In this time of soaring energy demand and ever-rising utility bills, small clean energy projects are too often dismissed. Wall Street has been quick to turn to gas turbines that can produce hundreds of megawatts of power from one site at the expense of public health and the environment, or large-scale solar projects that produce low-cost clean energy, but with land use implications.

To the extent that just one of these “utility-scale” facilities can produce enough electricity to power a small city, turning to smaller projects to solve our energy crisis could seem ineffectual. On this point, looks are deceiving. Those small projects account for at least 20% of all solar installed in the United States.

Small, community-scale clean energy projects have a number of advantages that are overlooked, even by some clean energy advocates. These projects can immediately reduce electricity bills, provide backup power when paired with a battery energy storage system, and reduce dependence on coal and gas whose pollution causes heart and lung diseases and contributes to climate change. Importantly, these projects come with local support in many cases, and small-scale solar developers are rarely exposed to the kinds of permitting delays that a utility-scale solar project may face.  

However, instead of doubling down on small-scale projects, the Trump administration and Republicans in Congress have taken pains to cripple these efforts. The One Big Beautiful Bill ended the longstanding tax credit for residential solar and created new barriers for existing solar and storage credits. The Environmental Protection Agency also terminated the Solar for All program that would have reduced electricity bills by more than 20% for a million Americans, though a federal judge this month vacated the EPA’s decision.

Congress should reverse course. If lawmakers revisit the wind and solar tax credits, they should preserve incentives for distributed community-scale projects, even if they conclude that some utility-scale projects no longer require the same federal support.

The price of solar power has dropped over 80% in the past 20 years. That remarkable achievement means that many projects — especially those utility-scale projects — can quickly generate a profit and may not need financial support. However, the calculus is completely different for local projects at houses of worship, health clinics, community centers, schools and local government buildings, where profit generation is not the main goal. 

Communities are shaping local projects to fit their needs. Low-cost electric power is one benefit, but equally important is the capacity for backup power during outages, rendering solar-plus-storage projects particularly attractive to many communities. Homes and businesses using onsite clean energy enjoy lower air pollution and are better shielded against fossil fuel price volatility. 

In San Fernando, California, for example, federal tax credits from the Biden administration’s Inflation Reduction Act helped a local clinic install solar panels and a battery backup at their facility. The system provides 60% of the clinic’s energy, saving on utility bills. Similarly, hundreds of local clinics across the country are pursuing such projects.

The IRA’s clean energy tax credits, along with the elective pay mechanism — which allows tax-exempt entities such as houses of worship and community clinics to benefit from those credits — have been game changers for advancing these types of local projects. While the private sector has benefited from energy tax credits for decades, elective pay has leveled the playing field for state and local governments and nonprofits.

Congress should preserve elective pay and undo the early phaseouts for community-scale solar and storage projects. Encouraging these types of clean, local projects is also a good way to meet growing power needs without railroading local communities. These projects do not sacrifice or minimize community engagement; rather, they expand and deepen support for clean energy, creating a firm foundation for lasting change. 

Regardless of who controls Congress next year, the need for affordable, low-carbon energy will continue to grow. Speedy deployment of utility-scale clean power should be part of the solution. But alone it will not deliver the resilient, cost-saving energy Americans need.

When Congress revisits clean-energy tax policy, lawmakers should restore incentives for locally driven solar and storage projects and preserve elective pay so communities and local governments can use them to increase energy resilience. Mature utility-scale technologies may require less government support, but that is not an argument for abandoning the incentives that make clean and resilient energy affordable for everyone else.