The Environmental and Energy Study Institute sponsored a Congressional briefing to examine clean energy tax incentives being considered by the Senate Finance Committee. The committee is scheduled to mark-up energy tax legislation during the first week of February in preparation of the Senate debate on energy legislation presently scheduled for mid-February. The briefing covered incentives for renewable energy, energy efficiency, and vehicle technologies, as well as a federal System Benefits Fund. The briefing also examined the issue of subsidies with a comparison of incentives for fossil fuels, nuclear power, and energy efficiency and renewable energy technologies.

The renewable energy and energy efficiency industries, along with other clean energy advocates, argue that investments in clean energy technologies are necessary to create a more level playing field, and will also yield important public benefits including economic development, job growth, energy security, environmental protection and greenhouse gas emission reductions. Poll after poll has shown public support for energy efficiency and renewable energy technologies. Clean energy tax incentives are viewed by many as a critical aspect to ensuring that Americans have clean energy choices. The panel of experts, who discussed the various provisions before the Senate Finance Committee, included:

The production tax credit (PTC) for wind, closed-loop biomass and poultry litter expired December 31, 2001 without being extended by Congress. Various proposals have been introduced to extend the PTC, as well as to expand the credit to include solar power, open-loop biomass, animal waste, landfill gas, geothermal, incremental geothermal, and incremental hydropower facilities. Tradable tax credits, which allow public power to participate in a renewable energy production tax incentive, have also been proposed. In addition to PTC proposals, a residential solar tax incentive has been introduced, which would provide incentives for consumers to install solar power systems on their homes.

The energy efficiency proposals being considered by the Senate Finance Committee encompass a range of technologies, such as new and existing residential and commercial buildings, appliances, combined heat and power, fuel cells, and vehicles powered by fuel cell, battery electric, and hybrid technologies, as well as other alternative fuels. A federal System Benefits Fund (SBF), which is also being considered, would be supported by a small wires charge (small fee per kilowatt hour of electricity) to consumers and would invest those funds to help implement renewable energy and energy efficiency technologies and low-income energy assistance programs.

For more information, please contact Beth Bleil of EESI at 202-662-1885 or bbleil@eesi.org.