The solar power industry is growing fast, accounting for more than half of all new electricity on the grid last year. But soon President-elect Trump and fellow Republicans in Congress may try to reduce or eliminate government incentives that have driven much of that growth.
That has potential customers who want to install solar on their homes worried about the future of an existing 30% federal tax credit. Some are responding by rushing to install solar now, before the credit can be eliminated. Others are deciding solar is too risky with an incoming Trump administration.
Solar installers face even more uncertainty with threats of increased tariffs that could make panels and other equipment more expensive. The industry's main trade group, Solar Energy Industries Association, has released a policy agenda that echoes some of Donald Trump's language, such as "energy dominance." But it's not clear that will sway a president who has been openly hostile to renewable energy.
Trump has suggested tariffs as high as 60% on imports from China and 20% on all other goods coming into the U.S. With the support of a Republican-controlled Congress, Trump also could rescind programs passed as part of President Biden's climate agenda, where allocated money has not already been spent.
Solar customers respond to uncertainty
Jorge Solares says he decided last summer to install solar panels on his house in the Boston suburbs. He was motivated by environmental concerns: solar power doesn't emit the climate-heating greenhouse gases that fossil fuels do. Saving money also was a motivation.
"We have a brand new baby, and we're hoping to make that investment, so at some point we won't have to pay [for] electricity and focus on her spending." Solares says with a chuckle. The panels will reduce his electricity bill and, he says, pay for themselves in five or six years. After that, his electricity will be mostly free.
That plan seemed like a solid one, until Trump won the November election.
"Looking ahead, I just don't know what to expect from the next administration," Solares says.
On the campaign trail last year, Trump vowed to boost oil and gas production, even though the U.S. already produces more oil than any country in history. At a speech to the Economic Club of New York in September, Trump said he would "rescind all unspent funds under the misnamed Inflation Reduction Act" – that's the Biden administration's climate-focused law, passed in 2022.
It's not clear what Trump's comments mean for clean energy tax credits. His transition office didn't respond to NPR's questions. But the future of these credits is a significant issue for homeowners who want to install solar panels. The 30% tax credit saved Solares about $8,000.
"Since we're spending so much money on this, the federal credit was just the way for us to get it [solar]," Solares says, "Otherwise it's just too expensive."
It took months for inspections, permits and installing the panels on Solares' house. Given the tax credit's uncertain future, he pushed his installer to get the panels operating before the end of 2024 to ensure he can claim the credit on last year's taxes.
Near Jacksonville, Florida, Jeff Beardsley says the uncertainty led him to a different conclusion.
"A big part of me wanted to lean towards solar," Beardsley says. He deliberated between installing solar panels plus batteries or a gas generator to keep the power on in his house after a hurricane.
Solar power is more climate-friendly than a fossil fuel generator, which releases climate-warming greenhouse gasses.
"I certainly liked being able to generate my own power from the sun… You know, that's kind of cool, from a sustainability perspective," Beardsley says. But he couldn't get the solar project operating by the end of the year and potentially losing the 30% tax credit, so he concluded the gas generator was the better option.
Solar companies face even more uncertainty
Companies that install solar panels say doubts about the tax credit's future, and other actions Trump may take after January 20th, are affecting their business. Some installers say they are drafting multiple business plans hoping one will help them respond.
One installer in the Philadelphia suburbs decided to stock up on solar panels now.
"As you can see, we are packed to the gills here," says Doug Edwards, president of Exact Solar as he walks through his company's warehouse in Newtown, Pennsylvania. The space is filled with pallets of boxed solar panels waiting for installation.
Edwards stocked up because of another uncertainty. Trump campaigned on putting 20% tariffs on all goods coming into the U.S.
If that happens quickly – say, in the months between when a job is bid and when it's finished – that could make a solar project unprofitable. By stocking up, Edwards locked in panel prices, protecting both his business and his customers' wallets.
Also in his warehouse there's black metal "racking" for mounting panels on a roof. Some of it is made in the U.S., so it qualifies for higher federal tax credits. Those credits also could be at risk if Trump and Republicans pursue an extensive overhaul of the Inflation Reduction Act.
Edwards says he's hired new workers based on the assumption that such incentives would be around for a decade.
"We've almost tripled in size in the last few years – all local hiring, all local team members," Edwards says, "And we're just hopeful that we won't have to slow that down or have that disrupted in a major way."
While Edwards remains positive about the future of the solar industry, there is a lot of concern that incentive changes and increased tariffs could lead to job losses, or that companies will hire fewer new workers than expected.
Stephen Irvin with Amicus Solar Cooperative says when his more than 80 member companies have to pay higher panel prices, "that means that maybe now they can't hire that extra person they were hoping to. That's a job loss right there."
And Irvin says it's a mistake to see the solar industry as more aligned with Democrats.
"Our companies, and our membership, are spread evenly across red and blue [congressional] districts," Irvin says. "Solar is not just a Democratic issue. It's an American issue."
The solar industry hopes President-elect Trump and Republicans in Congress will come to see it that way too. And leave subsidies in place that encourage more homeowners to install solar power.
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