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Previously, the ITC for solar energy was set to reduce to 10% after December 31, 2016.
The credit is now extended through the end of 2019 at the 30% level, and will step down to 26% in 2020, 22% in 2021, and 10% in 2022 and future years.
The idea is that as solar costs continue to drop and project economics remain buoyed by the ITC, the case is stronger for utilities to claim losses and expenses as a result of increasing solar adoption.
But typical residential consumers, who by-and-large aren’t home in the middle of the day, have relatively small home loads at these times.
That’s just over 2.5 cents per k Wh of excess generation.
What this amounts to is that solar energy producers will not be credited for excess generation during the day in the way they’ve historically been used to, making pay-back periods much longer and threatening economic viability of many projects altogether.
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The related issues behind this vote were decidedly a bit more complex than in Nevada due to the uniquely high solar penetration Hawaii is experiencing (as of October 2015, roughly 16% of HECO Companies customers were generating power with grid-connected solar the capacity of which amounted to about 35% penetration on the system peaks.