April 18, 2008
U.S.

Senate bill would extend energy tax credits

The Senate Finance Committee unveiled on Thursday legislation to extend through 2009 tax credits for producing electricity from wind and other renewable energy sources and also for buying solar energy equipment.

Extending the tax credits, which were scheduled to expire at the end of this year, would help ensure that some $20 billion in energy projects and investments go forward.

The energy tax credits were included in a much broader bill to protect millions of Americans from paying the alternative minimum tax.

The measure is being sponsored by the Democratic chairman of the finance committee, Max Baucus of Montana, and the top Republican on the panel, Charles Grassley of Iowa.

Under the bill, companies would continue to receive a tax credit for generating electricity from wind, biomass, hydropower and geothermal facilities.

Businesses and homeowners would also be able to offset 30 percent of the cost of installing solar or fuel cell equipment with a one-time tax credit.

Tax credits would also be extended for one year for homeowners who install energy-efficient furnaces, windows and insulation.

Builders would get a tax deduction for constructing energy-efficient homes, as would businesses for making energy-efficient improvements to commercial buildings.

Manufacturers would also get tax credits to help lower their production costs for making appliances that use less energy.

The Senate this month approved a similar extension of the energy tax credits as part of a housing rescue bill.

Legislation to extend the renewable energy and investment tax credits for a longer period was approved by the House of Representatives in a separate bill in February.

But, unlike the Senate, the House wants to pay for those extensions by taking away billions of dollars in tax credits from big oil companies.

By Tom Doggett