The House at press time was poised to vote on an $18.2-billion package of tax breaks aimed at promoting energy efficiency and renewable power, such as wind and solar. The bill, which has new incentives and extends existing ones that are set to lapse, may well clear the House. Beyond that, however, prospects are cloudy. A key problem is the bill offsets revenue that the incentives cost the Treasury, mainly at the expense of oil companies. That language, and other provisions, drew a Feb. 26 White House veto threat.
|$18-Billion House Tax Bill Includes:|
|Provisions||10-year cost ($ billions)|
|Renewables (includes wind, biomass, geothermal) production credit, three-year extension||6,570|
|Solar-energy investment tax credit, eight-year extension||621|
|Clean Renewable Energy Bonds, for public power companies, power co-ops||640|
|Residential energy-efficiency property credit, six-year extension||634|
|Energy conservation bonds||1,900|
|Energy-efficiency improvements credit, existing homes, two-year extension||1,530|
|Energy-efficiency commercial-buildings deduction, five-year extension||776|
|Five-year depreciation for utilities using “smart meters”||1,520|
|Credits to New York City, New York state for lower Manhattan transportation project spending||1,830|
Source: House Ways and Means Committee
There’s an air of déjà vu about the new bill: The House passed similar provisions in its energy bill last year, but they didn’t make it into the version signed on Dec. 19. Just weeks ago, the Senate Finance Committee had energy-efficiency breaks in its economic stimulus bill, but they weren’t in the measure signed on Feb. 13.
Now, pro-conservation and renewable energy groups are gearing up for another push. “We support the package wholeheartedly,” says Brad Penney, the Alliance to Save Energy’s government relations director. “We’re encouraged to see legislation moving,” adds Gregory Wetstone, American Wind Energy Association senior director for government and public affairs. With the production credit for renewables due to expire on Dec. 31, about $19 billion in wind-energy spending and 116,000 jobs are at risk. “With every passing day, we see impacts on investment in renewable energy grow,” Wetstone says.
Andrew Goldberg, American Institute of Architects’ senior director for federal relations, calls the House bill “a good package.” He notes that it has multiyear extensions. The Senate Finance stimulus bill had one- or two-year extensions. But Goldberg says the new bill’s chances of enactment “are still pretty slim,” because the White House and GOP lawmakers oppose the revenue-raising offsets. He says AIA would like to see the House bill pass with a strong majority but realizes “there may need to be another vehicle for it to get through.” Among possible options are including energy provisions in another stimulus bill or attaching them to a bill to shield millions of Americans from the alternative minimum tax.