RENEWABLE ENERGY TAX CREDIT: EXTENSION PASSED BY CONGRESS SCOTTMADDEN, INC. | 31 A multi-year extension, part of a December 2015 budget deal, provides some certainty. Big Winners: Solar and Wind with Phase-Out Periods • The 30% business investment tax credit (ITC) for solar was extended through 2019; this steps down to 26% in 2020, 22% in 2021, and 10% thereafter. In addition, the “placed in service” requirement was replaced with a more flexible “commence construction” provision • The production tax credit (PTC) was extended for wind, geothermal, landfill gas, and hydro projects commencing construction in 2015 and 2016 • For wind only: 80% of the PTC is available for projects commencing construction in 2017, 60% of PTC in 2018, and 40% of PTC in 2019 • In addition, 50% bonus depreciation was extended for renewable and conventional generation placed in service during 2015, 2016, and 2017; this phases down to 40% in 2018 and 30% in 2019 Actual and Projected Annual Solar and Wind Installations (2011-2021) Actual Projected 25 Annual Installations (GWs) Solar - Residential 20 Solar - Commercial & Industrial Solar - Utility 15 Wind 10 SOLID: Before ITC Extension 5 HATCHED: After ITC Extension 0 2011 2012 2013 2014 2015 2016E 2017E 2018E 2019E 2020E 2021E Source: Bloomberg New Energy Finance