Solar Tax Credit Expirations and Renewals (1985-2013)
The original residential solar credit created in 1978 expired in 1985. Congress recreated it in 2005, then let it expire again in 1990 for a month and in 1992 for four months before renewals. The production tax credit (PTC) for renewables expired and was renewed repeatedly through the 2000s and 2010s, creating chronic uncertainty. Each time, the solar industry contracted during expiration periods, then rebounded when credits were restored. The pattern became: credit set to expire, industry lobbies furiously, Congress extends at the last minute.
Each expiration caused installation declines of 20-40% and industry layoffs.
The on-again, off-again cycle forced solar companies to develop more resilient business models less dependent on subsidies. By 2020, solar costs had dropped 90% from 2005 levels, making the industry less reliant on tax support.
The current expiration fits a four-decade pattern of boom-bust subsidy cycles. Unlike previous expirations, though, this one was accelerated seven years ahead of schedule rather than simply letting the credit sunset as planned.