New Study Shows Significant Job Growth in 2012 from One-Year Extension of Successful Treasury Program
Study by EuPD Research finds extension of cost-effective 1603 Treasury Program will create more than 37,000 American jobs next year driven by solar market growth.
WASHINGTON, DC – Today, the Solar Energy Industries Association (SEIA) released "Economic Impact of Extending the Section 1603 Treasury Program," a report by renowned global energy analysis firm EuPD Research. The report examines projected job growth and solar deployment associated with a one-year extension of the Section 1603 Treasury Program.
According to the report, a one-year extension would result in the solar industry supporting an additional 37,394 jobs in 2012. In addition, a one-year extension would result in nearly 2,000 additional megawatts (MW) of solar installations above baseline by 2016, enough to power 400,000 homes. The report also analyzed scenarios for two and five-year extensions of the program.
"More than 100,000 Americans work in the solar industry, double the number in 2009. Solar is a proven job creator at a time when the unemployment rate for the country remains stubbornly high," said Rhone Resch, president and CEO of SEIA. "The 1603 Treasury Program has been the single most effective policy driving renewable energy growth during the past two years."
The program was created in 2009 in the wake of the financial crisis, which drastically reduced the availability of tax equity financing for energy projects. The Section 1603 Treasury Program allows energy developers to receive a federal grant in lieu of claiming an existing energy tax credit. The program does not create any new incentives, but instead simply accelerates the timing of the existing credit. This solution was designed to provide the liquidity needed for the further development of domestic energy projects during difficult financial times.
The state of financial markets and the availability of tax equity are still woefully inadequate to meet demand for renewable energy projects. The program, set to expire on Dec. 31, 2011, was intended to outlast the stagnant markets, which have proven more resilient than anticipated.
"At a time when President Obama and Congress are looking for solutions for America's jobs crisis, it would be unconscionable to allow this proven job-creating program to expire," Resch added. "Killing the 1603 Program amounts to a tax increase on the thousands of small businesses that are creating jobs in solar. The bottom line is that our capital markets are still in trouble and this program is needed today as much as it was when it was created. Allowing it to lapse would kill jobs and severely restrict the market's ability to leverage private sector capital to finance new domestic energy projects. Congress must extend the 1603 program to help the American economy."
Key Points of a one-year extension of the 1603 Treasury Program:
• An additional 37,000 jobs would be supported by the solar energy industry in 2012, a 12 percent increase over baseline.
o 18,000 will be directly employed by solar companies or indirectly employed by firms that support the solar industry.
o An additional 19,000 jobs would be induced by the industry's economic activity.
• The additional cumulative capacity installed (2012-2016) would be about 2,000 megawatts over baseline, enough to power 400,000 homes.
o 500 additional megawatts above baseline would be installed in 2012, enough to power about 100,000 homes.
Established in 1974, the Solar Energy Industries Association is the national trade association of the U.S. solar energy industry. Through advocacy and education, SEIA and its 1,000 member companies are building a strong solar industry to power America. As the voice of the industry, SEIA works to make solar a mainstream and significant energy source by expanding markets, removing market barriers, strengthening the industry and educating the public on the benefits of solar energy. www.seia.org