The World's #1 Renewable Energy Network for News, Information, and Companies.

Update: President Obama Signs Stimulus Package into Law

On Friday, the both the U.S. House of Representatives and Senate voted 246-183 and 60-38 respectively to pass the final version of the American Recovery and Reinvestment Act. President Obama has now signed the bill into law. The congressional vote was along party lines as no Republican House members voted for the measure and seven Democrats also voted no. As RenewableEnergyWorld.com has been reporting for the last two weeks, the bill includes a host of provisions that will greatly benefit the renewable energy industry.

The first sections of the bill extend the production tax credit (PTC) and offer the ability for developers to take the investment tax credit (ITC) in lieu of the PTC. The industry will also get what it has been advocating for since January — monetization of the tax credits in the form of grants.

The bill would extend the placed-in-service date for wind facilities for three years (through December 31, 2012), and would also extend the placed-in-service date for three years (through December 31, 2013) for closed-loop biomass, open-loop biomass, geothermal, small irrigation, hydropower, landfill gas, waste-to-energy, and marine renewable facilities at a total cost of US $13.143 billion over 10 years.     

Because of current market conditions, it is difficult for many project developers to find financing due to the uncertain future tax positions of potential investors in these projects. The bill would allow facilities to elect to claim the investment tax credit in lieu of the production tax credit. This proposal is estimated to cost US $285 million over 10 years.

Current economic conditions have severely undermined the effectiveness of both the PTC and ITC, so the bill would allow taxpayers to receive a grant from the Treasury Department in lieu of tax credits. This grant will operate like the current-law investment tax credit. The Treasury Department will issue a grant in an amount equal to thirty percent (30%) of the cost of the renewable energy facility within sixty days of the facility being placed in service or, if later, within sixty days of receiving an application for such grant. An applicant will qualify for a grant if an application is received by September 30, 2011. The amount of money that will be made available for this program is still unknown.

In addition to those measures, manufacturers in the wind, solar, storage, efficiency and transmission spaces will be able to take advantage of a new 30% tax credit designed to benefit manufacturers of advanced energy property. Credits are available only for projects certified by the Secretary of Treasury, in consultation with the Secretary of Energy, through a competitive bidding process. The Secretary of Treasury must establish a certification program no later than 180 days after date of enactment, and may allocate up to $2.3 billion in credits. This proposal is estimated to cost $1.647 billion over 10 years.

Caps on the tax credits for residential solar hot water, geothermal heat and small wind systems will be removed under the new bill as well. Under current law, businesses are allowed to claim a 30% tax credit for qualified small wind energy property capped at $4,000. Individuals are allowed to claim a 30% tax credit for qualified solar water heating property capped at $2,000; qualified small wind energy property, capped at $500 per kilowatt of capacity, up to $4,000; and qualified geothermal heat pumps capped at $2,000. This proposal is estimated to cost $872 million over 10 years.     

The bill authorizes an additional $1.6 billion of new clean renewable energy bonds to finance facilities that generate electricity from the following resources: Wind, closed-loop biomass, open-loop biomass, geothermal, small irrigation, hydropower, landfill gas, marine renewables and trash combustion facilities. This proposal is estimated to cost $578 million over 10 years. There is also a provision to authorize an addition $2.4 billion of qualified energy conservation bonds to finance state, municipal and tribal government programs. This proposal is estimated to cost $803 million over 10 years.    

The alternative refueling property credit that provides a tax credit to businesses that install alternative fuel pumps, such as fuel pumps that dispense E85 fuel, electricity, hydrogen, and natural gas will be extended. For 2009 and 2010, the bill would increase the 30% alternative refueling property credit to 50%, and cap it at $50,000. The cap for hydrogen refueling pumps will be increased to $200,000. This proposal is estimated to cost $54 million over 10 years.    

The bill would extend the tax credits for improvements to energy-efficient existing homes through 2010. This tax credit is capped at $50 for any advanced main air circulating fan, $150 for any qualified natural gas, propane, oil furnace or hot water boiler, and $300 for any item of energy-efficient building property.

Finally, the bill modifies and increases a tax credit passed into law at the end of last Congress for each qualified plug-in electric drive vehicle placed in service during the taxable year. The base amount of the credit is $2,500.

Check back with RenewableEnergyWorld.com for industry reaction and analysis to the passage of the bill and the renewable energy provisions.

RELATED ARTICLES

First Anniversary of The Balkan Floods Highlights Renewable Energy Market Opportunities

Ilias Tsagas, Contributor One year ago this month, severe flooding in Serbia, Bosnia-Herzegovina and Croatia killed 79 people, displaced about half a million and caused economic paralysis of the region. In the wake of these the catastrophic events, ...
Canadian Climate Goals

Canada Announces Weak Climate Target

Danielle Droitsch, NRDC Last week, Canada has announced its contribution to the global effort to reduce greenhouse gases by announcing its post-2020 target. The target announced today is off-track to the 80 percent cut by 2050 they committed to in...
Renewable Energy Stocks

What Drives Alternative Energy Stocks?

Harris Roen, The Roen Financial Report Alternative energy became a serious market player after the turn of the millennium. Since that time, solar, wind, smart grid and other alternative energy stocks have experienced both strong up and down trends. The forces at...
Rooftop Solar Panels

Hypocrisy? While Buffett Champions Renewables, His Company Fights Rooftop Solar

Mark Chediak, Noah Buhayar and Margaret Newkirk, Bloomberg Warren Buffett highlights how his Berkshire Hathaway Inc. utilities make massive investments in renewable energy. Meanwhile, in Nevada, the company is fighting a plan that would encourage more residents to use green power.

CURRENT MAGAZINE ISSUE

03/01/2015
Volume 18, Issue 3
file

STAY CONNECTED

To register for our free
e-Newsletters, subscribe today:

SOCIAL ACTIVITY

Tweet the Editors! @megcichon @jennrunyon

FEATURED PARTNERS



EVENTS

Doing Business in Brazil – in partnership with GWEC, the Global Win...

Brazil is one of the most promising markets for wind energy.  Ranke...

EU PVSEC 2015 (European PV Solar Energy Conference and Exhibition)

The EU PVSEC is the largest international Conference for Photovoltaic re...

Using Grid data analytics to protect revenue, reduce network losses...

COMPANY BLOGS

EU PVSEC 2014 extends its Scope

Added focus on application and policy topicsAbstracts for conference con...

EU PVSEC 2014: Call for Papers Receives Great Response

More than 1,500 contributions apply for presentation in AmsterdamScienti...

Hawaii Solar Industry Enters Uncharted Territory

Post originally appeared on the GreenLancer Blog by Ardelia Lee In...

NEWSLETTERS

Renewable Energy: Subscribe Now

Solar Energy: Subscribe Now

Wind Energy: Subscribe Now

Geothermal Energy: Subscribe Now

Bioenergy: Subscribe Now  

 

FEATURED PARTNERS