Answer
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Government incentives have been instrumental in driving solar energy adoption by enhancing the financial viability of solar projects. In the U.S., the Modified Accelerated Cost Recovery System (MACRS) allows solar investors to depreciate solar assets over five years, providing substantial tax benefits. Combined with the Investment Tax Credit (ITC), which can offset installation costs, businesses can recoup nearly 50% of their solar investment over a five-year period.
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In India, the adoption of accelerated depreciation, currently set at 40%, is expected to have a similar impact. This policy reduces taxable income and shortens the payback period, making solar investments more appealing for businesses.
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