The renewable energy tax credits Congress extended in December will lead to higher deployment of wind and solar power and reduce emissions from the energy sector, federal researchers announced on Monday.
The tax credit extensions will lead to a net peak increase of 48 to 53 gigawatts of renewable energy generation by the early 2020s, according to a study from the National Renewable Energy Laboratory (NREL). The credits mean renewable energy will be deployed at a noticeably higher rate than if lawmakers allowed them to expire, the report found.
Both figures — renewable energy deployment and carbon emission reductions — are contingent on the price of natural gas. If prices remain at their current low levels, NREL projects, utilities are likely to move more slowly to embrace wind and solar power.
Either way, the report found, “these findings suggest that tax credit extensions can have a measurable impact on future renewable energy deployment and electric sector carbon dioxide emissions under a range of natural gas price assumptions.”
Lawmakers extended the tax credits for solar and wind power for five years as part of the tax and spending deal they reached in December. Extending the credits was a trade-off for lifting the federal ban on crude oil exports.
The credits — and the increased renewable energy that could come from them — are a point of pride for the White House, and have become especially important for President Obama’s climate agenda following the Supreme Court’s temporary halting of the Clean Power Plan on Feb. 9.
“We need to be investing in the future, not in the past,” Obama said at a fundraiser earlier this month.
“Instead of subsidizing, to the tune of several billion dollars a year, the oil industry, we need to be making sure that we continue to make enormous progress in solar and in wind, and in battery technologies, and all the things that promise a capacity for us to generate enormous power without destroying the planet for our kids and our grandkids.”
The White House hailed the study on Monday.
“The bipartisan deal for long-term extensions of these tax credits is one of the biggest investments in clean energy in our country’s history,” said Dan Utech, Obama deputy assistant for energy and climate change.
—This post was upated at 3:20 p.m.