There was no shortage of bills and issues that could have potentially impacted the solar industry. USEA had a full-time presence on the hill during the session and was supported by many of our members, member lobbyists and solar customers. Here is a recap of some of the more important bills we worked on.
Solar Tax Credit:
USEA negotiated a deal for the phase out of the residential tax credit which, given some hefty political headwinds, is a much better solution for our industry than what was originally proposed in HB 23 by Representative Peterson. Please keep in mind that we had already ensured that the commercial tax credit remains untouched.
To provide some perspective, here are some of the reasons we felt a good compromise was better than trying to kill this bill outright:
There was (and will be again in 2017/’18) serious attention being paid to all tax credits and sources of revenue. Two reasons for the political pressure to find more revenue:
- There is an effort to put a 7/8 of a percent income tax increase on the ballot in 2017 that would seek to raise about $700 million for education. Legislators do not like this effort and are therefore looking for money to push toward education.
- Utah expected to see a smaller budget surplus than the last few years, which put a strain on budgets.
The original bill passed out of the 2016 interim committee, despite some unease from members. The Legislature wanted to see a compromise and voted the original out of committee as a push for us to work out something better.
Here is a summary of the original HB 23:
- Created a moratorium when the governor signed the bill- spring 2017 (no further credits will be issued for 2017)
- Set a cap on total credits available:
- 2018: $4 million
- 2019: $3 million
- 2020: $2 million
- 2021: $1 million
- Tax Credit Maximum was lowered annually:
- 2017: $2,000
- 2018: $1,500
- 2019: $1,000
- 2020: $500
- 2021: $250
New, USEA negotiated version (HB 23):
- No moratorium for 2017. The credit will remain exactly as is for 2017.
- There is no cap on this, nor will there be.
- The credit will be phased out beginning in 2018 as follows:
- 2018: $1,600
- 2019: $1,200
- 2020: $800
- 2021: $400
The credit in the passed version of the bil, remains fully in tact for 2017 and is only lessened by 2018- but most importantly, there is no cap on the credit so as many customers that want the credit will get the credit.
By accepting this compromise, we garnered some important goodwill and be seen as a reasonable industry. We utilized the good will to help pass our HOA bill, SB 154.
HOA Bill, SB 154 Solar Access Amendments:
Gives HOA residents greater access to installing solar panels on their home. Many HOA residents faced unreasonable barriers to investing in solar energy but SB 154, a well-crafted compromise bill, alleviates many existing barriers and ensures Utahns who want to install solar can do so in a fair manner.
Important aspects of SB 154:
- Limits the amount of restrictions an HOA can place on a solar installation
- Allows more Utahns to be more socially and environmentally responsible
- Provides HOA residents the ability to save money on their utility bills
- Improves air quality
The Vivint Solar team deserves the credit for the heavy lifting on this bill, which they worked on for well over a year. The bill passed both the Senate and the House and was signed by Governor Herbert. Read our Bill Summary Here or Read the bill, SB 154
SB 273, Energy Development Amendments:
One of our higher priority bills this session was SB 273- Energy Development Amendments that sought to clean up C-PACE legislation to help more commercial solar projects advance under the already existing C-PACE legislation passed a few years ago (only 1 C-PACE project has been completed to date). USEA learned of language that Rocky Mountain Power had asked be inserted into the bill as an amendment that would have killed any CPACE projects over 2MW but also possibly impacted all solar/renewable energy projects going forward had their language been codified. We helped rally a group of 14 groups to oppose the language and worked out a compromise that suited all parties.
Here is a quick summary of the bills that were solar related:
HB 23 – Tax Credit, Negotiated to a much preferred phased out.
SB 154 – Solar Access (HOA), Passed
SB 273 – C-Pace Clean Up, Passed
HB 45 – Property Tax Amendments- Defeated, (dealt with utility scale solar)
HB 11 – Boards & Commissions, Passed- our one truly negative outcome but was vetoed by Governor Herbert
HB 297 – Renewable Energy Amendments, Passed- troubling language for solar was removed. USEA neutral on the actual bill
HB 423 – Utility Tariffs, Tabled (did not move forward)- this bill would have impacted utility scale.
Final Thoughts on the Session: I would like to thank all that helped advance solar priorities during the session. It was great to see a team of people working together for a successful industry session. Furthermore, our one priority action alert, regarding SB 154, resulted in 261 people sending 360 emails to legislators expressing support for the bill. That is an impressive number for our first industry action alert- thank you.