Senate Attaches Beneficial RE Legislation

On Monday, the Senate added solar and other energy tax incentives to Senate Bill 1637 that many consider must-pass legislation, according to the Solar Energy Industries Association (SEIA). The proposed bill is designed to help the US avoid billions in tariffs over a dispute with the EU on Foreign Sales Corporations.

Washington, D.C. – April 6, 2004 [] The amendment increases the odds that the industry will see its first Federal residential solar tax credit in a generation as well as a production tax credit that could be usable for solar. “Today, we are implementing a new strategy for getting the energy bill through the Senate,” said Chair of the Energy Committee, Pete Domenici. “First, I am going to get the tax provisions passed by attaching the tax package to a revised FSC/ETI. These provisions are necessary to spur new investment in transmission lines, build the Alaska Natural Gas Pipeline, expand tenfold our production of wind energy and an array of other steps critical to diversifying our energy supply.” Highlights for solar: – Residential solar tax credit at 15 percent for PV and solar water heating – Expansion of the wind production tax credit to solar beginning Oct. 1, 2004 in a manner that appears usable for concentrating solar power or other large-scale solar deployments. After the Senate passes the FSC Bill (presumably with the energy tax package) it will need to be reconciled with the House version, which does not at this time have a broad package of energy incentives. A final bill is still weeks if not months from completion and there could be issues (as always) unresolved to the solar tax credit that could stall this effort. But SEIA said they believe this improves the odds of new Federal solar tax credits taking effect in 2004. A SUMMARY OF TAX PROVISIONS IN THE REVISED BILL: (Note: The effective dates are, generally, until January 1, 2005.) Subtitle A: Renewable Energy – Extends placed-in-service date for wind, closed-loop biomass, and poultry waste facilities and adds open-loop biomass, geothermal energy, solar energy, small irrigation power, municipal bio-solids, and recycled sludge as qualifying energy resources. The credit is 1.8 cents per kWh with no inflation adjustment for facilities placed in service after the date of enactment. The title also will allow for tradable tax credits for tax-exempt entities. Subtitle B: – Alternative Vehicles and Fuel Incentives Provides a credit for the purchase of new qualified fuel cell, hybrid, or other alternative fuel motor vehicle. The buyer claims the credit, except in the case of a tax-exempt entity, in which case the seller may claim the credit. – Makes several modifications to the rules regarding the small producer ethanol credit and provides a new credit for qualified biodiesel fuel mixtures. Subtitle C: – Conservation and Energy Efficiency Provisions Provides a new credit to an eligible contractor for energy-efficient property installed in a qualified new energy-efficient home during construction, and a new credit for the purchase of qualified energy efficiency improvements for existing homes. – Provides new deduction for energy-efficient commercial building property expenditures. – Provides a new credit for the production of energy-efficient clothes washers and refrigerators. – Provides a new personal tax credit for the purchase of qualified wind energy, photovoltaic, and solar water heating property that is used exclusively for purposes other than heating swimming pools and hot tubs. – Provides a credit for certain high efficiency electric heat pump hot water heaters, electric heat pumps, natural gas furnaces, central air conditioners, natural gas water heaters, and geothermal heat pumps. – Provides a new 30 percent business energy credit for purchase of qualified fuel cell power plants for businesses. – Provides accelerated depreciation for qualified energy management devices and water submetering devices. – Provides new credit for the purchase of combined heat and power projects. Subtitle D offered a variety of Clean Coal Incentives, Subtitle E: Oil and Gas Provisions, Subtitle F: Provisions Relating to Electric Industry Restructuring, Subtitle G: Additional Provisions (see the following link)
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