Geothermal, Small Wind Among Technologies to Benefit Under New Tax Credit Legislation

Reps. Tom Reed (R-N.Y.) and Mike Thompson (D-Calif.) this week reintroduced legislation that would extend through 2021 commercial and residential installation tax credits for geothermal heat pumps, fuel cells, microturbines, small wind and combined heat and power, according to the Geothermal Exchange Organization (GEO).

HR 1090 includes a 10 percent commercial investment tax credit and a 30 percent residential income tax credit.

These technologies were left out of the tax credit extensions granted in December 2015. Tax credits for these technologies ended on Dec. 31, 2016.

“We care about ensuring that we can produce reliable, clean and affordable energy that our nation needs right here at home. By implementing common sense policies like this one, we can ensure that this can be accomplished,” Reed said in a statement. “As we move forward with tax reform, having a structure that encourages this kind of development creates the quality, family-sustaining jobs that people throughout our country deserve, all while helping meet the energy demands of today and tomorrow. It’s a win-win.”

According to GEO, residential applications would receive a retroactive tax credit of 30 percent that phases out in steps before ending on Dec. 31, 2021. The commercial tax credit will remain at 10 percent through 2021. The bill also changes “placed in service” language in the tax code to “construction of which begins before Jan. 1, 2022” for commercial projects.

“Geothermal heat pumps are 100 percent ‘Made in the USA’ with American-made components manufactured and installed by American workers,” GEO President Doug Dougherty said. “Without reinstatement and extension of federal tax credits, the entire geothermal supply chain, including manufacturers, distributors, dealers, contractors, installers, drillers — plus all the families and small businesses that they support — will all see loss of investment and jobs.”

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Jennifer Runyon has been studying and reporting about the world's transition to clean energy since 2007. As editor of the world's largest renewable energy publication, Renewable Energy World, she observed, interviewed experts about, and reported on major clean energy milestones including Germany's explosive growth of solar PV, the formation and development of the U.S. onshore wind industry, the U.K. offshore wind boom, China's solar manufacturing dominance, the rise of energy storage, the changing landscape for utilities and grid operators and much, much, more. Today, in addition to managing content on POWERGRID International, she also serves as the conference advisory committee chair for DISTRIBUTECH, a globally recognized conference for the transmission and distribution industry. You can reach her at Jennifer.Runyon@ClarionEvents.com

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