Donald Morris & Pingjing Qiao (both of the University of Illinois), Promoting Energy Savings With State Income Tax Incentives for Homeowners, 63 State Tax Notes 37 (Jan. 3, 2012):

Our discussion of state income tax credits and deductions as incentives for residential alternative energy and energy conservation investments, including our brief review of the literature, reveals three concerns for which the data and explanations in this paper provide some guidance. The first relates to the inability of governments to track the benefits of tax incentives, including energy income tax credits and deductions. … A second concern noted earlier is that the benefits of energy incentives may go to those who would have invested in the alternative energy or energy savings products without the credit or deduction. … A third consideration referred to earlier and related to the second — but with a subtly different emphasis — suggests that the benefits of tax credits and deductions go primarily to higher-income taxpayers.

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