Solar energy tax credits available since 2012 to Iowa homeowners hoping to install solar panels were allowed to sunset in 2021, disappointing both interested homeowners and the solar industry, but they could be back on the table this year.

The Iowa Solar Energy System Tax Credit equaled 50% of federal solar tax credits. In 2021, those federal credits were for 22% of total installation costs. So, the state’s match was for an additional 11%.

The Iowa credits were set to be available only until the end of 2021. During the 2021 legislative session, Iowa Rep. Chuck Isenhart, D-Dubuque, introduced legislation that would have extended the program in Iowa and increased the annual amount paid into it, due to there being more applicants than funds for several years previously.

“It has not been a partisan issue in the past because people all over the state are trying to take these climate friendly measures or just want to save money on their electricity bill,” he said.

But, the credits were allowed to lapse in the 2021 session.

Iowa Rep. Lee Hein, R-Monticello, chairs the House Ways and Means Committee and said one of the points of contention against extending the credit last session was its connection to the federal credit, which was itself being phased out.

“The federal tax credit we had our language attached to expired,” he said.

That left hundreds of people on a waiting list for the credits. Those people recently began receiving letters saying that their applications would not be approved.

“Right now, you have a lot of people who qualified sucking eggs,” Isenhart said. “There’s really two issues — making whole the people who in good faith applied and then extending the program.”

The Iowa credits had been applied to a great number of installations in the area over nine years. According to Iowa Department of Revenue records, between 401 and 600 projects received the credit in Dubuque County. From 101 to 200 projects received the credit in both Clayton and Jones counties. From 51 to 100 projects got the credit in Delaware County. From 16 to 50 received it in Jackson County.

“A tax credit development is designed for people to spend money and create jobs,” said Larry Steffen, co-owner of Eagle Point Solar, based in Dubuque. “This has been one of the most successful — to the point where the allocation, on an annual basis, wasn’t enough to cover the demand for that. There are nearly 1,000 jobs in Iowa dedicated to solar installation now. We grew from a small number to more than 90 people, due in large part to this program, based mostly in Iowa.”

Hein acknowledged the people left hanging on the waiting list last year.

“There is a group of people who have applied in the last year who didn’t get their credit because there was a cap we put on there, so there wasn’t any money,” he said. “The question I think needs to be made is, ‘Do we want to fund those who have been on the waiting list or do we cut it right now?’ There will be a discussion about whether we fund the people who are signed up for the tax credit now or if we will extend the whole program.”