U.S. President Releases Details of Energy Strategy

A tax credit of 15 percent for the purchase of residential solar electric and solar thermal equipment is one of the measures contained in the strategic energy plan of President George Bush.

WASHINGTON, DC, US, 2001-07-06 [SolarAccess.com] “While solar energy technologies have undergone technological and cost improvements, and are well established in high-value markets like remote power, satellites, communications and navigational aides, continued research is needed to reduce costs, make the products more user-friendly and improve performance,” says a background document released by the White House. “Solar energy accounts for 1 percent of renewable electricity generation and 0.2 percent of total U.S. electricity supply.” The proposed tax credit would go to individuals who purchase photovoltaic equipment or solar water heating equipment for use in their residence, to a maximum credit of $2,000 for each type of equipment. The credit would be available for five years (2002 to 2007) for PV equipment and three years (2002 to 2005) for solar water heating equipment. “President Bush believes that a sound national energy policy should encourage a clean and diverse portfolio of domestic energy supplies, ensuring that future generations of Americans will have access to the energy they need,” says the document. “Renewable and alternative energy supplies not only help diversify our energy portfolio; they do so with few adverse environmental impacts.” “While the current contribution of renewable and alternative energy resources to America’s total electricity supply is relatively small, the renewable and alternative energy sectors are among the fastest growing in the United States,” it continues. “President Bush believes that continued growth of renewable and alternative energy is vital to delivering clean energy to fuel our future economic growth.” Wind generates 6 percent of electricity from renewables and 0.1 percent of the total supply in the U.S. Advances by research labs, universities, utilities and wind energy developers have reduced the cost for wind energy by 80 percent during the last 20 years, and the industry is poised for growth as a result of the numerous areas of the country with abundant wind energy potential, concedes the document. The proposal will expand the current 1.7¢/kWh tax credit for production from wind and biomass. The budget request expands eligible biomass sources to include forest-related and agricultural sources, and will expand the credit to coal plants that generate electricity from co-firing with biomass. The United States “must have a strategy, a broad, comprehensive energy strategy, that calls upon the best of the nation’s entrepreneurs to help us develop the technologies necessary to make wise choices in the marketplace, as well as calls upon our nation’s innovative technologies to help us find new sources of energy,” Bush explained. The National Energy Policy developed by vice president Dick Cheney released more than 100 recommendations last month, many of which require action by Congress. “Recent House action on both the Energy/Water and Interior appropriations bills is consistent with and largely supportive of the President’s National Energy Policy,” says the document. “Based on the Secretary of Energy’s preliminary review, the Committee’s actions in both bills to include $285 million for energy efficiency and renewable energy research and development may be supportive of the President’s objectives.” The measures announced yesterday would change the tax system to encourage use of combined heat and power, including a new tax credit for investments in cogeneration systems or a shorter depreciation life for CHP projects. It would extend the excise tax exemption for gasohol and the income tax credit for ethanol used as fuel beyond 2007 when they are scheduled to expire. It would also provide tax credits for energy from landfill gas and would support reform of the hydropower licensing process to make the process more efficient. On nuclear energy, Bush will urge Congress to allow taxpayers to make deductible contributions to a nuclear decommissioning fund and permit nuclear decommissioning funds to accumulate the full amount needed.
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