Just how utterly dependent is the solar industry on government cronyism?

The Asheville Citizen-Times pulls back the curtain on the patient that’s been hooked up to life support apparently for 38 years (i.e., “a solar tax incentive has existed in the state since 1977”):

The N.C. Senate in its budget proposal has eliminated solar tax credits, which for years have helped make North Carolina a leader in solar energy use. The state House includes a provision that would extend the credits for another two years. …

[I]f the tax credits disappeared, “I wouldn’t be surprised if a number of solar companies just closed up shop,” said Dave Rogers, state director of Environment North Carolina, a Raleigh-based nonprofit organization.”There would be a drop in the number of installations, which would mean less solar coming onto the (power) grid,” Rogers said.

“Layoffs — of sales people, site developers, installation crews — would follow pretty quickly.”

The paper tries the old reliable super-industry followup:

The Pew Charitable Trusts, using 2013 data, reported in an October study that North Carolina was No. 3 in the country in both new capacity and private investment, which was measured at $1.2 billion.

That same paper found the state placed fourth in total capacity and fifth in solar-powered homes. North Carolina came in 10th with 3,100 solar industry jobs, according to the Philadelphia-based nonprofit public policy organization.

Recall that that same report by Pew found that when just the federal tax credit for solar investment expires, annual solar investment here will fall by 75 percent. Again, that’s only counting the effect of the federal investment tax credit expiring.

An energy economist was blunt in his assessment:

One economist who has analyzed solar tax credits said it’s simple to understand why some lawmakers take a dim view of the subsidies.

“I’m not aware of one solar project that has had a positive impact on a state budget,” said Loren Scott, an economist based in Baton Rouge, Louisiana. He is professor emeritus of economics at Louisiana State University, where he served on the faculty for three decades.

“There’s no place the solar industry is making it on its own,” said Scott, who also runs an economic consulting firm. “If you take away its subsidy and tax credit, it can’t make money and it’ll go away.”

Scott predicted that North Carolina’s solar sector would vanish if the General Assembly eliminated the tax credit.

Here, again, is how the state (35%) and federal (30%) investment tax credits and accelerated state (5%) and federal (30%) depreciation schedules, in the words of the N.C. Dept. of Environment and Natural Resources:

return almost all of their investment within six years.

NCDENR solar tax incentives
Source: N.C. Dept. of Environment and Natural Resources

Jon Sanders / Director of Regulatory Studies

Jon Sanders studies regulatory policy, a veritable kudzu of invasive government and unintended consequences. As director of regulatory studies at the John Locke Foundation, Jo...

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