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Renewable Energy PTC and 1603 Extensions Tacked Onto Senate Bill

Steve Leone, Associate Editor, RenewableEnergyWorld.com
March 08, 2012  |  9 Comments

Renewable energy policy has seemingly been on the hot seat since late summer. As early as today, it will finally find out how much political backing it has with a series of votes on Capitol Hill.

The wind and solar industries have been pushing strongly to get extensions of popular federal programs onto existing legislation, and they will now be included in a massive highway spending bill.

Sen. Debbie Stabenow, D-Mich., has introduced an amendment that would grant a one-year extension of the Production Tax Credit aimed mainly at the wind industry and would for one year revive the recently expired Section 1603 Treasury Grant that had been a boon for the solar industry. It also includes incentives for cellulosic biofuel, biodiesel and renewable diesel.

The Senate bill would need 60 votes for approval, meaning it would require a significant number of Republicans to cross the aisle. Chuck Grassley, a well respected Republican senator from Iowa has been a leading proponent of the state’s wind industry, and other states with a strong and growing renewables presence, like Arizona and Texas, have Republican senators that could look favorably on this bill.

But getting to 60 votes would be a monumental challenge, especially as the renewables industry as a whole continues to face skepticism from key members of the Republican party. Currently, there are 51 Democrats, 47 Republicans and two Independents in the Senate. Timothy Arcuri, a research analyst with CitiGroup, wrote late Wednesday that his Capitol Hill sources say it is unlikely enough Republicans would sign onto the legislation as it stands.

The amendment is one of 30 that were tacked on in a late-breaking deal. Elements of the Keystone XL Pipeline debate are included among the amendments, as is an amendment by Sen. Jim DeMint, R-S.C., to eliminate all energy tax incentives.

There’s plenty happening outside the Senate chamber as well. This week, Sen. Lamar Alexander, a longtime Republican figure from Tennessee, called on Congress to eliminate its subsidies aimed at the wind industry. Alexander resurrected his critique of “Big Wind,” and the backing it receives from the federal government in a speech to the conservative Heritage Foundation. Alexander said Wednesday that he will introduce a bill to end the Production Tax Credit before it expires.

In the House, Rep. Mike Pompeo, R-Kan., has introduced a bill that would repeal all energy tax credits. Such a bill would affect renewable energy industries far more than fossil fuels. It’s the second time he’s proposed this legislation, the first coming in May when energy policy was not the issue it is today.

Acuri also wrote that several states are considering their renewable portfolio standards (RPS), and that bills to fully repeal the targets have been introduced in North Carolina and Ohio, while others that would scale back standards have been proposed in Colorado, Maine, New Mexico and Washington. According Acuri, these bills are unlikely to pass, and the nation’s main RPS driver — California's 33 percent standard — maintains wide support.

At the federal level, the industry is still working to assess the prospects of the Clean Energy Standard that was recently introduced by Sen. Jeff Bingaman's, D-N.M. The standard would include renewables like solar, wind, geothermal, biomass and hydro, as well as sources such as natural gas and potentially clean coal.

“We've already seen what well-structured clean energy standards have meant in states,” said Rhone Resch, president and CEO of the Solar Energy Industries Association. “They've opened electricity markets to allow for more competition from renewable sources of energy and ultimately drive down the cost of electricity for consumers. This success can be replicated at the national level.”

9 Comments

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Joe Morinville
Joe Morinville
March 14, 2012
@peterlynch Good points. no one looks at the total cost of fossil fuel, only the user price.

How about adding all the cleanup costs for the environmental impact of the coal. Here in Western PA every stream is unsafe due to runoff. The DEP spends millions cleaning them up at a cost to taxpayers. This doesn't factor into coal costs when politicians speak.

When factoring the the cost of solar you don't hear about the real benefit to the utilities by not needing to build new power plants. Solar produces its peak in parallel with the highest grid demands. Building more solar keeps the existing grid operating in the low end of capacity thus allowing utilities NOT to have to build more production capacity. A recent utility study valued net metered solar energy at $.13-.17 /kWh in savings to the utility for this reason.

Wind on the other hand produces when the grid does not need the power. During the night and winter. This creates havoc with the grid in some areas. See what happened in the Northwest this spring thaw when they shut down all wind.

The ITC needs to be extended for distributed generation net metered projects that use only US mfg goods. It has a great benefit to solar leasing programs and should be tailored for that purpose.

All US subsidies should REQUIRE 100% American Made. This would force foreign mfg to build and grow in the US so US taxpayers get a benefit from US tax redistribution for alternative energy.

If we are going to eliminate subsidy then eliminate the all. Pull Gas/Oil/Coal etc. Truly level the playing field.
Tim Dolan
Tim Dolan
March 13, 2012
Regarding Anonymous' God comment, I had the same thought about a week ago. Given the Drill baby Drill folks are all into the God gave us Dominion over everything bullshit. My thoughts had been well turn it back on them.
The first words out of God's mouth according to the myth were "let there be light" and then God said it was good. So that means God thinks light is good, so thus Solar power is good, because it uses the first thing God produced. He meant for us to use it.

If there is any chance to convert the drill baby drill heathens to solar power it is using the bible. Or that was my thought anyway.


