The Senate's recent filibuster of the tax extender for the 2009 30% Solar Investment Tax Credit is the latest manic-depressive moment in our industry.

What does this mean if you want to power your World with onsite clean power?  There is little time to waste--we typically need six months from GO to power up--and we only have a little over ten months left before the 30% Solar ITC reverts to a 10% credit.

Why should you care?  Here is the value stack under the present tax law, present California incentives, and present avoided power costs.

Here is what it will look like if you flip the switch after 31DEC08, under present law.

The 25% system value-add drops to 5%.  Still positive, but much harder to justify the investment.  The after tax IRR drops from high teens to below 10%.  Not enough to pull demand for renewables forward five years--to accelerate the job creation and adoption--that the 30% stimulus does. 

And the cost of doing the right thing is about what we burn in two months in Iraq using the President's $186B 2008 Iraq war cost estimate.

The McKinsey report did not acknowledge that a long term distributed generation + renewables federal tax policy is critical to kicking our brown power habit. Think of it as The Patch.  It helps us get where we need to be.

There are a number of institutional investors sitting on the sideline ready to get in the game if there is a multi-year tax policy to pull demand for renewables forward five years--which is exactly what the solar ITC does.  It creates green collar jobs in California and elsewhere, and provides a stable platform for R&D and getting the costs out of distributed PV power.

There are three things you don't wanna do when harvesting your available solar resource.  Number three is procrastinate.