Fwd: Solar tax credit crunch

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When the Trump administration wiped out electric vehicle tax credits earlier this year, the US automakers saw a rush of buyers. With rooftop solar and battery tax credits set to wind down at the end of this month, the same thing is happening again.

But driving a car off the lot is much simpler than getting your home kitted out with solar panels and battery backup. The huge uptick in buyers coupled with an installation bottleneck means some homeowners may miss out on thousands of dollars in incentives.

Today’s newsletter looks at the mad dash for solar and why utilities are creating headaches for installers. Plus, a peek at how the Trump administration views climate change in its new national security plan, particularly when it comes to competition with China.

Did someone forward you this email? You can subscribe to the Green Daily for free climate news six days a week.

The sun sets on tax credits...

By Todd Woody

The big red billboard planted by a solar company alongside a Southern California freeway warns passersby that the “Solar Tax Credit Is Expiring,” beckoning homeowners to install solar panels and batteries before the Trump administration eliminates the generous incentive on Jan. 1.

The deadline has helped drive a big spike in business for solar installers as buyers rush to qualify for the 30% tax credit before it disappears. But California installers said lengthy utility permitting times could imperil customers’ tax credits if their systems aren’t in place by Dec. 31.

“Clients are concerned about potentially missing the tax credit deadline,” Anthony Del Bene, a manager at Berkeley solar installer A1 Sun, said in an email. “We explained that we would do everything possible to meet this timeframe [but] given the delays we’re seeing, I can’t say I feel completely at ease.”

Workers install solar panels in California. Photographer: Sandy Huffaker/Bloomberg

US homeowners already pay more for solar and wait longer for installation than Australians and Europeans due to a byzantine permitting system, which varies from city to city and utility to utility. Now, with the sun setting on the federal tax credit, delays that prevent solar and battery installations until after Dec. 31 could cost homeowners $10,000 more for a typical project.

Emily Walker, director of insights at Boston-based solar marketplace EnergySage, said permitting has been a barrier in the US long before the current solar stampede. “Installers are working around the clock to meet the rush, but most have stopped promising year-end completion due to limited bandwidth and increasingly long and inconsistent permitting timelines,” she said in an email.

A US Internal Revenue Service spokesperson said that to qualify for the tax credit, homeowners need to complete installation of solar and battery systems by Dec. 31. For those installing both, a finished system often must include the attachment of a device called a meter socket adapter to their utility meter to connect solar and battery components without expensive electrical upgrades.

That creates a particular bottleneck in California, the nation’s largest solar market. Nearly 60% of new residential solar installations in the state include batteries compared to 40% nationally, according to the US Energy Information Administration, and utilities typically install the meter socket adapters.

Southern California Edison spokesperson Jeff Monford said the utility has experienced “significant delays” in installing the devices between September and November due to a jump in applications from homeowners as the tax credit deadline approached. The utility is working to “speed up the process, enabling customers to receive their tax credits,” he said.

PG&E spokesperson Mike Gazda said the time to process meter socket adapter applications and install the devices was nine days in October and November, but several installers said they’re experiencing weeks or a month-long delay.

Bill Russell, a manager at solar installer NRG Clean Power in the Los Angeles area, said it’s taking Southern California Edison six to 10 weeks — four times longer than other utilities — to install meter socket adapters, putting customers’ ability to qualify for the 30% tax credit “in serious jeopardy.”

Read the full story to find out which California utility isn’t experiencing a major delay.

...but it also rises

The number of hours of free energy some households will receive in Australia. The nation has some 4 million panels on rooftops, and the free energy is a bid to soak up excess solar generation, reduce power bills and improve grid stability.

Thrifting for panels

"If you’re trying to do it as cheaply as possible, used is 1,000% the way to go."

Sameer Sajid

Software engineer

Sajid is one of a number of people who have turned to eBay and Facebook Marketplace to buy used solar panels. They cost less but can also be less reliable, making them more ideal for projects than powering a home.

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Your weekend listen

In his new book Breakneck, tech analyst Dan Wang argues China’s engineering mindset has given it an edge in all sorts of domains, including climate technologies, while America’s lawyerly mindset is holding it back. This week on Zero, Wang tells Akshat Rathi what the world can learn from China and how the US could start to compete on green tech in the future.

Listen now, and subscribe on Apple, Spotify or YouTube to get new episodes of Zero every Thursday.

Your weekend read

The Trump administration’s AI and energy strategies really do appear to stand in opposition to each other. Renewables are fast and cheap to build, making them a good match for the rapid data center buildout. But the administration has thrown up roadblocks and rolled back tax credits for renewables.

Kyle Stock and Mark Chediak dove into the data and the politics of renewables, data centers and the international AI race. Today’s excerpt explores some of the contradictions and why some experts think that, despite the Trump administration’s rhetoric on renewables, there may be some “concessions” to clean energy.

For more deep dives into how the data center buildout is reshaping the energy industry, please subscribe to Bloomberg News.

The head of one of the biggest renewable energy developers in the US told investors on Nov. 5 that the data center industry still wants clean energy to power its operations.

“Look, that's what can get built in this window," said Andres Gluski, CEO of AES Corp. "There can be talk about nuclear or other technologies; those take years to build. So what is going to meet the majority of the demand? Well, this year it's probably going to be 90% renewables and batteries, and it very likely will be next year as well."

The big tech companies are signing power contracts with natural gas to get round-the-clock power, but say they are still committed to their clean energy goals. As some hyperscalers sign deals to pipe in natural gas directly into their facilities, they are buying contracts for clean power projects that will result in more renewable energy hitting the grid, according to BloombergNEF analyst Nayel Brihi. In the first half of 2025, Meta, Microsoft Corp., Amazon.com Inc. and Google contracted for 9.6 gigawatts of clean energy, or the equivalent of 7.2 million homes, to be delivered to the US over the coming years.

Ultimately, the mismatch between the speed at which companies are building data centers and that at which electricity generation is coming online bodes well for renewable energy. When Trump’s Big Beautiful Bill gutted green energy subsidies, Wood Mackenzie lowered its projection for renewable power plants, but only by 8%. By 2034, the company expects US utilities to add another 666 gigawatts of power from solar, storage and wind, compared with just 126 gigawatts of gas-fired electricity.

Robert Whaley, director of North American power at Wood Mackenzie, doesn’t expect Trump to stop publicly opposing renewable energy. However, away from the microphones, in the thorny weeds of energy policy, he figures conservative policymakers may quietly tolerate a deeper shade of green. Indeed, this year through September, renewable sources comprised 89% of new electrical generating capacity, according to the Energy Information Administration.

“MAGA has to be MAGA; they have to keep the base fired up,” Whaley said. “But privately, I think there will be concessions, because they don’t want to lose the AI race to China.”

Yesterday’s newsletter subject line misstated that former minster of Canadian identity and culture Steven Guilbeault was the first person to resign from Prime Minister Mark Carney’s cabinet. We regret the error.