>. Interest rates are .75 basis points lower than their high and, given presumed upcoming tax and policy changes, the Fed may hold off on interest rate drops for some time.<\/p>\n

The ITC is here and can be monetized. It\u2019s a sure thing that will not be getting more valuable over the next four years.<\/p>\n

Component and installation costs are at an all-time low. Those will undoubtedly start increasing rapidly as companies pay tariffs or lose manufacturing subsidies.<\/p>\n

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What should I consider about going solar today vs pre-election?<\/strong><\/h2>\n

The recommendations for homeowners remain unchanged:<\/p>\n