Benefits of Clean Energy Tax Credits

Investments in clean energy tax credits produce a range of benefits including job growth, household savings, and a reduction in harmful pollutants

  • Clean Energy Tax Credits Deliver Significant Benefits. Investing in solar, wind, batteries, energy efficiency, electric vehicles, and other emerging technologies with tax incentives has a proven record of creating jobs, cutting climate pollution, and reducing energy costs. A 2022 analysis by the Rhodium Group found that the benefits of the clean electricity tax credits are roughly 3-4 times greater than the costs. 
  • Clean Energy Tax Incentives Will Create Jobs. Clean energy tax credits will spur job creation in an industry that has already seen significant growth. In just the power sector, it is estimated that clean electricity tax credits will lead to a net gain of more than 600,000 jobs annually over the next decade. 
  • Clean Energy Tax Credits Reduce Household Energy Costs. A recent analysis from the Rocky Mountain Institute found clean energy tax credits for the power sector could save American electricity consumers $5 billion annually by 2024. An analysis by the Rhodium Group also found that clean energy tax credits would reduce overall household energy costs by an average of $500 a year. 
  • Electric Vehicle Purchase Tax Credits Will Make EVs More Affordable Than Gas Vehicles. Tax credits for electric vehicle purchases will reduce the cost of buying EVs – making the total cost to own an electric vehicle as much as 16% less expensive than the average gas vehicle.
  • Clean Energy Tax Credits Reduce Harmful Air Pollutants And Help Protect Vulnerable Communities. According to the Rhodium Group, 10 years of clean electricity tax credits will reduce sulfur dioxide by up to 84% and nitrous oxides by up to 62% in just five years. Clean energy tax credits, together with a full suite of investments and administrative action, will cut U.S. greenhouse gas emissions to 45-51% below 2005 levels by 2030, and clean energy tax incentives will reduce CO2 emissions on a per ton basis at a cost of roughly $33-$50 per ton. Reductions in these harmful air pollutants will help tackle the climate crisis and will benefit all Americans – particularly communities of color who continue to breathe more hazardous air. 

For more on how clean energy tax credits generate strong economic growth, job creation, and record renewable production, see our fact sheet on the Return on Clean Energy Investments under the 2009 Recovery Act.