In the meantime, I would like to see subsidizes for solar continue for at least 5-10 more years and eliminate the specific fossil fuel subsidizes, grants, tax credits and the like immediately. After the 5-10 years, everyone on their own.

As I keep saying solar and wind may not eliminate fossil fuels, but they sure can cut down on their use so what we have lasts longer.
Peter Lynch
Peter Lynch
March 10, 2012
anonymous - we should get rid of all subsidies. But the problem is that fossil fuel subsidies have been around for 50+ years and are part of the tax code (read that as certain) renewables for a very brief period and they are year to year (uncertain). Uncertainty is the best way to get investors to keep away....and it has worked great for fossil fuels.

Plus you have to count all the non-counted subsidies - ie military presence in oil countries and the huge Navy expense to guard the sea lanes....these numbers more than double or triple the real cost of oil, for example. If you took ALL the variables and costs into account gas would be OVER $13.00 per gallon and that would end the age of fossil fuels

Once a gain it is looking at it in the short term or in the long term and if we look at it in the short term when we get to the long term it will be too late.

We need an energy plan for the nation and we have none...and that is, by any rational measure, a very foolish and very dangerous approach to our future.
ANONYMOUS
March 10, 2012
I would agree with DeMint's proposal to eliminate all energy subsidies at the federal level. This position would conform to the US Constitution. Federal energy subsidy payments are basically just a transfer of money from one state to another. If energy subsidies are warranted, they should properly be done at the state level.

As for comparisons between the current federal tax credit/subsidy situation of wind/solar and oil/gas, we need to be honest about it. Wind and solar currently make no net contribution to federal revenues. Their subsidy payments and credits exceed taxes paid. The oil/gas industry, on the other hand, has a net contribution of tens of $billions each year to federal revenues, from lease payments, excise taxes, income taxes, etc.

Lastly, with regards to renewable energy LCOE, on-shore wind is currently the best overall, hands down. PV solar or solar thermal can't compete.
Paul Felix Schott
Paul Felix Schott
March 9, 2012
Now except for a few smart ones that had a backup generator till there fuel ran out. Most of them only think the power would be out for a day or two 24 to 48 hours. A few had enough fuel for longer put not many. Hospitals and Shelters were the only lights on in all the cities up and down the east coast at night. They had Natural Gas Generators or Diesel with large storage tanks.
Perhaps the only ones you can call really smart were the ones with a Solar Energy System their lights were a Lighthouse Beacon to all around. Their lights were on every night and the gate and garage door remotes still worked.
Now being the director for safety many times in my life i would say the owners of the ones that had a Solar Energy System really did care for their family.

There will be many more times the Power Grid will go down be safe not sorry.

Renewable Energy is the way to go Wind, Hydro, Geothermal and others. Solar is clearly leading to way worldwide.

GOD Bless
The Lord's Little Helper
Paul Felix Schott
Paul Felix Schott
Paul Felix Schott
March 9, 2012
INSTALL A SOLAR ENERGY SYSTEM YOU MIGHT BE THE ONLY ONE WITH LIGHTS ON.

This nation's electric power grid is something most all of us think will never fail. Larger storms are putting more people without power in the dark every year worldwide.
One event not from a storm like the 2003 blackout on the northeast coast of the United States that took place. That event left over 50 million people in the United States and Canada and many from all other nations that were visitors to America in the dark for days. No TV or Radio for many. Many went without water to their second floor or beyond. Many had no running water at all. For the first time electronic banking stopped on the east coast of America. Many will never forget the telephones did not work. Most all transportation came to a halt no traffic lights, and gas stations no electric power to pump the gas
pumps. The smell of sewage was everywhere in the inner cities. For the first time millions of Internet Users vanished off the internet till in January of 2011 in Egypt Government Censorship.
Douglas Prince
Douglas Prince
March 9, 2012
The holy-roller Anonymous that posted above has been showing up on these boards recently. Not sure if he/she is trying to dove-tail the RE movement with some sort of religious revivalism, or is just another out-and-out batshit crazy whack job.

But his/her ramblings tend to turn into the kind of horse shit you see in that last paragraph.

Hey, Anonymous Jesus! Either ease up on the meds or drop them, but either way, keep your bullshit nonsense to yourself!
Peter Lynch
Peter Lynch
March 9, 2012
Who are the non-God energy experts and what does the last paragraph mean ??
ANONYMOUS
March 9, 2012
Finally it adds cellulosic biofuel (not ethanol), biodiesel and renewable diesel on the commercial side.

Shell and Valero are strong on the biofuel refinery side

Hydo has its own program

Like it or not wind and solar by God's design(thermal dyanamics and avoids the so callednon God energy experts) are played out on the commercial side although the are piggy back applaication fir cellulosic biofuel, biodiesel and renewable diesel.

I am glad the article mentioned Texas and wind being aneighbring sate with no wind and lttle on teh commercial side
Texas has more wind turbine farms and during their recent heat wave summer wind accounted for only 10% of teh power need during peak times.


Remember PTC means states and local governments can not collect taxes on power production from some alternaitive sources energy like they do with with fossil fuel energy production.

Power for the sun and wind have been around since God created both beginning and exist some where on earth in one of the 24 time zones created by God called earth's rotation

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Steve Leone

Steve Leone

Steve Leone has been a journalist for more than 15 years and has worked for news organizations in Rhode Island, Maine, New Hampshire, Virginia and California.
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