Washington, DC [RenewableEnergyAccess.com] By a vote of 15-5, the U.S. Senate Finance Committee approved an updated package of energy tax incentives yesterday, which contains a five- year extension of the tax credit for the production of electricity from wind, geothermal, biomass and other renewable energy resources.
It also extends the investment tax credit for business investments in solar, fuel cells and microturbine technology for an additional eight years. For homeowners, it extends tax credits for six years, through 2014, that help defray the cost of shifting to solar electric, solar water heating and fuel cell technologies. And it creates a new tax credit for residents using wind technology.
Finance Committee Chairman Max Baucus (D-Mont.) is expected to offer the tax package this week as an amendment to the energy bill currently on the Senate floor. Its $32.1 billion cost is fully offset, in part by changes to tax laws concerning major oil and gas companies.
“These tax incentives blaze a trail toward new energy solutions for tomorrow, and require more responsible use of the energy resources we rely on today,” said Baucus. “The Finance Committee is sending a forward-focused, fiscally responsible tax package to the full Senate. This combination of incentives and offsets provide a new and proper balance to our tax code’s treatment of energy issues. With the right emphasis on renewable fuels and alternative energy, we can turn the corner toward energy independence for our country.”
Baucus developed the final package in close consultation with Finance Ranking Republican Member Chuck Grassley (R-Iowa) and Energy Subcommittee Chairman Jeff Bingaman, who also leads the Senate Energy Committee. According to Bingaman, if adopted, the tax incentives package will have an enormous impact on the use of renewables, such as wind, biomass and solar in the U.S.
“This bill contains billions of dollars in tax incentives for renewable energy, which will help diversify our sources of domestic electricity generation and reduce our greenhouse gas emissions at the same time,” Bingaman said.
The potential amendment also modifies the list of fuels eligible for a tax credit to include fuels made from animal waste, such as bio-based compressed natural gas. It also provides a new tax credit for the production of advanced biofuels using switchgrass and sorghum.