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Will Wachovia deal dim Wells Fargo’s solar investment?

Wells Fargo is touting its investment in solar electricity this week, noting that it’s financed 43 megawatts worth of commercial projects since fall 2007. But will the tax benefits from its Wachovia merger mean less need for solar tax credits?

Wells Fargo is touting its investment in solar electricity this week, noting in a press release that it’s financed 43 megawatts worth of commercial projects since fall 2007. That’s enough to power about 6,000 homes.

“Despite the economic downturn, Wells Fargo continues to invest in solar projects across the country,” the bank’s environmental finance director, Barry Neal, said. “We look forward to helping the industry expand even further.”

But there’s reason to believe its financing of commercial solar projects may dim some in the months ahead.

Most solar incentives in this country come in the form of tax credits. They’re worthless to you and me, but potentially valuable to large companies with profits they’d like to shelter from taxes.

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Large financial institutions such as Wells Fargo, Lehman Brothers and Morgan Stanley have been among the most active financiers for solar and wind developments. However, with far fewer profits to shelter at many banks, the tax credits will be less attractive, the Washington Post reported earlier this year.

Wells Fargo, while healthier than other banks, might have less need for solar tax credits because it already won a huge tax shelter from its acquisition of the distressed Wachovia Corp., the Post notes.